COMMISSIONER OF INCOME TAX II vs. GMM PFAULDER LTD

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TAXAP/1149/2014HC GujaratGJHC24045223201427 January 2020Bench: HONOURABLE MR. JUSTICE J.B.PARDIWALA,HONOURABLE MR. JUSTICE BHARGAV D. KARIA2 pages

AI SummaryWithdrawn

What did the High Court hold?

The High Court of Gujarat at Ahmedabad disposed of the Tax Appeal. The decision was based on Circular No. 17/2019, which sets monetary limits for appeals. The Revenue chose not to press the appeal due to the low tax effect, aligning with the policy outlined in the circular. The monetary limit for appeals before the High Court, as per the circular, was Rs. 1,00,000. The Court granted liberty to the Revenue to revive the appeal if any difficulty arose. The core principle applied is that appeals with a low tax effect, as defined by the CBDT's circular, may not be pursued, thereby streamlining litigation and conserving resources.

What were the facts?

The Commissioner of Income Tax II (the Revenue) filed a Tax Appeal before the High Court of Gujarat at Ahmedabad against GMM Pfaudler Ltd (the assessee). The appeal was notified for an appropriate order due to low tax effect. The Revenue decided not to press the appeal in light of Circular No. 17/2019 dated August 8, 2019, issued by the Central Board of Direct Taxes. This circular outlines revised monetary limits for filing appeals. The appeal was disposed of accordingly, with liberty reserved for the Revenue to revive it in case of difficulty.

What were the issues?

1. Whether the appeal should be dismissed due to low tax effect in light of Circular No. 17/2019? Assessee's Contentions: The judgment does not record any specific contentions from the assessee. However, the appeal was not pressed by the Revenue. Revenue's Contentions: The Revenue did not press the appeal in view of the low tax effect, as per Circular No. 17/2019. This circular establishes monetary limits for appeals before various authorities, including the High Court, which was Rs. 1,00,000. The appeal was filed by the Revenue, and its decision not to press it implies an acceptance of the low tax effect threshold.

AI-generated summary — verify with the full judgment below

C/TAXAP/1149/2014 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 1149 of 2014 ========================================================== COMMISSIONER OF INCOME TAX II Versus GMM PFAULDER LTD ========================================================== Appearance: MRS MAUNA M BHATT(174) for the Appellant(s) No. 1 MR B S SOPARKAR(6851) for the Opponent(s) No. 1 ========================================================== CORAM: HONOURABLE MR.JUSTICE J.B.PARDIWALA and HONOURABLE MR. JUSTICE BHARGAV D. KARIA

Date : 27/01/2020

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/1149/2014 ORDER Sr. No. Appeals/SLPs in Incometax matters Monetary Limit (Rs.) 1 Before Appellate Tribunal 50,00,000 2 Before High Court 1,00,000 3 Before Supreme Court 2,00,000 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) (BHARGAV D. KARIA, J) CHANDRESH Page 2 of 2

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