Judgment dt. 26.09.2019 in TC(A) No.96 of 2014 CIT v. M/s.Vijayeswari Textiles Ltd. IN HIGH COURT OF JUDICATURE AT MADRAS DATED: 26.09.2019 CORAM : HON'BLE DR.VINEET KOTHARI, ACTING CHIEF JUSTICE AND HON'BLE MR.JUSTICE C.SARAVANAN Tax Case (Appeal) No.96 of 2014 Commissioner of Income Tax, Coimbatore. .. Appellant -vs- M/s.Vijayeswari Textiles Ltd., 10/400 Palghat Road, Kuniamuthur, Coimbatore-641 008. .. Respondent Tax Case Appeals filed under Section 260A of Income Tax Act, 1961, against order of Income tax Appellate Tribunal, 'B' Bench, Chennai, dated 23.08.2011 made in ITA.No.963/Mds/2011. For Appellant : Mr.T.R.Senthilkumar Sr. Standing Counsel assisted by Ms.K.G.Usharani Jr. Standing Counsel For Respondent : M/s.Meenakshi Sundaram Page 1 of 5 http://www.judis.nic.in Judgment dt. 26.09.2019 in TC(A) No.96 of 2014 CIT v. M/s.Vijayeswari Textiles Ltd. JUDGMENT (Delivered by Hon'ble Acting Chief Justice) This Tax Case Appeal has been filed by Revenue, calling in question correctness of order passed by Income Tax Appellate Tribunal, 'B' Bench, Chennai, dated 23.08.2011, for Assessment Year 2006-07, by raising following substantial questions of law: 1.Whether Tribunal was correct in holding that expenditure incurred by assessee on replacement of electronic yarn cleaner is allowable as revenue expenditure as well as current repair? 2.Whether under facts and circumstances of case Tribunal was right in holding that entire payment made for ERP software is for outright purchase of software and there is no provision for rendering any professional service and therefore 194 J and consequently 40 (a) (ia) do not apply to case of assessee? Page 2 of 5 http://www.judis.nic.in Judgment dt. 26.09.2019 in TC(A) No.96 of 2014 CIT v. M/s.Vijayeswari Textiles Ltd. 3.Whether based on material available before it Income Tax Appellate Tribunal could have come to conclusion that it is not possible to divide turnkey project into two, one towards cost of software and another towards cost of implementation of deliverables? 4.Whether under facts and in circumstances of case, Income Tax Appellate Tribunal was right in holding that amount of Rs.3,90,64,745/- written off out of receivable taken over from sister concern is allowable as business loss? 2. When matter is taken up for hearing, learned Senior Standing Counsel brought to our notice Circular instruction issued by Central Board of Direct Taxes vide Circular No.17/2019 dated 8th August 2019, wherein, it is stipulated that appeals shall not be filed/pursued by Department before High Court in cases where tax effect does not exceed Rs.1,00,00,000/- (Rupees One Crore). 3. In instant case, tax effect is said to be less than Page 3 of 5 http://www.judis.nic.in Judgment dt. 26.09.2019 in TC(A) No.96 of 2014 CIT v. M/s.Vijayeswari Textiles Ltd. monetary limit imposed and therefore, Appeal filed by Revenue is dismissed, as withdrawn, keeping open substantial questions of law for determination in appropriate cases. No costs. (V.K.,ACJ.) (C.S.N.,J.) 26.09.2019 Index : Yes/No bbr To: 1. Registrar, Income Tax Appellate Tribunal, Madras "B" Bench, Chennai. 2. Commissioner of Income Tax (Appeals)-II, Coimbatore. 3. Assistant Commissioner of Income Tax, Salary Circle I, Coimbatore. Hon'ble Acting Chief Justice and Page 4 of 5 http://www.judis.nic.in Judgment dt. 26.09.2019 in TC(A) No.96 of 2014 CIT v. M/s.Vijayeswari Textiles Ltd. C.Saravanan, J. bbr T.C.(A) No.96 of 2014 26.09.2019 Page 5 of 5 http://www.judis.nic.in Commissioner of Income-tax, Coimbatore v. Vijayeswari Textiles Ltd