PR. COMMISSIONER OF INCOME TAX - VADODARA -1 vs. GULBRANDSEN CHEMICALS PVT. LTD

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TAXAP/552/2017HC GujaratGJHC24057007201729 January 2019Bench: HONOURABLE MS. JUSTICE HARSHA DEVANI,HONOURABLE DR. JUSTICE A. P. THAKER2 pages
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What did the High Court hold?

The High Court held that since the tax effect involved in the appeal is less than Rs. 50,00,000/-, and in light of CBDT Circular No. 3/2018 dated 11th July, 2018, which mandates that no appeal with a tax effect not exceeding Rs. 50,00,000/- shall be filed before the High Court and has retrospective applicability, the learned senior standing counsel for the appellant (Revenue) does not press the present appeal. Consequently, the appeal is disposed of as not pressed. The Court also noted that if there is any error in the computation of the tax effect or if the circular is not applicable for any reason, the appellant would be at liberty to seek revival of the appeal. No specific finding was made on the merits of the original appeal.

What were the facts?

This is an appeal filed by the Principal Commissioner of Income Tax - Vadodara -1 (the Revenue) against Gulbrandsen Chemicals Pvt. Ltd (the Assessee). The appeal is before the High Court of Gujarat at Ahmedabad. The assessment year(s) are not specified. The order or action under challenge is the appeal itself. The procedural history is that the appeal was filed by the Revenue. During the hearing, it was admitted by both parties that the tax effect involved in the appeal is less than Rs. 50,00,000/-.

What were the issues?

1. Whether the present appeal, involving a tax effect less than Rs. 50,00,000/-, is maintainable before the High Court, in light of CBDT Circular No. 3/2018 dated 11th July, 2018? (Question of law) The Revenue's contention, as presented by Mr. Varun K. Patel, learned Senior Standing Counsel, is that the appeal is not pressed due to the tax effect being below the monetary limit stipulated in CBDT Circular No. 3/2018, which is also retrospectively applicable to pending appeals. The Assessee, through Mr. B. S. Soparkar, learned advocate, does not appear to have raised any specific arguments against this position, but rather the appeal is being disposed of based on the Revenue's stance and the circular.

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C/TAXAP/552/2017 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 552 of 2017 ========================================================== PR. COMMISSIONER OF INCOME TAX - VADODARA -1 Versus GULBRANDSEN CHEMICALS PVT. LTD ========================================================== Appearance: MR.VARUN K.PATEL(3802) for the APPELLANT MR B S SOPARKAR(6851) for the RESPONDENT(s) No. 1 ========================================================== CORAM: HONOURABLE MS.JUSTICE HARSHA DEVANI and HONOURABLE DR.JUSTICE A. P. THAKER

Date : 29/01/2019

ORAL ORDER (PER : HONOURABLE MS.JUSTICE HARSHA DEVANI) 1. Heard Mr. Varun K. Patel, learned Senior Standing Counsel for the appellant and Mr. B. S. Soparkar, learned advocate for the respondent. 2. It is an admitted position between the parties that the tax effect involved in this appeal is less than Rs.50,00,000/-. Under the circumstances, in the light of the Circular No.3/2018 dated 11th July, 2018 issued by the Government of India, Ministry of Finance, Department of Revenue, Central Board of Direct Taxes which provides that no appeal wherein the tax effect does not exceed the monetary limit of Rs.50,00,000/- shall be filed before the High Court and has also been made retrospectively applicable to pending appeals, the learned senior standing counsel for the appellant does not press the present appeal. Page 1 of 2

C/TAXAP/552/2017 ORDER 3. The appeal is accordingly disposed of as not pressed in the light of the Circular dated 11th July, 2018. However, in case there is any error in the computation of the tax effect involved or if for any reason, the circular is not applicable, it would be open for the appellant to seek revival of the appeal. (HARSHA DEVANI, J) (A. P. THAKER, J) V.R. PANCHAL Page 2 of 2

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