PRINCIPAL COMMISSIONER OF INCOME TAX vs. RACHANA CONSTRUCTION CO.

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TAXAP/913/2017HC GujaratGJHC24057187201707 January 2022Bench: HONOURABLE MR. JUSTICE J.B.PARDIWALA,HONOURABLE MS. JUSTICE NISHA M. THAKORE2 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court held that the appeal was not pressed by the Revenue due to its low tax effect, in accordance with Circular No. 17/2019. The circular establishes monetary limits for appeals before various judicial forums, including the High Court, where the limit is Rs. 1,00,00,000. Since the tax effect of this appeal was below the prescribed limit, the Revenue chose not to press it. Consequently, the appeal was disposed of on this basis. The Court explicitly reserved the liberty for the Revenue to revive the tax appeal in case of any difficulty. No decision was made on the merits of the original dispute.

What were the facts?

This matter concerns a Tax Appeal filed by the Principal Commissioner of Income Tax (Revenue) against Rachana Construction Co. (Assessee). The appeal was notified for an appropriate order due to its low tax effect. The High Court of Gujarat at Ahmedabad was considering the appeal. The Revenue indicated that the appeal was not pressed in light of Circular No. 17/2019, dated August 8, 2019, issued by the Central Board of Direct Taxes, which sets monetary limits for filing appeals. The circular outlines monetary limits for appeals before the Income Tax Appellate Tribunal (Rs. 50,00,000), High Court (Rs. 1,00,00,000), and Supreme Court (Rs. 2,00,00,000). The High Court reserved liberty for the Revenue to revive the appeal if any difficulty arose.

What were the issues?

1. Whether the appeal should be dismissed due to low tax effect, considering the CBDT Circular No. 17/2019? (Question of law) Assessee's Contention: The assessee did not explicitly argue any points as the appeal was not pressed by the Revenue. The judgment does not record any specific arguments from the assessee. Revenue's Contention: The Revenue argued that the appeal should be disposed of in view of the low tax effect, as per Circular No. 17/2019. The Revenue stated that the appeal was not pressed on this ground. The circular specifies monetary limits for appeals, and this appeal falls below the threshold for High Court appeals (Rs. 1,00,00,000).

AI-generated summary — verify with the full judgment below

C/TAXAP/913/2017 ORDER DATED: 07/01/2022 IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 913 of 2017 ========================================================== PRINCIPAL COMMISSIONER OF INCOME TAX Versus RACHANA CONSTRUCTION CO. ========================================================== Appearance: MR MANISH R. BHATT, SENIOR ADVOCATE FOR M R BHATT & CO. (5953) for the Appellant(s) No. 1 RULE SERVED(64) for the Opponent(s) No. 1 ========================================================== CORAM: HONOURABLE MR. JUSTICE J.B.PARDIWALA and HONOURABLE MS. JUSTICE NISHA M. THAKORE

Date : 07/01/2022

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 8 th 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 8 th 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/913/2017 ORDER DATED: 07/01/2022 Sr. No. Appeals/SLPs in Income-tax 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) (NISHA M. THAKORE,J) A. B. VAGHELA Page 2 of 2

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