M/S RANE BRAKE LININGS LIMIT vs. THE DEPUTY COMMISSIONER OF I

Tax Case Appeal No.244 of 2019 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 20.04.2021 CORAM THE HON'BLE MR.JUSTICE M. DURAISWAMY AND THE HON'BLE MRS.JUSTICE R. HEMALATHA Tax Case Appeal No.244 of 2019 M/s.Rane Brake Linings Limited, (now known as Rane Brake Lining Limited) Plot No.30, Industrial Estate, Ambattur, Chennai – 600 058.

... Appellant Vs.

The Deputy Commissioner of Income Tax, Large Taxpayer Unit-II, Now Corporate Circle 5(1), Chennai. ... Respondent

Tax Case Appeal filed under Section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal, Madras "A" Bench, dated 15.02.2018 passed in I.T.A.No.1593/Chny/2014. For Appellant : Mr.R.Venkata Narayanan for M/s.Subbaraya Aiyar Padmanabhan For Respondent : Mrs.R.Hemalatha Standing Counsel Page 1/6 https://www.mhc.tn.gov.in/judis/ Tax Case Appeal No.244 of 2019 J U D G M E N T (Delivered by M.DURAISWAMY, J.) This appeal filed by the assessee under Section 260A of the Income Tax Act, 1961 ('the Act' for brevity), is directed against the order dated 15.02.2018 passed by the Income Tax Appellate Tribunal, Madras "A" Bench, ('the Tribunal' for brevity) in I.T.A.No.1593/Chny/2014 for the assessment year 1999-2000. The above appeal was admitted on 09.11.2020 on the following Substantial Questions of Law. “1.Whether the order of the Tribunal is perverse in holding that the assessee has invested its interest bearing funds in equity shares earning dividend income which is exempt from tax and that these investments were not made for strategy purposes or due to commercial expediency? 2.Whether the Tribunal was right in law in confirming the disallowance of proportionate interest expenditure as relating to investment of borrowed funds in group companies without appreciating that the Appellant had sufficient funds by way of retained earnings and capital for making the investment in the group companies and the assessee had not used any borrowed amount for making investment? Page 2/6 https://www.mhc.tn.gov.in/judis/ Tax Case Appeal No.244 of 2019 3.Whether the Tribunal was right in law in not appreciating the Principle that if there are funds available both interest-free and overdraft and/or loans taken, then a presumption would arise that investments would be out of the interest-free fund generated or available with the company, if the interest-free funds were sufficient to meet the investments. 4.Whether the Tribunal was right in law in confirming the order of lower authorities sitting in judgment on matters relating to earlier years in the current assessment year, where the assessments have been completed and the appellant filed details in support of its claim that it had cash from operating activities and reserves and surplus for making investments?" 2. We have heard Mr.R.Venkata Narayanan for M/s.Subbaraya Aiyar Padmanabhan, learned counsel for the appellant/assessee and Mrs.R.Hemalatha, learned Standing Counsel for the respondent/Revenue. 3. It may not be necessary for this Court to decide the Substantial Questions of Law framed for consideration on account of certain subsequent developments. The Government of India enacted the Direct Tax Vivad Se Vishwas Act, 2020 (Act 3 of 2020) to provide for Page 3/6 https://www.mhc.tn.gov.in/judis/ Tax Case Appeal No.244 of 2019 resolution of disputed tax and for matters connected therewith or incidental thereto. The Act of the Parliament received the assent of the President on 17th March 2020 and published in the Gazette of India on 17th March 2020. 4. We are informed by the learned counsel for the appellant/ assessee that the assessee had already been issued with Form-3 on 22.02.2021 and the learned counsel for the appellant seeks permission of this Court to withdraw the appeal. 5. In view of the submission made by the learned counsel for the appellant, the Tax Case Appeal stands dismissed as withdrawn. No costs. [M.D., J.] [R.H., J.] 20.04.2021 (1/2)

Index : Yes/No

Internet : Yes

mkn To Page 4/6 https://www.mhc.tn.gov.in/judis/ Tax Case Appeal No.244 of 2019 1. Income Tax Appellate Tribunal, Madras "A" Bench 2.The Deputy Commissioner of Income Tax, Large Taxpayer Unit-II, Now Corporate Circle 5(1), Chennai. M. DURAISWAMY, J. and Page 5/6 https://www.mhc.tn.gov.in/judis/ Tax Case Appeal No.244 of 2019 R. HEMALATHA, J. mkn Tax Case Appeal No.244 of 2019

20.04.2021 (1/2) Page 6/6 https://www.mhc.tn.gov.in/judis/