Madras High Court
M/S.India Motor Parts Accessories Ltd vs The Asst Commissioner Of Income Tax on 28 October, 2024
Author: Anita Sumanth
Bench: Anita Sumanth
2024:MHC:3797
T.C.A.Nos.446 & 447 of 2013
IN THE HIGH COURT OF JUDICATURE AT MADRAS
Dated: 28.10.2024
CORAM
THE HONOURABLE DR. JUSTICE ANITA SUMANTH
and
THE HONOURABLE MR. JUSTICE G.ARUL MURUGAN
T.C.A.Nos.446 & 447 of 2013
M/s.India Motor Parts Accessories Ltd.,
46, Whites Road,
Royapettah,
Chennai 600 014. .... Appellant
Vs
The Asst Commissioner of Income tax,
Company Circle – 11(3)
Chennai. ... Respondent
COMMON PRAYER : APPEALS filed under Section 260 A of the Income
Tax Act, 1961 against the order of the Income Tax Appellate Tribunal, “C”
Bench, Chennai dated 22.03.2013 in I.T.A.No.2011/Mds/2008 and
I.T.A.No.2012/Mds/2008 respectively.
(In both TCAs)
For Appellant : Mr.R.Venkatanarayanan
For Respondent : Mr.T.Ravikumar
Senior Standing Counsel
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Page No.1/4
T.C.A.Nos.446 & 447 of 2013
COMMON JUDGMENT
(Judgment of the Court was delivered by Dr.ANITA SUMANTH,J.)
Heard Mr.Venkatanarayanan, learned counsel for the
assessee/appellant and Mr.T.Ravi Kumar, learned Senior Standing Counsel
for the respondent/Income Tax Department.
2.The appeals relates to AY 2001-02 and 2002-03 and the substantial
questions of law raised for decision are as follows:
'1)Whether on the facts and circumstances of the case
the Tribunal was right in law in holding that the amount
received by the assessee from Royal & Sun Assurance, U.K.,
is revenue receipt chargeable to tax.
2)Whether on the facts and in the circumstances of the
case the Tribunal was right in law in holding that the
amount received by assessee was only for exploitation of the
services and infrastructure of the assessee and not towards
restrictive covenant.'
3.In the order of Income Tax Appellate Tribunal dated 22.03.2013, the
Tribunal has relied on a decision in the case of M/s.Sundaram Finance Ltd. v.
Assistant Commissioner of Income Tax (TCA.No.1938 of 2008 dated
19.06.2019) in relation to the issue of taxability of amount received towards
restrictive covenant and whether the same is revenue or capital in nature.
4.That appeal, Tax Case Appeal No.1938 of 2008 in the case of
https://www.mhc.tn.gov.in/judis
T.C.A.Nos.446 & 447 of 2013
Sundaram Finance has been decided by a Division Bench of this Court on
19.06.2019 in favour of the assessee. The substantial questions of law raised
in that case are as follows:
'1.Whether on the facts and circumstances of the case,
the Tribunal was right in law in holding that the amount
received towards restrictive convenant is revenue receipt
chargeable to tax?
2.Whether on the facts and circumstances of the case,
the Tribunal was right in law in holding that the bad debts
recovered by the appellant, which were written off and
allowed as deduction in respect of Companies which got
amalgamated with the appellant Company, should be taxed
in the hands of the appellant?'
5.In light of the aforesaid, the substantial questions of law raised in the
present case are also liable to be answered in favour of the assessee and we
do so. Both the Tax Case Appeals are allowed. No costs.
(A.S.M.,J) (G.A.M.,J)
28.10.2024
Index:Yes/No
Speaking order
Neutral Citation: Yes
vs
https://www.mhc.tn.gov.in/judis
T.C.A.Nos.446 & 447 of 2013
DR. ANITA SUMANTH,J.
and
G.ARUL MURUGAN,J.
vs
T.C.A.Nos.446 & 447 of 2013
28.10.2024
https://www.mhc.tn.gov.in/judis
