IN THE COURT OF APPEAL OF THE DEMOCRATIC SOCIALIST REPUBLIC OF SRI LANKA In the matter of a Case Stated under Section 170 of the Inland Revenue Act No 10 of 2006 The Wheel Works (Pvt) Ltd, No.68, Block A, Biyagama Export Processing Zone, Biyagama. Appellant CA TAX No. 11/2013 Tax Appeals Commission Appeal No. TAC/IT/004/2011 Vs.

Commissioner General of Inland Revenue, Department of Inland Revenue, Sir Chittampalam A.

Gardiner Mawatha, Colombo 02. Respondent Before: Hon. D.N. Samarakoon, J.

Hon. Sasi Mahendran, J.

Counsel: Mr. Riad Ameen instructed by D. L. and F. de Saram for the Appellant.

Mr. Manohara Jayasinghe, D. S. G., for the Respondent.

Argued on: 03.08.2021 Written submission tendered on: 27.08.2019 by the Appellant.

30.08.2016 and 15.03.2022 by the Respondent.

Decided on: 08.08.2023 D.N. Samarakoon, J (01) Introduction:-

It is said, “The larger the depreciation expense, the lower the taxable income, and the lower a company’s tax bill. The smaller the depreciation expense, the higher the taxable income and the higher the tax payments owed¹” –

Investopedia This is also the common sense.

It is stated, in Written Submissions of the Appellant, The Wheel Works (Pvt) Ltd., dated 27.08.2019