PRINCIPAL COMMISSIONER OF INCOME TAX 3 vs. RAINBOW PAPERS LIMITED

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TAXAP/943/2018HC GujaratGJHC24036047201827 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 decided that the Tax Appeal is not pressed by the Revenue in view of the low tax effect, as per Circular No. 17/2019 dated August 8, 2019. The Court noted the monetary limits stipulated in the circular for appeals before different authorities, including Rs. 1,00,00,000 for appeals before the High Court. Consequently, the appeal was disposed of accordingly. The Court reserved the liberty for the Revenue to revive the Tax Appeal in case of any difficulty. No specific issue regarding the merits of the original assessment or the order under challenge was decided.

What were the facts?

The Principal Commissioner of Income Tax 3 (Revenue) filed a Tax Appeal before the Gujarat High Court against an order concerning Rainbow Papers Limited (Assessee). The appeal was listed for an appropriate order. The Registry notified the appeal due to its low tax effect. The Court was to consider Circular No. 17/2019, dated August 8, 2019, issued by the Central Board of Direct Taxes, which outlines monetary limits for filing appeals. The circular specifies 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 appeal was disposed of in light of this circular and the low tax effect.

What were the issues?

1. Whether the appeal should be entertained given the low tax effect, considering Circular No. 17/2019 issued by the CBDT? (Question of law) Assessee's Contention: The appeal is not pressed due to the low tax effect, in accordance with Circular No. 17/2019. The circular provides revised monetary limits for filing appeals, and this appeal falls below the threshold for High Court appeals (Rs. 1,00,00,000). Revenue's Contention: The revenue has not recorded any specific contention against the assessee's position. However, the appeal was filed by the Revenue, implying an initial intent to challenge the lower authority's order. The decision to not press the appeal is based on the subsequent circular.

AI-generated summary — verify with the full judgment below

C/TAXAP/943/2018                                                                                                 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO.  943 of 2018 ========================================================== PRINCIPAL COMMISSIONER OF INCOME TAX 3 Versus RAINBOW PAPERS LIMITED ========================================================== Appearance: MRS MAUNA M BHATT(174) for the Appellant(s) No. 1 MR TEJ  SHAH(5743) 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) 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 of Direct Taxes, New Delhi. 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 of Direct Taxes, New Delhi. Page  1 of  2

C/TAXAP/943/2018                                                                                                 ORDER According to the new policy, as reflected from the Circular referred to above, the table for monetary limits is as follows : Sr. No. Appeals/SLPs in Income-tax matters Monetary Limits (Rs.) 1 Before Appellate Tribunal 50,00,000 2 Before High Court 1,00,00,000 3 Before Supreme Court 2,00,00,000 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.) /MOINUDDIN Page  2 of  2

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