Commissioner of Income-tax, Chennai v. Shriram Chits Tamilnadu Pvt. Ltd
[Citation -2020-LL-0812-2]
| Citation | 2020-LL-0812-2 |
|---|---|
| Appellant Name | Commissioner of Income-tax, Chennai |
| Respondent Name | Shriram Chits Tamilnadu Pvt. Ltd. |
| Court | HIGH COURT OF MADRAS |
| Relevant Act | Income-tax |
| Date of Order | 12/08/2020 |
| Judgment | View Judgment |
| Keyword Tags | revenue expenditure • capital expenditure • intangible asset • monetary limit • tax effect • royalty |
| Bot Summary: | For Appellant : Mr.J.Narayanaswamy, Senior Standing Counsel For Respondent : Mr.R.Sivaraman ORDER The Court was held by Video Conference as per the Resolution of the Full Court dated 03 July 2020, by Judges at the respective residence and the counsel, staff of the Court appearing from their respective residences. This Tax Case Appeal has been filed by the Revenue, calling in question the correctness of the order passed by the Income Tax Appellate Tribunal, Madras B Bench, dated 29.07.2016 in ITA.No. 732/Mds/2016, by raising the following substantial questions of law: Whether on the facts and in the circumstances of the case the tribunal was right in holding that the royalty paid by the assessee towards the copy right for use of logo is to be treated as revenue expenditure without appreciating that as per the section 32 w.eJ 1.4.99 read with expln 3, the copyright is to be treated as intangible asset of capital nature and consequently the royalty payment is a capital expenditure and the assessee is entitled for depreciation only 3. When the matter is taken up for hearing, learned Standing Counsel brought to our notice the Circular issued by the 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 the Department before the High Court in cases where the tax effect does not exceed Rs.1,00,00,000/-. In the instant case, the tax effect is said to be less than the monetary limit imposed and therefore, the Appeal filed by the Revenue is dismissed as withdrawn, keeping open the substantial questions of law for determination in appropriate cases. |