THE COMMISSIONER OF INCOME T vs. M/S.BAY CONTAINER TERMINAL P

TCA.Nos.225 & 226/2020 In the High Court of Judicature at Madras Dated : 25.8.2020 Coram : The Honourable Mr.Justice T.S.SIVAGNANAM and The Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal Nos.225 & 226 of 2020 & CMP.No.8784 of 2020 The Commissioner of Income Tax, Chennai ...Appellant Vs M/s.Bay Container Terminal Pvt. Ltd., Chennai-5. ...Respondent APPEALS under Section 260A of the Income Tax Act, 1961 against the common order dated 04.3.2019 made respectively in ITA.Nos. 2614/Mds/2017 and 642/Mds/2016 on the file of the Income Tax Appellate Tribunal, Chennai 'A' Bench respectively for the assessment years 2012-13 and 2011-12. For Appellant: Mrs.R.Hemalatha, SSC For Respondent: Mr.A.S.Sriraman COMMON JUDGMENT (Judgment was delivered by

T.S.Sivagnanam,J)

1/4 http://www.judis.nic.in TCA.Nos.225 & 226/2020 We have heard Mrs.R.Hemalatha, learned Senior Standing Counsel appearing for the appellant – Revenue and Mr.A.S.Sriraman, learned counsel accepting notice for the respondent – assessee. 2. These appeals, filed by the Revenue under Section 260A of the Income Tax Act, 1961 (for brevity, the Act), are directed against the common order dated 04.3.2019 made respectively in ITA.Nos.2614/ Mds/2017 and 642/Mds/2016 on the file of the Income Tax Appellate Tribunal, Chennai 'A' Bench (for short, the Tribunal) respectively for the assessment years 2012-13 and 2011-12. 3. The Revenue has filed these appeals by raising the following substantial questions of law : “1. Whether, on the facts and in the circumstances of the case, the Tribunal was right in allowing plot maintenance and development expenses as a revenue expenditure especially when the said expenses were incurred periodically which gives an enduring benefit to the assessee and therefore, the same is to be treated as a capital expenditure ? 2. Whether, on the facts and in the circumstances of the case, the Tribunal was right in allowing plot maintenance and development expenses as a revenue 2/4 http://www.judis.nic.in TCA.Nos.225 & 226/2020 expenditure without appreciating the fact that the leased plot was not in the nature of stock in trade ? 3. Whether, on the facts and in the circumstances of the case, the Tribunal was right in allowing plot maintenance and development expenses as a revenue expenditure especially in the development charges paid in addition to the lease amount to the landlord which would have otherwise been incurred by the assessee for the development of the land and therefore would be capital expenditure only ? And 4. Is not the finding of the Tribunal bad especially when the plot maintenance and development expenses are to be treated as capital expenditure and only depreciation on the same is to be granted ?” 4. The learned Senior Standing Counsel for the appellant submits that the above appeals are not pursued by the Revenue on account of the low tax effect in terms of Circular No.17/2019 dated 08.8.2019 issued by the Central Board of Direct Taxes. By the said Circular, the monetary limit for filing or pursuing an appeal before the High Court has been increased to Rs.1 Crore. It is further submitted that the tax effect in the respective cases is less than the threshold limit. 3/4 http://www.judis.nic.in TCA.Nos.225 & 226/2020 T.S.SIVAGNANAM,J AND V.BHAVANI SUBBAROYAN,J RS 5. In the light of the said submissions, the above tax case appeals are dismissed on account of the low tax effect. The substantial questions of law raised are left open. In the event the tax effect in the respective cases is above the threshold limit fixed in the said circular, liberty is granted to the Revenue to make a mention to this Court to restore the appeals to be heard and decided on merits. No costs. Consequently, the connected CMP is also dismissed. 25.8.2020 To The Income Tax Appellate Tribunal, Chennai 'A' Bench. TCA.Nos.225 & 226 of 2020 and CMP.No.8784 of 2020 4/4 http://www.judis.nic.in