COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATIO AND TRANSFER PRICING) vs. CADILA HEALTHCARE LTD

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TAXAP/624/2017HC GujaratGJHC24057041201717 December 2018Bench: HONOURABLE MS. JUSTICE HARSHA DEVANI,HONOURABLE DR. JUSTICE A. P. THAKER2 pages
AI SummaryWithdrawn

What did the High Court hold?

The Tribunal held that the tax effect involved in the appeal is less than Rs. 50,00,000/-. In light of Circular No. 3/2018 dated 11th July, 2018, which stipulates that no appeal where the tax effect does not exceed Rs. 50,00,000/- shall be filed before the High Court, and considering its retrospective applicability to pending appeals, the learned senior standing counsel for the appellant (revenue) did not press the appeal. Consequently, the appeal was disposed of as not pressed. The court also noted that if there was any error in the computation of the tax effect or if the circular was not applicable for any reason, the appellant would have the liberty to seek revival of the appeal.

What were the facts?

This case involves an appeal filed by the Commissioner of Income Tax (International Taxation and Transfer Pricing) against Cadila Healthcare Ltd. The appeal was filed before the High Court of Gujarat at Ahmedabad. The core of the matter revolves around the tax effect involved in the appeal. It is an admitted position between the parties that the tax effect is less than Rs. 50,00,000/-. This fact is crucial as it relates to the applicability of a specific circular issued by the Central Board of Direct Taxes.

What were the issues?

1. Whether the present appeal, with 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? The assessee (Cadila Healthcare Ltd.) did not present any arguments as the appeal was not pressed by the revenue. The revenue (Commissioner of Income Tax) argued that under Circular No. 3/2018, appeals with a tax effect not exceeding Rs. 50,00,000/- should not be filed before the High Court. The circular has also been made retrospectively applicable to pending appeals. Therefore, the revenue did not press the present appeal.

AI-generated summary — verify with the full judgment below

C/TAXAP/624/2017 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 624 of 2017 ========================================================== COMMISSIONER OF INCOME TAX (INTERNATIONAL TAXATIO AND TRANSFER PRICING) Versus CADILA HEALTHCARE LTD ========================================================== Appearance: MR.VARUN K.PATEL(3802) for the PETITIONER(s) No. 1 DARSHAN R PATEL(8486) for the RESPONDENT(s) No. 1 ========================================================== CORAM: HONOURABLE MS.JUSTICE HARSHA DEVANI and HONOURABLE DR.JUSTICE A. P. THAKER

Date : 17/12/2018

ORAL ORDER (PER : HONOURABLE MS.JUSTICE HARSHA DEVANI) 1. Heard Mr.Varun Patel, learned Senior Standing Counsel for the appellant and Mr.Darshan Patel, 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/624/2017 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) Vijay Page 2 of 2

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