COMMISSIONER OF INCOME TAX vs. M/S HARI KRISHNA PAPERS PVT

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TCA/1221/2015HC Madras01 February 2021Bench: Hon`ble Mr Justice M.DURAISWAMY5 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court dismissed the appeal as withdrawn on account of low tax effect, as per the submissions made by the Revenue citing CBDT Circular No. 17/2019. The Court noted that the tax effect was below the threshold limit of Rs. 1 crore for pursuing appeals before the High Court. Consequently, the substantial questions of law framed for the appeal were left open. The Revenue was granted liberty to seek restoration of the appeal if the tax effect was later found to be above the threshold limit. No costs were imposed.

What were the facts?

The Revenue, represented by the Commissioner of Income Tax, filed an appeal under Section 260A of the Income Tax Act, 1961, against an order of the Income Tax Appellate Tribunal (ITAT), Chennai, dated July 24, 2015. This order pertained to Assessment Year 2009-10 and concerned M/s. Hari Krishna Papers Private Limited. The appeal was admitted on January 11, 2016, based on three substantial questions of law. The Revenue later submitted that it was not pursuing the appeal due to low tax effect, citing CBDT Circular No. 17/2019, which increased the monetary limit for High Court appeals to Rs. 1 crore. The tax effect in this case was stated to be below this threshold.

What were the issues?

The Tribunal was asked to decide three substantial questions of law: 1. Whether, on the facts and circumstances, the Tribunal was justified in law in holding that a new industrial undertaking had come into existence within the meaning of Section 80-1A(2) of the Income Tax Act. 2. Whether, on the facts and circumstances, the Tribunal was legally correct in holding that Section 80-1A(3)(i) was not applicable to the turbine unit. 3. Whether, on the facts and circumstances, the Tribunal was justified in law by overlooking the Commissioner of Tax Appeals' finding that the restrictive provisions under Section 80-1A(3)(ii) were also applicable. The Revenue argued that the appeal was not being pursued due to low tax effect, referencing CBDT Circular No. 17/2019. The judgment does not record specific arguments from the assessee on these issues.

Which sections of the Income-tax Act were involved?

Section 260A,Section 80-1A(2),Section 80-1A(3)(i),Section 80-1A(3)(ii)

AI-generated summary — verify with the full judgment below

T.C.A.No.1221 of 2015 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATE: 01.02.2021 CORAM: THE HON'BLE MR. JUSTICE M.DURAISWAMY AND THE HON'BLE MRS.JUSTICE T.V.THAMILSELVI T.C.A.No.1221 of 2015 Commissioner of Income Tax, No.63, Race Course Road, Chennai. ... Appellant v. M/s. Hari Krishna Papers Private Limited, NO.54/2, Jothi Nagar, Venkatesa Mills Post, Udumalpet - 642 128 PAN : AAD CS 0649 B ... Respondent Appeal preferred under Section 260A of the Income Tax Act, 1961, against the order of the Income Tax Appellate Tribunal, Madras, “B” Bench, dated 24.07.2015 in ITA.No.633/Mds/2014 for the Assessment Year 2009-10. Page 1/5 https://www.mhc.tn.gov.in/judis/ T.C.A.No.1221 of 2015 For Appellant : Mr. T.R. Senthil Kumar, Senior Standing Counsel For Respondent : Mr. Kaushik for M/s. S. Sridhar JUDGMENT (Judgment was delivered by M. DURAISWAMY, J.) We have heard Mr. T.R. Senthil Kumar, learned Senior Standing Counsel for the appellant/Revenue and Mr. Kaushik for the respondent/Assessee. 2. The appeal, filed by the Revenue under Section 260A of the Income Tax Act, 1961 (for short, the Act) is directed against the order dated 24.07.2015 made in ITA.No.633/Mds/2014 on the file of the Income Tax Appellate Tribunal, Chennai, ''B'' Bench (for brevity, the Tribunal) for the Assessment Year 2009-10. 3.The appeal was admitted on 11.01.2016 on the following Page 2/5 https://www.mhc.tn.gov.in/judis/ T.C.A.No.1221 of 2015 substantial questions of law: “(i) Whether, on the facts and circumstances of the case, the Tribunal is justified in law in holding that a new industrial undertaking has come into existence within the meaning of sub section (2) of Section 80 1A of the Income Tax Act? (ii) Whether, on the facts and circumstances of the case, the Tribunal is legally correct by holding that the provisions of section 80 1A(3) (i) is not applicable to the turbine unit? and (iii) Whether, on the facts and circumstances of the case, the Tribunal is justified in law by deciding the issue by over viewing the finding of the Commissioner of Tax Appeals that the restrictive provisions under section 80 1A(3) (ii) is also applicable ?” 4.The learned Senior Standing Counsel appearing for the appellant submits that the above appeal is not pursued by the Revenue on account of the Low Tax Effect in terms of Circular No.17/2019 dated 08.08.2019 issued by the Central Board of Direct Taxes. By the said Page 3/5 https://www.mhc.tn.gov.in/judis/ T.C.A.No.1221 of 2015 Circular, the monetary limit for filing or pursuing an appeal before the High Court has been increased to Rs.1 crore. It is further submitted that the tax effect in this case is less than the threshold limit. 5.In the light of the said submissions, the above Tax Case Appeal is dismissed as withdrawn on account of the Low Tax Effect. The substantial questions of law framed is left open. In the event the tax effect in this case is above the threshold limit fixed in the said Circular, liberty is granted to the Revenue to make a mention to this Court to restore the appeal to be heard and decided on merits. No costs. [M.D., J.] [T.V.T.S., J.] 01.02.2021

Index : Yes/No Internet : Yes Rj To The Income Tax Appellate Tribunal, Chennai, ''B'' Bench Page 4/5 https://www.mhc.tn.gov.in/judis/ T.C.A.No.1221 of 2015 M. DURAISWAMY, J. and T.V. THAMILSELVI, J. Rj T.C.A.No.1221 of 2015 01.02.2021 Page 5/5 https://www.mhc.tn.gov.in/judis/

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