Cit vs Saravana Spinning Mills P. Ltd. on 18 January, 2007
8. So far as the case on merit is concerned, the ld. Counsel for the assessee
submitted that the issue in relation to replacement of machinery is squarely
covered as has been dealt with by the Hon'ble Supreme Court in various
decision and latest decision on this point comes from the decision of Hon'ble
Supreme Court by Three Judges Bench in the case of CIT v. M/s. Narasimha
Mills Ltd. in C.A. No. 4893 of 2010 dated 05.07.2010 in which the earlier
decisions in the case of CIT v. Saravana Spinning Mills (P) Ltd. [2007] 211 CTR
(SC) 281 and CIT vs. Ramaraju Surgical Cotton Mills 294 ITR 328, have been
followed, wherein direction has been given that matter should go back to the ld.
CIT(A) for considering availability of deduction under section 37(1), thus, it was
pleaded that the matter should go back to the ld. CIT(A) in case appeal of the
assessee on legal ground is not to be accepted with the direction to follow the
Hon'ble Supreme Court's decisions taken in this regard and to this move of the
ld. Counsel for the assessee, the ld. DR did not object and rather conceded that
12 ITA No.337
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the matter can go back to the file of the ld. CIT(A) for re-consideration as per the
directions of the Hon'ble Supreme Court.