CIT vs. MERCANTILE CAPITAL & FINANCIAL SERVICES PVT LTD

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ITA/1272/2011HC DelhiDLHC01173493201119 December 2011Bench: HON'BLE MR. JUSTICE SANJIV KHANNA,HON'BLE MR. JUSTICE R.V.EASWAR1 pages
AI SummaryDismissed

What did the High Court hold?

The High Court of Delhi held that the writ petition had become infructuous. This conclusion was reached because the related appeal filed by the Revenue (ITA No. 1558/2010) had been dismissed as not pressed. The reason for the dismissal of the Revenue's appeal was that the tax effect was less than Rs. 20 lacs, which is a threshold for the Revenue to pursue appeals. Since the linked appeal was not pressed, the Court found no reason to proceed with the writ petition. As there was no appearance on behalf of the petitioner, the Court dismissed the writ petition in default. No specific finding was made on the validity or interpretation of Section 185 of the Income Tax Act, 1961, as the matter was disposed of on procedural grounds.

What were the facts?

This writ petition, W.P.(C) 1272/2011, was filed by Sahni Natarajan and Bahl. The petition challenged the provision of Section 185 of the Income Tax Act, 1961. The High Court of Delhi had previously adjourned the hearing of this writ petition on February 25, 2011, with a direction to link it with ITA No. 1558/2010, which was filed by the Revenue. The Revenue later dismissed ITA No. 1558/2010 as not pressed because the tax effect in that appeal was less than Rs. 20 lacs. Consequently, the High Court noted that the present writ petition had become infructuous.

What were the issues?

1. Whether the writ petition challenging Section 185 of the Income Tax Act, 1961, has become infructuous, given that a related appeal by the Revenue was dismissed as not pressed due to low tax effect. (Question of law) Assessee's Contentions: No arguments were recorded for the assessee (petitioner) as there was no appearance on their behalf. Revenue's Contentions: The Revenue had filed ITA No. 1558/2010, which was linked to this writ petition. The Revenue dismissed this appeal as not pressed because the tax effect was below Rs. 20 lacs, implying the underlying issue in the writ petition may no longer be pursued by the Revenue.

Which sections of the Income-tax Act were involved?

Section 185

AI-generated summary — verify with the full judgment below

$~R-8 * IN THE HIGH COURT OF DELHI AT NEW DELHI + W.P.(C) 1272/2011

SAHNI NATARAJAN AND BAHL

..... Petitioner

Through: None

versus

UOI AND ORS

..... Respondents

Through: Mr. Ruchir Bhatia, Advocate

CORAM: HON'BLE MR. JUSTICE SANJIV KHANNA HON'BLE MR. JUSTICE CHANDER SHEKHAR

O R D E R %

04.09.2018

This writ petition was adjourned for hearing vide order dated 25.02.2011 with the direction that the writ would be linked with ITA No. 1558/2010 filed by Revenue. It is noticed that the aforesaid ITA No. 1558/2010 was dismissed as not pressed by the Revenue as the tax effect in appeal was less than Rs. 20 lacs. It accordingly appears that the present writ petition challenging provision of Section 185 of the Income Tax Act, 1961 has become infructuous. This being the position, and as there is no appearance on behalf of the petitioner, the same is dismissed in default.

SANJIV KHANNA, J

CHANDER SHEKHAR, J SEPTEMBER 04, 2018/P

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