COMMISSIONER OF INCOME TAX-II vs. M/S METROCHEM INDUSTRIES LTD.

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TAXAP/2040/2010HC GujaratGJHC24046324201009 September 2019Bench: HONOURABLE MR. JUSTICE J.B.PARDIWALA,HONOURABLE MR. JUSTICE A.C. RAO2 pages

AI SummaryWithdrawn

What did the High Court hold?

The High Court held that the Tax Appeal was not pressed by the revenue in view of the low tax effect, as per Circular No. 17/2019. The court acknowledged the new policy reflected in the circular, which sets monetary limits for appeals. Specifically, for appeals before the High Court, the monetary limit is Rs. 1,00,00,000. Since the present appeal fell under the category of low tax effect, it was disposed of accordingly. The court also reserved the liberty for the Revenue to revive the tax appeal in case of any difficulty. No specific findings were made on the merits of the original dispute.

What were the facts?

The Gujarat High Court was considering a Tax Appeal filed by the Commissioner of Income Tax-II against M/s Metrochem Industries Ltd. The appeal was listed for an appropriate order due to a low tax effect. The court noted that the appeal was to be disposed of in light of Circular No. 17/2019, dated August 8, 2019, issued by the Central Board of Direct Taxes. This circular outlines new monetary limits for filing appeals. The court also referred to a table within the circular detailing these limits for appeals before the Income Tax Appellate Tribunal, High Court, and Supreme Court.

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, turning on the interpretation and application of the circular). Assessee's Contention: The assessee did not explicitly argue any points as the appeal was not pressed. However, the underlying reason for not pressing the appeal was the low tax effect, aligning with the policy outlined in Circular No. 17/2019. Revenue's Contention: The revenue, through the appeal, sought to challenge the order of the lower authority. However, in view of the Circular No. 17/2019 and the low tax effect, the appeal was not pressed by the revenue.

AI-generated summary — verify with the full judgment below

C/TAXAP/2040/2010 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 2040 of 2010 ========================================================== COMMISSIONER OF INCOME TAX-II Versus M/S METROCHEM INDUSTRIES LTD. ========================================================== Appearance: MRS MAUNA M BHATT(174) for the Appellant(s) No. 1 MR RK PATEL(1082) for the Opponent(s) No. 1 ========================================================== CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA and HONOURABLE MR.JUSTICE A.C. RAO

Date : 09/09/2019

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/2040/2010 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) (A. C. RAO, J) aruna Page 2 of 2

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