IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO.7593 OF 2009 (Arising out of S.L.P. (C) No.3854 of 2008)

Commissioner of Income Tax, Salem          ...Appellant(s)

Versus

M/s. Sugavaneeshwara Spg. Mills Ltd.      ...Respondent(s)

O  R  D  E  R

Heard learned counsel on both sides.

Delay condoned.

Leave granted.

By  consent,  the  matter  is  taken  up  for  final  

hearing.

The narrow controversy is – whether, on facts and  

circumstances  of  this  case,  the  respondent  [assessee  

herein] was not entitled to deduction in view of the law  

laid down in the judgement of the Division Bench of this  

Court in the case of  Commissioner of Income Tax vs.  Sri  

Mangayarkarasi Mills Private Limited, reported in [2009]  

315 I.T.R. 114?

According  to  the  learned  counsel  appearing  on  

behalf of the assessee, the judgement of this Court in the  

case  of  Sri Mangayarkarasi Mills Private Limited [supra]

...2/-

- 2 -  

does not lay down the law across the board and that the  

said judgement has to be seen in the facts of each case.  

We  express  no  opinion  on  the  said  submission.  

Accordingly, we remit this matter to the High Court for de  

novo consideration in the light of the judgement in the  

case of Sri Mangayarkarasi Mills Private Limited [supra],  

which has been delivered only on 21st July, 2009.  The High  

Court  would  also  consider  the  tests  laid  down  by  this  

Court  in  the  cases  of  Commissioner  of  Income  Tax vs.  

Saravana Spinning Mills Private Limited reported in [2007]  

293  I.T.R.  201,  and  Commissioner  of  Income  Tax vs.  

Ramaraju  Surgical  Cotton  Mills,  reported  in  [2007]  294  

I.T.R. 328, while disposing of this case on merits.  We  

express no opinion on merits.

Subject to what is stated herein, the appeal is  

allowed with no order as to costs.

......................J.            [S.H. KAPADIA]

......................J.            [DR. B.S. CHAUHAN]

New Delhi, November 16, 2009.