PRINCIPAL COMMISSIONER OF INCOME TAX 5 KOLKATA vs. M/S ACCLARIS BUSINESS SOLUTIONS P LTD
What did the High Court hold?
The High Court held that the appeal filed by the Department under Section 260A of the Income Tax Act, 1961, could not be pursued further because the tax effect involved was less than the threshold limit stipulated in the circular issued by the CBDT. Consequently, the appeal was disposed of on the ground of low tax effect. The Court explicitly stated that the substantial questions of law were left open, meaning they were not decided on their merits. No operative directions regarding the assessment itself were issued.
What were the facts?
The appeal was filed by the Principal Commissioner of Income Tax-5, Kolkata (the revenue) under Section 260A of the Income Tax Act, 1961, against an order dated October 20, 2020, passed by the Income Tax Appellate Tribunal, "C" - Bench, Kolkata. The assessment year in question is 2010-11. The assessee is M/s. Acclaris Business Solutions P Ltd. The appeal was heard by the High Court at Calcutta. The Court noted that the tax effect involved in the appeal was below the threshold limit specified in a CBDT circular.
What were the issues?
1. Whether the appeal filed by the revenue is maintainable given the tax effect involved? Assessee's Contention: The judgment does not record any specific contentions made by the assessee regarding the maintainability of the appeal or the merits of the case. The assessee was represented by Mr. Pratyush Jhunjhunwala, Adv. Revenue's Contention: The revenue, represented by Mr. Prithu Dudhoria, Adv., filed the appeal under Section 260A of the Income Tax Act, 1961. The revenue's primary action was to file the appeal, and the subsequent decision was based on a procedural ground related to tax effect, not on the merits of the substantial questions of law.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
OD – 2
IN THE HIGH COURT AT CALCUTTA Special Jurisdiction [Income Tax] ORIGINAL SIDE ITA/28/2023
PRINCIPAL COMMISSIONER OF INCOME TAX-5, KOLKATA VS. M/S. ACCLARIS BUSINESS SOLUTIONS P LTD.
BEFORE : THE HON’BLE THE CHIEF JUSTICE T.S. SIVAGNANAM AND THE HON’BLE JUSTICE CHAITALI CHATTERJEE (DAS) Dated : 31ST July, 2025
Appearance : Mr. Prithu Dudhoria, Adv. …for Appellant Mr. Pratyush Jhunjhunwala, Adv. Mr. Mrigank Kejriwal, Adv. Ms. Sruti Dutta, Adv. Ms. Sakshi Singhi, Adv. ..for the appellant.
The Court : We have heard Mr. Prithu Dudhoria, learned Standing Counsel appearing for the appellant/revenue and Mr. Pratyush Jhunjhunwala, learned Advocate appearing for the assessee/respondent. This appeal filed by the Department under Section 260A of the Income Tax Act, 1961 is directed against the order dated October 20, 2020 passed by the Income Tax Appellate Tribunal, “C” - Bench, Kolkata in ITA No.1458/Kol/2017 for the assessment year 2010-11.
As the tax effect involved in this appeal is less than the threshold limit mentioned in the Circular issued by CBDT, the revenue cannot pursue this appeal any further. Accordingly, the appeal stands disposed of on the ground of low tax effect and the substantial questions of law are left open.
(T.S. SIVAGNANAM, CJ.)
(CHAITALI CHATTERJEE (DAS), J.)
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