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2019 (2) TMI 172 - HC - Income TaxWaiver of interest for non payment of advance tax - refund of interest already pad - dispute regarding Nature of expenses - modernization and replacement expenses - revenue or capital expenditure - petitioner wanted to modernise their mill by removing old, worn out machinery and replacing the same by new machinery - Held that:- The common thread running through all the decisions refereed is that any expenditure incurred on account of modernisation and replacements of machinery of the textile mills will have to be considered only as revenue expenditure. As late this was the position that prevailed. The learned counsel for the petitioner has enclosed an order rendered THE COMMISSIONER OF INCOME TAX MADURAI VERSUS M/S. SRI MANGAYARKARASI MILLS (P) LTD MADURAI [2006 (12) TMI 562 - MADRAS HIGH COURT] in this case. The respondent is not in a position to show any contra decision. Therefore, the assessee cannot be blamed for short payment of advance tax by taking into account the expenditure incurred on this score. The case on hand squarely falls within Para 2(c) of the Notification dated 26.06.2006 issued by the Central Board of Direct Taxes. Even though these aspects have been pointedly raised by the assessee, the impugned order does not deal with the same at all. In this view of the matter, the order impugned in this writ petition is quashed. Since as already held that the petitioner's case falls under Para 2(c) of the Notification dated 26.06.2006, the respondent is directed to waive the entire interest levied under Section 234B. The petitioner had already paid the interest in terms of Section 234 B of the Income Tax Act. Since held that the said interest will have to be waived, the petitioner is not only entitled to refund of the amount paid but also is entitled to interest thereon. The issue is covered by the decision of the Hon'ble Supreme Court reported in K.Lakshmansa and Co v. Commissioner of Income Tax and Another [2017 (11) TMI 589 - SUPREME COURT]. The respondent shall refund the amount in question with interest within a period of three months from the date of receipt of a copy of this order.
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