COMMISSIONER OF INCOME TAX-II vs. ELECTRO FERRO ALLOYS (P) LTD

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TAXAP/1282/2011HC GujaratGJHC24045412201127 January 2020Bench: HONOURABLE MR. JUSTICE J.B.PARDIWALA,HONOURABLE MR. JUSTICE BHARGAV D. KARIA2 pages

AI SummaryWithdrawn

What did the High Court hold?

The High Court held that the appeal is not pressed and is disposed of in view of the low tax effect, as per Circular No. 17/2019 dated August 8, 2019. The court noted the monetary limits prescribed by the circular for appeals before the High Court (Rs. 1,00,00,000). The reasoning is that the appeal falls within the scope of the circular, which guides the Revenue's decision to withdraw or not press appeals with a low tax effect. The ratio decidendi is that appeals below the prescribed monetary threshold, as per CBDT circulars, are to be disposed of without detailed adjudication on merits. The operative direction is the disposal of the appeal, with liberty reserved for the Revenue to revive the tax appeal in case of any difficulty.

What were the facts?

The Commissioner of Income Tax-II (the Revenue) filed a Tax Appeal before the High Court of Gujarat at Ahmedabad against Electro Ferro Alloys (P) Ltd (the assessee). The appeal was notified for an appropriate order due to low tax effect. The Revenue decided not to press the appeal in light of Circular No. 17/2019 dated August 8, 2019, issued by the Central Board of Direct Taxes. This circular outlines monetary limits for filing appeals, with a limit of Rs. 1,00,00,000 for appeals before the High Court. The appeal was disposed of based on this circular, with liberty reserved for the Revenue to revive it in case of difficulty.

What were the issues?

1. Whether the appeal should be dismissed due to low tax effect, as per Circular No. 17/2019? (Question of law and fact) The Revenue argued that the appeal is not pressed in view of the low tax effect, citing Circular No. 17/2019. The circular establishes monetary limits for appeals, with Rs. 1,00,00,000 being the limit for appeals before the High Court. The Revenue relied on this circular to justify not pursuing the appeal. The assessee did not record any arguments in the judgment.

AI-generated summary — verify with the full judgment below

C/TAXAP/1282/2011 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 1282 of 2011 ========================================================== COMMISSIONER OF INCOME TAX-II Versus ELECTRO FERRO ALLOYS (P) LTD ========================================================== Appearance: MRS MAUNA M BHATT(174) for the Appellant(s) No. 1 MRS SWATI SOPARKAR(870) for the Opponent(s) No. 1 ========================================================== CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA and HONOURABLE MR. JUSTICE BHARGAV D. KARIA

Date : 27/01/2020

ORAL ORDER (PER : HONOURABLE MR.JUSTICE J.B.PARDIWALA) 1. The Registry has notified the appeal for the purpose of passing an appropriate order. The captioned appeal has been notified because of the low tax effect. The appeal is to be disposed of keeping in mind the Circular No.17/2019, dated 8th August, 2019 issued by the Government of India, Ministry of Finance, Department of Revenue, Central Board Direct Taxes, New Delhi. 2. This tax appeal is not pressed in view of the low tax effect having regard to the Circular No.17/2019, dated 8th August, 2019 issued by the Government of India, Ministry of Finance, Department of Revenue, Central Board Direct Taxes, New Delhi. 3. According to the new policy as reflected from the Circular referred to above, the table for monetary limits is as follows: Page 1 of 2

C/TAXAP/1282/2011 ORDER Sr. No. Appeals/SLPs in Incometax matters Monetary Limit (Rs.) 1 Before Appellate Tribunal 50,00,000 2 Before High Court 1,00,00,000 3 Before Supreme Court 2,00,00,000 4. In view of the aforesaid, the appeal is disposed of accordingly. In case of any difficulty, we reserve the liberty for the Revenue to revive the tax appeal. (J. B. PARDIWALA, J) (BHARGAV D. KARIA, J) aruna Page 2 of 2

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