DEPUTY COMMISSIONER OF INCOME TAX vs. M/S NARMADA DRINKS PVT LTD.

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TAXC/104/2024HC ChhattisgarhCGHC01010508202414 October 2024Author: HON'BLE SHRI JUSTICE SANJAY K. AGRAWAL,HON'BLE SHRI JUSTICE AMITENDRA KISHORE PRASAD3 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court held that the submission made by the learned counsel for the appellant (Revenue) was fair and reasonable. The Court noted that the monetary limit for filing appeals before the High Court has been enhanced to Rs. 2 Crores by the circular dated 17.09.2024. Since the tax liability in the present case is less than Rs. 2 Crores, and in light of paragraph 5 of the said circular which allows for withdrawal of pending appeals, the Court disposed of the Tax Case as withdrawn. The operative direction was to dispose of the appeal as withdrawn. No specific issue was left undecided, as the appeal was withdrawn based on the circular.

What were the facts?

The appellant, Deputy Commissioner of Income Tax, Circle-1, Bilaspur, filed a Tax Case before the High Court of Chhattisgarh at Bilaspur. The respondent is M/s Narmada Drinks Pvt Ltd. The assessment year in question is 2015-16. The appeal was filed by the Revenue. The counsel for the appellant submitted that a new circular dated 17.09.2024 has been issued by the Ministry of Finance, enhancing the monetary limit for filing Income Tax Appeals by the department before the High Court to Rs. 2 Crores. The tax liability in the present case is stated to be less than Rs. 2 Crores. The respondent was not represented.

What were the issues?

1. Whether the present appeal, filed by the Revenue, should be disposed of in light of the new circular dated 17.09.2024 issued by the Ministry of Finance, which enhances the monetary limit for filing appeals before the High Court to Rs. 2 Crores, given that the tax effect in this case is less than the enhanced limit? (Question of law, based on interpretation of the circular and its applicability). Assessee's Contention: The Revenue, through its counsel, argued that the appeal may be disposed of finally in light of the new circular dated 17.09.2024, as the tax liability in the present case is less than the enhanced monetary limit of Rs. 2 Crores. They relied on paragraph 5 of the circular, which states that pending appeals may be withdrawn. Revenue's Contention: Not recorded, as the Revenue is the appellant.

Which sections of the Income-tax Act were involved?

Section 268A

AI-generated summary — verify with the full judgment below

1 / 3 2024:CGHC:40278-DB NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR TAXC No. 104 of 2024 1 - Deputy Commissioner Of Income Tax Circle-1 (1), Aayakar Bhawan, Mahima Complex, Bilaspur, Chhattisgarh.

... Appellant versus 1 - M/s Narmada Drinks Pvt Ltd. Sirgitti Industrial Area, Tifra, Bilaspur (C.G.) Pan- Aaacn5880c, A.Y. 2015-16. ... Respondent (Cause-title taken from Case Information System) For Petitioner : Mr. Amit Chaudhari, Advocate and Mr. Vijay Chawla, Advocate For Respondent : None Division Bench Hon'ble Shri Justice Sanjay K. Agrawal & Hon'ble Shri Justice Amitendra Kishore Prasad Order on Board (15/10/2024) Sanjay K. Agrawal, J.

1.

When case is taken for hearing and learned counsel for the appellant would submit that the Government of India, Ministry of Finance has issued a new circular dated 17.09.2024, in which monetary limits for 2 / 3 filing Income Tax Appeals by the department before the High Court has been enhanced to Rs.2 Crores, whereas in the present case the tax liability of assess is less than Rs.2 Crore. Therefore, in light of aforesaid circular dated 17/09/2024, the present appeal may be disposed of finally.

2.

The said prayer appears to be fair and reasonable.

3.

For ready reference, relevant paragraphs of said circular dated 17/09/2024 is quoted hereinbelow :

“1. Reference is invited to Circular No 5/2024 (F.No.279/Misc.142/2007-ITJ(Pt))dated15.03.2024

of Central Board of Direct Taxes (the 'Board') vide which monetary limits for filing of income tax appeals by the Department before Income Tax Appellate Tribunal, High Courts and SLP/appeals before Supreme Court have been specified. Further, exceptions to the monetary limits were also specified vide paras 3.1 and 3.2 of the said Circular.

2.

As a step towards management of litigation, it has been decided by the Board to revise the monetary limits for filing of appeals in Income-tax cases as stated in Para 4.1 of the aforementioned Circular as follows:- S. No. Appeals/SLPs in Income-tax matters Monetary Limit (Tax effect in Rs.)

1.

Before Income Tax Appellate Tribunal 60 lakh

2.

Before High Court 2 crore

3.

Before Supreme Court 5 crore

3.

Monetary limits given in paragraph 2 above with regard to filing appeal/SLP shall be applicable to all cases including those relating to TDS/TCS under the Income-tax Act, 1961 with exceptions as per paras 3.1

3 / 3 and 3.2 of Circular No 5/2024 dated 15.03.2024, where the decision to appeal/file SLP shall be taken on merits, without regard to the tax effect and the monetary limits.

4.

It is clarified that an appeal should not be filed merely because the tax effect in a case exceeds the monetary limits prescribed above. Filing of appeal in such cases is to be decided on merits of the case. The officers concerned shall keep in mind the overall objective of reducing unnecessary litigation and providing certainty to taxpayers on their Income-tax assessments while taking a decision regarding filing an appeal.

5.

The modifications shall come into effect from the date of issue of this Circular. This Circular will apply to SLPs/appeals to be filed henceforth in SC/HCs/Tribunal. It shall also apply to the SLPs/ appeals pending before Supreme Court/High Courts/Tribunal, which may accordingly be withdrawn.

6.

The above may be brought to the notice of all concerned.

7.

This issues under section 268A of the Income-tax Act, 1961. 8. Hindi version will follow. ”

4.

In view aforesaid submission of learned counsel for the appellant where monetary limit (tax liability) in the present case is less than Rs.2 Crores therefore, in light of aforesaid circular (Para-5) dated 17/09/2024, the instant Tax Case stands disposed of as withdrawn. (Sanjay K. Agrawal) (Amitendra Kishore Prasad)

Judge

Judge Ravi Mandavi

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