COMMISSIONER OF INCOME TAX vs. RAJOO ENGINEERS LTD.

TAXAP/1309/2006HC GujaratGJHC24038279200630 November 2013Author: HONOURABLE MR. JUSTICE M.R. SHAH,HONOURABLE MR. JUSTICE R.P.DHOLARIA3 pages
AI SummaryDismissed

What were the facts?

The Commissioner of Income Tax (Revenue) filed an appeal before the High Court of Gujarat against an order dated March 1, 2006, passed by the Income Tax Appellate Tribunal (ITAT). The ITAT had dismissed the Revenue's appeal (ITA No. 1290/Rjt/2005) for Assessment Year 2001-02. The Revenue's appeal to the High Court was admitted on a substantial question of law concerning the deduction under Section 80HHC of the Income Tax Act, 1961. The amount in dispute before the ITAT was Rs. 1,44,190/-. The ITAT had dismissed the Revenue's appeal primarily on the ground of low tax effect, relying on a Circular of the Board dated October 24, 2005, although it also considered the merits of the case.

What did the High Court hold?

The High Court dismissed the appeal preferred by the Revenue on the ground of low tax effect. The Court noted that the amount in dispute was Rs. 1,44,190/-, and as per the Board's Circular dated October 24, 2005, such an appeal should not have been entertained unless a substantial question of law arose or it had an effect on subsequent assessment years, which was not the case here. The Court observed that the ITAT ought not to have gone into the merits of the case while dismissing the appeal on the ground of low tax effect. Consequently, the substantial question of law framed in the present appeal was kept open, and no opinion was expressed on the merits. The appeal was accordingly dismissed, and the notice was discharged without any order as to costs.

What were the issues?

1. Whether, on the facts and circumstances of the case, the Income Tax Appellate Tribunal was right in law and on facts in directing the Assessing Officer to grant deduction under Section 80HHC of the Income Tax Act, 1961, without excluding the deductions under Sections 80I and 80G of the Act? Assessee's Contention: The judgment does not record any specific contentions made by the assessee regarding the merits of the Section 80HHC deduction. The assessee's counsel appeared and was heard. Revenue's Contention: The Revenue contended that the ITAT erred in directing the grant of deduction under Section 80HHC without excluding deductions under Sections 80I and 80G. The Revenue preferred the appeal to the High Court on this substantial question of law.

Which sections of the Income-tax Act were involved?

Section 80HHC,Section 80I,Section 80G

AI-generated summary — verify with the full judgment below

O/TAXAP/1309/2006 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 1309 of 2006

FOR APPROVAL AND SIGNATURE:

HONOURABLE MR.JUSTICE M.R. SHAH

and HONOURABLE MR.JUSTICE R.P.DHOLARIA

================================================================ 1 Whether Reporters of Local Papers may be allowed to see the judgment ? 2 To be referred to the Reporter or not ? 3 Whether their Lordships wish to see the fair copy of the judgment ? 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India, 1950 or any order made thereunder ? 5 Whether it is to be circulated to the civil judge ? ================================================================ COMMISSIONER OF INCOME TAX Versus RAJOO ENGINEERS LTD ================================================================ Appearance: MR PRANAV G DESAI, ADVOCATE for the Appellant MR SN SOPARKAR, SENIOR ADVOCATE for the Respondent MRS SWATI SOPARKAR, ADVOCATE for the Respondent ================================================================ CORAM: HONOURABLE MR.JUSTIC

The order continues below.

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