THE COMMISSIONER OF INCOME TAXAHMEDABAD-IV vs. SHREE PRAKASH TEXTILES (GUJARAT) LTD.
What did the High Court hold?
The High Court did not decide the substantial question of law on its merits. Instead, the Court noted that the revenue effect of the disputed amount was less than Rs. 1 lakh. Citing CBDT Instruction No. 1979 dated March 27, 2000, and Instruction No. 02 of 2005, which stipulate that appeals should not be filed where the total revenue effect is less than Rs. 1 lakh, the Court decided not to entertain the appeal. Consequently, the questions were answered in favour of the assessee and against the revenue. The appeal was dismissed on the ground of the smallness of the amount. Liberty was granted to the revenue to revive the appeal in case of difficulty. No specific finding was given on the merits of the disallowance of depreciation and expenses.
What were the facts?
The Commissioner of Income Tax (Revenue) appealed against an order dated December 22, 2006, passed by the Income-tax Appellate Tribunal (ITAT), Ahmedabad Bench 'D'. The appeal concerned assessment year 2003-04. The High Court admitted the appeal on December 26, 2007, and framed a substantial question of law. The dispute involved the deletion of disallowance of depreciation and expenses on a car by the CIT(A), which was confirmed by the ITAT, on the grounds that the car was not registered in the name of the assessee company, Shree Prakash Textiles (Gujarat) Ltd. The revenue effect of the disputed amount was less than Rs. 1 lakh.
What were the issues?
1. Whether the Appellate Tribunal was right in law and on facts in confirming the order passed by the CIT(A) deleting the disallowance of depreciation and expenses on car made by the Assessing Officer on the ground that the car was not in the name of the assessee company? (Question of law and fact, concerning provisions related to depreciation and business expenses). Assessee's Contention: The judgment does not record any specific contentions made by the assessee before the High Court. However, the ITAT's decision, which was confirmed, implies that the assessee likely argued that the disallowance was incorrect. Revenue's Contention: The revenue's primary contention, as reflected in the question of law, is that the disallowance made by the Assessing Officer should have been upheld because the car was not in the name of the assessee company, and therefore, depreciation and expenses related to it should not be allowed.
AI-generated summary — verify with the full judgment below
O/TAXAP/1238/2007 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 1238 of 2007
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR.JUSTICE KS JHAVERI
and HONOURABLE MR.JUSTICE K.J.THAKER
================================================================ 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 ? ================================================================ THE COMMISSIONER OF INCOME TAXAHMEDABAD-IV....Appellant(s) Versus SHREE PRAKASH TEXTILES (GUJARAT) LTD.....Opponent(s) ================================================================ Appearance: MR NITIN K MEHTA, ADVOCATE for the Appellant(s) No. 1 MR BS SOPARKAR, ADVOCATE FOR MRS SWATI SOPARKAR, ADVOCATE for the Opponent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE KS JHAVERI and Page 1 of 3
O/TAXAP/1238/2007 JUDGMENT HONOURABLE MR.JUSTICE K.J.THAKER
Date : 24/12/2014
ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1. By way of this appeal, the appellant-revenue has challenged the judgment and order dated 22.12.2006 passed by the Income-tax Appellate Tribunal, Ahmedabad Bench ‘D’ in ITA No. 2007/Ahd/2006 for the assessment year 2003-04. 2. While admitting this appeal on 26.12.2007, this Court has framed the following substantial question of law: Whether the Appellate Tribunal was right in law and on facts in confirming the order passed by the CIT(A) deleting the disallowance of depreciation and expenses on car made by the Assessing Officer on the ground that the car was not in the name of the assessee company? 3. In our view, the amount involved in the present case is a small one and the revenue effect is less than Rs. 1 lakh, and therefore, as per CDBT Instruction No. 1979 dated 27th March, 2000 and 02 of 2005, the revenue ought not to have come in appeal where the total revenue effect is less than Rs. 1 lakh, and therefore, this appeal is not entertained. The questions are answered in favour of the assessee and against the revenue. This appeal is dismissed on the ground of smallness of amount. Liberty to revive in case of difficulty. Page 2 of 3
O/TAXAP/1238/2007 JUDGMENT (K.S.JHAVERI, J.) (K.J.THAKER, J) divya Page 3 of 3
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