COMMISSIONER OF INCOME TAX vs. KHEMANI DISTILLERIES PVT LTD

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TAXAP/1313/2009HC GujaratGJHC24040984200914 September 2022Bench: HONOURABLE THE CHIEF JUSTICE MR. JUSTICE ARAVIND KUMAR,HONOURABLE MR. JUSTICE ASHUTOSH SHASTRI2 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court held that the appeal would not survive for consideration due to the low tax effect, which is below the monetary limit fixed by CBDT Circular No. 17 of 19 dated 08.08.2019. The Tribunal's order is therefore disposed of on this ground. The Court clarified that the question of law raised in the appeal remains open. The judgment explicitly states that if the appeal falls under any exception carved out in the said circulars, either party can seek revival of the appeal by filing an appropriate note. The ratio is that appeals with a tax effect below the prescribed monetary limits are not maintainable unless they fall under specific exceptions, and such appeals can be disposed of without deciding the merits, with liberty to seek revival.

What were the facts?

This is an appeal by the assessee, Commissioner of Income Tax, against an order of the Income Tax Appellate Tribunal (ITAT). The appeal concerns assessment year(s) not specified in the judgment. The core issue revolves around an order passed by the Assessing Officer and a consequential demand. The judgment notes that the tax effect arising from this demand is below the monetary limit prescribed by Circular No. 17 of 19 dated 08.08.2019, issued by the Central Board of Direct Taxes (CBDT). Consequently, the appeal would not ordinarily be maintainable. The procedural history indicates that the ITAT's order is the subject of this appeal.

What were the issues?

1. Whether the appeal is maintainable before this Court given that the tax effect is below the monetary limit prescribed by CBDT Circular No. 17 of 19 dated 08.08.2019? (Question of law) Assessee's Contention: The assessee (Commissioner of Income Tax) implicitly argues for the appeal to be heard on merits, as they are the appellant. However, the judgment focuses on the revenue's (Commissioner's) position regarding the tax effect. Revenue's Contention: The judgment does not explicitly record arguments from the revenue. However, the operative part of the judgment indicates that the appeal is disposed of due to low tax effect, implying that the revenue's position, or the factual situation regarding the tax effect, led to this conclusion.

AI-generated summary — verify with the full judgment below

C/TAXAP/1313/2009 JUDGMENT DATED: 14/09/2022 IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 1313 of 2009

FOR APPROVAL AND SIGNATURE:

HONOURABLE THE CHIEF JUSTICE MR. JUSTICE ARAVIND KUMAR and HONOURABLE MR. JUSTICE ASHUTOSH J. SHASTRI ============================================= 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 or any order made thereunder ? ============================================= COMMISSIONER OF INCOME TAX Versus KHEMANI DISTILLERIES PVT LTD ============================================= Appearance: MR MR BHATT SR. ADVOCATE with MR KARAN SANGANI for M R BHATT & CO.(5953) for the Appellant(s) No. 1 MR BANDISH SOPARKAR for MRS SWATI SOPARKAR(870) for the Opponent(s) No. 1 ============================================= CORAM:HONOURABLE THE CHIEF JUSTICE MR. JUSTICE ARAVIND KUMAR and HONOURABLE MR. JUSTICE ASHUTOSH J. SHASTRI

Date : 14/09/2022

ORAL JUDGMENT (PER : HONOURABLE THE CHIEF JUSTICE MR. JUSTICE ARAVIND KUMAR) 1. This appeal by the assessee is directed against the order of the Income Tax Appellate Tribunal. The order passed by the Page 1 of 2

C/TAXAP/1313/2009 JUDGMENT DATED: 14/09/2022 Assessing Officer and the consequential demand, notice issued thereunder would indicate that the tax effect is less than the monetary limit fixed under extant Circulars/Notifications issued by the Central Board of Direct Taxes (CBDT), by virtue of which the appeal would not survive for consideration in light of the low effect of tax prescribed under the said Notifications namely Circular No. 17 of 19 dated 08.08.2019. Hence, appeal stands disposed of as having low tax effect and keeping open the question of law raised in the appeal. However, it is made clear that in the event of this appeal falling under the category of any exception carved out under the said extant Circulars, either of the parties would be at liberty to seek for revival of this appeal by filing appropriate note in the Registry. (ARAVIND KUMAR,CJ) (ASHUTOSH J. SHASTRI, J) phalguni Page 2 of 2

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