Departmental appeal against ITAT order for AY 2006-07 concerning six disallowance/deduction issues in favour of TVS Motor Company. All issues were covered by earlier decisions including the assessee's own case in 364 ITR 1 and Supreme Court ruling in Taparia Tools; substantial questions answered against Revenue.
This page shows the compact analysis of this judgement. The full analysis — procedural history, issue-by-issue holdings with ratio and obiter, advocates, and paragraph-level evidence for every claim — is being added to the record in batches and will appear here when this judgement has been through it.
T.C.A.No.350 of 2015
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 09.09.2024
CORAM :
THE HONOURABLE MR.JUSTICE R. SURESH KUMAR AND
THE HONOURABLE MR.JUSTICE C. SARAVANAN
T.C.A.No.350 of 2015
The Commissioner of Income Tax Chennai.
.. Appellant
Vs.
M/s. TVS Motor Company Limited Jayalakshmi Estates, 29 (Old No.8) Haddows Road, Chennai – 600 006.
.. Respondent
Prayer: Appeal filed under Section 260A of the Income Tax Act, 1961, against the order of the Income Tax Appellate Tribunal, Madras “A” Bench, Chennai dated 04.10.2012 passed in I.T.A.No.943/Mds/2011.
For the Appellant : Mr.J.Narayanaswamy Senior Standing Counsel
For the Respondent : Mr.R.Vijayaraghavan
for M/s.Subbaraya Aiyar Padmanabhan
JUDGMENT
This tax case appeal is directed against the common final
order dated 04.10.2012 passed by the Income Tax Appellate Tribunal in I.T.A.No.943/Mds/2011 for the Assessment Year 2006-07.
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T.C.A.No.350 of 2015
Income Tax Appeal in I.T.A.No.944/Mds/2011 for the Assessment Year 2007-08. Aggrieved over the same, the Income Tax Department had also filed T.C.A.No.351 of 2015 against the order made in I.T.A.No.944/Mds/2011 for the Assessment Year 2007-08. The said appeal has been kept pending to await for this order.
“i) Whether on the facts and in the circumstances of the case, the Appellate Tribunal was right in holding that disallowance of expenses on Asian Project amounting to Rs.16,14,13,328/- is to be allowed?
ii) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding the disallowance of expenditure on replacement of dies and moulds amounting to Rs.6,72,36,406/- is to be allowed?
iii) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding the deduction under Section 35(1)(iv) of the Income Tax Act amounting to Rs.5,81,72,790/- is to be allowed?
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T.C.A.No.350 of 2015
iv) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that deduction under Section 35(2AB) of the Income Tax Act amounting to Rs.12,58,94,838/- is to be allowed?
v) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding the deduction under Section 80IA of Rs.61 lakhs is to be allowed?
vi) Whether on the facts and in the circumstances of the case, the Tribunal was right in holding that the disallowance of Rs.8,01,793/- made on Entry tax is to be allowed? vii) Was there enough material before the Tribunal to come to such conclusion as it had arrived at and the reasoning of the Tribunal is bad?"
v. Deduction under Section 80IA
vi. Entry Tax
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T.C.A.No.350 of 2015
6.2. Issues (2) and (3) are covered in favour of the assessee
by the assessee's own case reported in 364 ITR 1 (paragraph 28 to 32).
6.3. For issue (4), the order of the Assessment Year 2005-06
has been followed.
6.4. Insofar as issues (5) and (6) are concerned, the same are
covered in favour of the assessee in the case of CIT vs. Thiagarajar
Mills2 and 364 ITR 1 (paragraphs 33 and 34) respectively.
6.5. The same can be tabulated as under:-
1 55 taxmann.com 361
2 TC(A) Nos.69 to 70 of 2010; dated: 07.06.2010.
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T.C.A.No.350 of 2015
Si.
| Si. No. |
Issues | AO | CIT(A) | ITAT | Remarks |
|---|---|---|---|---|---|
| 1. | Expenditure on ASEAN Project – Indonesia |
Page 2 Para 1 |
Page 20 Para 4 |
Page 49 Para 3 to 5 |
ITAT followed Assessment Year 2000-01. In AY 2000-01, Department has accepted the order of the Tribunal on this issue and preferred appeal only on other issues which was dismissed in TC(A) No.331 of 2011 dated 08.03.2022. In any case, ratio covered by SC decision in Taparia Tools (supra) |
| 2. | Expenditure on replacement of Dies & Moulds |
Page 3 Para 2 |
Page 27 Para 9 |
Page 53 Para 6 to 8 |
Covered in favour of assessee by assessee's own case reported in 364 ITR 1@ para 29 |
| 3. | Deduction u/s. 35(1)(iv) |
Page 5 Para 4 |
Page 23 Para6 |
Page 55 Para 9, 10 |
Covered in favour of assessee by assessee's own case reported in 364 ITR 1@ para 28 to 32 |
| 4. | Deduction u/s. 35(2AB) |
Page 5 Para 5 |
Page 24 Para 7 |
Page 57 Para 11 to 15 |
Factual. ITAT directed R&D as certified by DSIR in Form 3CL to be given. Followed AY 2005-06 order. |
| 5. | Deduction u/s.80IA |
Page 4 Para 3 |
Page 24 Para10 |
Page 61 Para21 to 24 |
Covered in favour of assessee in the case of Thiagarajar Mills (supra) |
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T.C.A.No.350 of 2015
Si.
No.
6.
| Si. No. |
Issues | AO | CIT(A) | ITAT | Remarks |
|---|---|---|---|---|---|
| 6. | Entry Tax | Page 6 Para 6 |
Page 29 Para 12 |
Page 62 Para 25 to 27 |
Covered in favour of assessee by assessee's own case reported in |
| 364 ITR 1@ para 33 & 34. |
against the Revenue and in favour of the respondent assessee. In view of the above, the present appeal filed by the Income Tax Department is liable to be dismissed. It is accordingly dismissed. There shall be no order as to costs.
(R.S.K., J.) (C.S.N, J) 09.09.2024
Neutral Citation:Yes/No
drm
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T.C.A.No.350 of 2015
To:
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T.C.A.No.350 of 2015
R. SURESH KUMAR, J. AND C. SARAVANAN, J.
(drm)
T.C.A.No.350 of 2015
09.09.2024
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3 issues framed by the court
Was the Tribunal right in allowing disallowance of ASEAN Project expenditure of Rs.16,14,13,328/-?
Were the Tribunal's allowances on dies/moulds replacement and Section 35(1)(iv) deduction sustainable?
Were deductions under Section 35(2AB), Section 80IA and Entry tax disallowance correctly allowed by the Tribunal?
Colour shows how this judgement treated each authority
Taparia Tools vs. JCITApplied
Taparia Tools vs. JCIT, 55 taxmann.com 361
364 ITR 1Applied
CIT vs. Thiagarajar MillsApplied
CIT vs. Thiagarajar Mills, TC(A) Nos.69 to 70 of 2010; dated: 07.06.2010
4 provisions across 1 enactments
The Commissioner of Income Tax Chennai
M/s. TVS Motor Company Limited
R. Suresh Kumar
C. Saravanan
As recorded by the court registry
Judgements on the same questions, provisions and authorities, from every court
