COMMISSIONER OF INCOME TAX vs. SHRIRAM CITY UNION FINANCE L

TCA/291/2022HC Madras2022/MHC/1043329 November 2022Bench: Hon`ble Mr Justice S. VAIDYANATHAN4 pages

AI SummaryDismissed

What did the High Court hold?

The High Court noted the submission by the Revenue's counsel that appeals against the ITAT's order in similar matters were decided on 30.06.2022. In view of this submission, the High Court stated that the present Tax Case Appeal stands closed. The judgment does not provide an independent finding on the merits of the issue regarding the deductibility of logo usage payments. The closure of the appeal is based on the concession made by the Revenue's counsel, implying that the Revenue did not wish to press the appeal further in light of recent judicial pronouncements. Therefore, the operative direction is to close the appeal, with no costs.

What were the facts?

The Revenue, Commissioner of Income Tax, Chennai, filed a Tax Case Appeal before the High Court of Judicature at Madras, challenging an order dated 08.09.2021 passed by the Income Tax Appellate Tribunal (ITAT), Madras 'B' Bench. The appeal pertained to assessment year 2014-15 and concerned the assessee, Shriram City Union Finance Ltd. The ITAT had decided an issue against the Revenue, relying on its own previous decisions in the cases of M/s. Shriram Transport Finance Company Ltd. and the assessee's own case for assessment year 2006-07. The Revenue's counsel submitted that appeals against similar ITAT orders were recently decided on 30.06.2022, and therefore, the present appeal could be closed.

What were the issues?

1. Whether the payment made by the assessee for the right to use a logo is revenue in nature and deductible while computing income from business or profession, as held by the ITAT. Assessee's Contention: The assessee contended that the payment for the right to use a logo is revenue in nature and deductible. The ITAT, in its impugned order, upheld the deletion of additions made by the Assessing Officer towards royalty, consistent with its previous decisions. Revenue's Contention: The Revenue's appeal was based on challenging the ITAT's order. However, the Revenue's counsel later submitted that similar appeals were recently decided, and in view of those decisions, the present appeal could be closed. The specific arguments made by the Revenue before the ITAT are not detailed in this High Court judgment, other than the fact that the ITAT answered the issue against the Revenue.

Which sections of the Income-tax Act were involved?

Section 260A

AI-generated summary — verify with the full judgment below

Tax Case Appeal No.291 of 2022 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED :29.11.2022 CORAM : THE HONOURABLE MR. JUSTICE S.VAIDYANATHAN AND THE HONOURABLE MR. JUSTICE C.SARAVANAN Tax Case Appeal No.291 of 2022 Commissioner of Income Tax Chennai. . .. Appellant Versus Shriram City Union Finance Ltd. Mookambika Complex, No.4, Lady Desika Road, Mylapore, Chennai-600004. PAN:AAACS 7703H

.. Respondent Tax Case Appeal filed under Section 260A of the Income Tax Act, 1961 against the order dated 08.09.2021 passed by the Income Tax Appellate Tribunal, Madras “B” Bench, in I.T.A.No.1298/Chny/2019.

For Appellant : Mr.J.Narayanaswamy *** J U D G M E N T This Tax Case Appeal has been filed by the Appellant / Revenue, calling 1/4 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.291 of 2022 in question the correctness of the order dated 08.09.2021 passed by the Income Tax Appellate Tribunal, 'B' Bench, Chennai, in I.T.A.No.738/Mds/03, relating to the assessment year 2014-15. 2.By the impugned order, the Tribunal answered the issue against the Revenue, placing reliance on the decision of the Tribunal in M/s.Shriram Transport Finance Company Ltd. in ITA No.2572 & 2636/Chny/2017 dated 24.05.2018 and Assessee's own case for assessment year 2006-07 in ITA.No.726/Mad/2010. The relevant portion of the order reads as under: "13. We have heard both the parties, perused material available on record and gone through orders of the authorities below. We find that the Tribunal has considered an identical issue in the case of M/s.Shriram Transport Finance Company Ltd. in ITA.No.2572 & 2636/Chny/2017 dated 24.05.2018 for assessment year 2014-15, where it was held that payment made by the assessee for right to use logo is revenue in nature, which is deductible while computing income from business or profession. Further, similar issue has been considered in assessee's own case for assessment year 2006-07 in ITA.No.726/Mad/2010. Therefore, consistent with the view taken by co-ordinate Bench, we are of the considered view that there is no error in the reasoning given by the learned CIT (A) to delete additions made towards royalty and hence, we are inclined to uphold findings of the learned CIT (A) and reject ground taken by the revenue." 2/4 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.291 of 2022 3. The learned counsel appearing for the Appellant fairly submitted that the Appeals against the order of the Income Tax Appellate Tribunal, were recently decided on 30.06.2022 in T.C.A.Nos.755 of 2009 etc. batch and hence in view of the same, the present Appeal may be closed. 4. Recording the submission of the learned counsel for the Appellant, this Tax Case Appeal stands closed. No costs. [S.V.N, J.] [C.S.N, J.] 29.11.2022

Internet : Yes

Index : Yes / No arr 3/4 https://www.mhc.tn.gov.in/judis Tax Case Appeal No.291 of 2022 S. VAIDYANATHAN, J. AND C.SARAVANAN, J. arr To 1. The Income Tax Appellate Tribunal, Chennai “B” Bench. 2. Commissioner of Income Tax Chennai. TCA No. 291 of 2022 29.11.2022 4/4 https://www.mhc.tn.gov.in/judis

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