COMMISSIONER OF INCOME TAX vs. M/S. TAMILNADU ROAD,

TCA/623/2017HC Madras30 August 2022Bench: Hon`ble Mr Justice R. MAHADEVAN4 pages

AI SummaryWithdrawn

What did the High Court hold?

The High Court noted the submission by the Revenue's counsel regarding CBDT Circular No. 17/2019, which mandates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs. 1,00,00,000/-. The Revenue confirmed that the tax effect in the present appeal was below this monetary limit. Consequently, the High Court dismissed the appeal as withdrawn, stating that the substantial questions of law were kept open for determination in an appropriate case. No costs were awarded. The specific findings of the ITAT on the eligibility of depreciation were not discussed or adjudicated by the High Court.

What were the facts?

The Revenue, Commissioner of Income Tax, Company Circle III, Chennai, filed an appeal under Section 260A of the Income Tax Act, 1961, against the order dated 23.12.2016 passed by the Income Tax Appellate Tribunal (ITAT), "C" Bench, Chennai. The appeal pertained to assessment year 2009-2010 and concerned the eligibility of a road, developed and maintained by the assessee, M/s. Tamilnadu Road Development Company Limited, under an agreement with the Government, for depreciation. The Revenue challenged the ITAT's decision that the road was eligible for depreciation despite the assessee not being the owner.

What were the issues?

1. Whether the Tribunal was right in holding that a road, developed and maintained by the assessee by agreement with the Government on State/National Highways, is eligible for depreciation when the assessee is not the owner of the road? (Question of law) 2. Whether the Tribunal was right in holding that a road, developed and maintained by the assessee by agreement with the Government on State/National Highways, is eligible for depreciation? (Question of law) Assessee's contentions: Not recorded in the judgment. Revenue's contentions: The Revenue argued that the road is not eligible for depreciation as the assessee is not the owner. The Revenue also brought to the court's notice CBDT Circular No. 17/2019, which stipulates that appeals shall not be filed or pursued if the tax effect does not exceed Rs. 1,00,00,000/-. The Revenue submitted that the tax effect in this appeal is less than the threshold limit.

Which sections of the Income-tax Act were involved?

Section 260A

AI-generated summary — verify with the full judgment below

T.C.A.No.623 of 2017 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 30.08.2022 CORAM : THE HONOURABLE MR. JUSTICE R. MAHADEVAN AND THE HONOURABLE MR. JUSTICE MOHAMMED SHAFFIQ T.C.A.No.623 of 2017 Commissioner of Income Tax, Company Circle III, Chennai 600 034. ... Appellant

Versus M/s. Tamilnadu Road, Development Company Limited, 171, 2nd Floor, TNMB Building, South Kesavaperumal Road, Greenways Road, R.A.Puram, Chennai 600 028. PAN : AABCT 3389 H ... Respondent Appeal preferred under Section 260A of the Income Tax Act, 1961, against the order dated 23.12.2016 passed by the Income Tax Appellate Tribunal, “C” Bench, Chennai, in I.T.A.No.2192/Mds/2014. For Appellant : Mr.M.Swaminathan, Senior Standing Counsel Mrs.V.Pushpa, Standing Counsel For Respondent : Mr.S.Sridhar

Page 1/4 https://www.mhc.tn.gov.in/judis T.C.A.No.623 of 2017 JUDGMENT (Judgment of the Court was delivered by R.MAHADEVAN, J.) This tax case appeal has been filed by the appellant / Revenue, challenging the order dated 23.12.2016 passed by the Income Tax Appellate Tribunal, “C” Bench, Chennai, in I.T.A.No.2192/Mds/2014, relating to the assessment year 2009-2010, by raising the following substantial questions of law: “(i) Whether the Tribunal was right in holding that Road, developed and maintained by the assessee by agreement with Government on State/National Highways is eligible for depreciation when the assessee is not the owner of Road? (ii) Whether the Tribunal was right in holding that Road, developed and maintained by the assessee by agreement with Government on State/National Highways is eligible for depreciation? " 2.When the matter was taken up for consideration, the learned counsel for the appellant / Revenue brought to the notice of this court the Circular No.17/2019 dated 08.08.2019 issued by the Central Board Direct Taxes, wherein, it is stipulated that appeal shall not be filed/pursued by the Department before the High Court in cases where the tax effect does not Page 2/4 https://www.mhc.tn.gov.in/judis T.C.A.No.623 of 2017 exceed Rs.1,00,00,000/- (Rupees One Crore). It is also submitted that the tax effect in this appeal is less than the threshold limit. 3.In the light of the aforesaid submissions made by the learned counsel for the appellant / Revenue, the present appeal, wherein, the tax effect is said to be less than the monetary limit imposed, is dismissed as withdrawn, keeping open the substantial questions of law for determination in an appropriate case. No costs. (R.M.D., J.) (M.S.Q., J.) 30.08.2022

Internet : Yes

Index : Yes / No msr/av To 1. The Income Tax Appellate Tribunal, “C” Bench, Chennai. 2. Commissioner of Income Tax, Company Circle III, Chennai 600 034. 3. The Assistant Commissioner of Income Tax, Company Circle - III (1), Chennai. Page 3/4 https://www.mhc.tn.gov.in/judis T.C.A.No.623 of 2017 R. MAHADEVAN, J. and MOHAMMED SHAFFIQ, J. av T.C.A.No.623 of 2017 30.08.2022 Page 4/4 https://www.mhc.tn.gov.in/judis

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