DY. CIT. vs. PHELIX APPLICANCES LTD.
What did the High Court hold?
The High Court held that the ITAT was correct in dismissing the appeal without adjudicating on merits. The Court noted that the amount involved in the present case was small, with a revenue effect less than Rs. 1 lakh. Referring to CBDT Instruction No. 1979 dated 27th March, 2000 and Instruction No. 02 of 2005, the Court stated that the Revenue ought not to have filed an appeal where the total revenue effect is less than Rs. 1 lakh. Consequently, the appeal was not entertained. The substantial question of law was 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 revive the appeal in case of difficulty.
What were the facts?
The Revenue, identified as the Dy. CIT, filed an appeal before the High Court of Gujarat challenging an order dated 02.08.2006 passed by the Income-tax Appellate Tribunal (ITAT), Ahmedabad Bench. The ITAT's order pertained to ITA No. 2113/Ahd/2002 for the assessment year 1998-99. The High Court admitted the appeal on 14.09.2007 and framed a substantial question of law. The opponent in the appeal is Phelix Appliances Ltd. The procedural history involves the Revenue's appeal to the High Court after the ITAT's decision.
What were the issues?
1. Whether the Appellate Tribunal is right in law and on facts in dismissing the appeal filed by the Revenue without adjudicating the same on merits on the ground that since in the appeal, tax effect was below Rs. 2 lakh, the revenue could not have preferred the same in view of the instructions of the CBDT, thereby entitling the Hon’ble Tribunal not to decide the same on merits? Assessee's contention: The judgment does not record any specific contentions made by the assessee. However, the High Court's decision implies that the assessee would have supported the ITAT's dismissal on the grounds of low tax effect. Revenue's contention: The Revenue contended that the ITAT was wrong in dismissing their appeal without adjudicating it on merits, solely based on the tax effect being below Rs. 2 lakh, as per CBDT instructions. The Revenue likely argued that the merits of the case should have been considered.
AI-generated summary — verify with the full judgment below
O/TAXAP/523/2007 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD TAX APPEAL NO. 523 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 ? ================================================================ DY. CIT.....Appellant(s) Versus PHELIX APPLICANCES LTD.....Opponent(s) ================================================================ Appearance: MR KM PARIKH, ADVOCATE for the Appellant(s) No. 1 RULE SERVED for the Opponent(s) No. 1 ================================================================ CORAM: HONOURABLE MR.JUSTICE KS JHAVERI and HONOURABLE MR.JUSTICE K.J.THAKER
Date : 11/12/2014 Page 1 of 3
O/TAXAP/523/2007 JUDGMENT
ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) 1. By way of this appeal, the appellant-revenue has challenged the order dated 02.08.2006 passed by the Income-tax Appellate Tribunal, Ahmedabad Bench in ITA No. 2113/Ahd/2002 for the assessment year 1998-99. 2. While admitting this appeal on 14.09.2007, this Court has framed the following substantial question of law: Whether the Appellate Tribunal is right in law and on facts in dismissing the appeal filed by the Revenue without adjudicating the same on merits on the ground that since in the appeal, tax effect was below Rs. 2 lakh, the revenue could not have preferred the same in view of the instructions of the CBDT, thereby entitling the Hon’ble Tribunal not to decide the same on merits? 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. (K.S.JHAVERI, J.) Page 2 of 3
O/TAXAP/523/2007 JUDGMENT (K.J.THAKER, J) divya Page 3 of 3
Latest GST High Court judgments
Search GST case law →- M/S Sahoo Supply Agency,Balasore vs. Central Board Of Indirect Taxes And Customs,New DelhiOrissa · 3 Nov 2026
- M/S Jyoti Consultants, Agrahat vs. Pr. Commissioner GST And Central Excise Commissionerate, BhubaneswarOrissa · 3 Nov 2026
- M/S. Sahoo Supply Agency vs. Central Board Of Indirect Taxes And CustomsOrissa · 3 Nov 2026
- Gopal Aromatic PVT. LTD., Cuttack vs. Union Of INDIAOrissa · 3 Nov 2026
- M/S. Nourangi Paints vs. The Union Of INDIAPatna · 2 Nov 2026
