Tamil Nadu Maritime Board vs. The Commissioner of Income Tax (Exemptions), Chenn

TCA/129/2026HC Madras10 August 2026Bench: Honourable The CHIEF JUSTICE5 pages

AI SummaryDismissed

What did the High Court hold?

The High Court held that the ITAT's order was an "open remand" and the matter was to be re-decided after considering the Supreme Court judgment. Therefore, the High Court found no reason to interfere with the ITAT's order. The Court concluded that no substantial question of law arose for consideration in the tax case appeal. Consequently, the appeal was dismissed. The reasoning was that the ITAT's decision to remand for further consideration, in light of a relevant Supreme Court judgment, was appropriate and did not present a question of law for the High Court to adjudicate. The principle is that an appellate court will not interfere with a remand order by a lower appellate tribunal if it is based on sound reasoning and aims to ensure proper consideration of relevant legal precedents.

What were the facts?

The appellant, Tamil Nadu Maritime Board, filed a tax case appeal before the High Court of Judicature at Madras against an order passed by the Income Tax Appellate Tribunal (ITAT), Chennai. The ITAT had remanded the matter back to the Commissioner of Income Tax (Exemptions) for fresh consideration. The ITAT noted that the appellant's objects involved acting as an agent of the State for maintenance and regulation of minor ports, which it argued was for public benefit and coastal safety. The CIT(E) had previously rejected the appellant's application, stating it operated on commercial lines akin to business, without adverse findings on its overall nature and activities. The ITAT found that the CIT(E) had not considered the Supreme Court decision in ACIT(E) v. Ahmadabad Urban Development Authority.

What were the issues?

1. Whether the ITAT erred in remanding the matter to the Commissioner of Income Tax (Exemptions) for fresh consideration when it had made a finding in favour of the appellant? (Question of law) Assessee's contention: The appellant argued that once the ITAT had made a finding in its favour, it should not have remanded the matter for reconsideration. Revenue's contention: The respondent (Revenue) submitted that the remand was an "open remand" and did not require interference. They further argued that Supreme Court decisions covered the issue, making the remand proper and that no substantial question of law arose for consideration in the appeal, thus it should be dismissed.

Which sections of the Income-tax Act were involved?

Section 260A

AI-generated summary — verify with the full judgment below

T.C.A.No.129 of 2026 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 10.08.2026 CORAM : THE HONOURABLE MR. SUSHRUT ARVIND DHARMADHIKARI, CHIEF JUSTICE AND THE HONOURABLE MR.JUSTICE G.ARUL MURUGAN T.C.A.No.129 of 2026 Tamil Nadu Maritime Board No.171, South Kesava Perumal Puram, Off Greenways Road, Raja Annamalai Puram, Chennai-600 028 Appellant Vs The Commissioner of Income Tax (Exemptions), Chennai Aayakar Bhawan-Annexe Building, No.121, Mahatma Gandhi Road, Nungambakkam, Chennai-600 034. Respondent PRAYER

: Appeal filed under Section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal “A” Bench, Chennai, dated 08.04.2026 in ITA No.3563/Chny/2025. For Appellant: Mr.Suhrith Parthasarathy For Respondent: Mr.J.Narayanasamy Sr. Standing Counsel ______________ Page 1 of 5 https://www.mhc.tn.gov.in/judis ( Uploaded on: 11/08/2026 03:24:28 pm ) T.C.A.No.129 of 2026 JUDGMENT (Delivered by the Hon'ble Chief Justice) This tax case appeal under Section 260A of the Income Tax Act, 1961 has been filed challenging the order dated 08.04.2026 passed in ITA No.3563/Chny2025 by the Income Tax Appellate Tribunal (ITAT), “A” Bench, Chennai, remanding the matter to the Commissioner of Income Tax (Exemptions) for fresh consideration. 2. The ITAT, while remanding the matter to the CIT(E) for fresh consideration, came to the conclusion that on a perusal of the objects of the Trust, it came to the notice that the appellant is mainly acting as an agent of the State with regard to maintenance and regulation of minor ports which according to the appellant is ultimately for the benefit of the public since it protects the coastal safety. It was further noticed that the CIT(E) has rejected the application by stating that the appellant is operating on commercial line akin to business, without recording any adverse finding regarding the overall nature and activities of the appellant. Since the CIT(E) has not considered the ______________ Page 2 of 5 https://www.mhc.tn.gov.in/judis ( Uploaded on: 11/08/2026 03:24:28 pm ) T.C.A.No.129 of 2026 decision of the Supreme Court in the case of ACIT(E) v. Ahmadabad Urban Development Authority1, the ITAT remanded the matter to the CIT(E) for re-examination by taking into account the unique nature of the appellant’s activities and in the aforesaid decision of the Supreme Court. 3. It is the submission of learned counsel for the appellant that once the ITAT had given a finding in favour of the appellant, it ought not to have remanded the matter to CIT(E) for re-consideration. 4. On the other hand, learned Standing Counsel for the department submitted that it is open remand and no interference is required in the present tax case appeal. He further submitted that there are decisions of the Supreme Court, which cover the issue involved in the present appeal. Therefore, the remand is proper and there is no substantial question of law to be considered in this tax case appeal and the same deserves to be dismissed. 5. We have considered the submissions made by learned counsel for the parties and perused the materials available on record. 1[2022] 143 taxmann.com 278 (SC) ______________ Page 3 of 5 https://www.mhc.tn.gov.in/judis ( Uploaded on: 11/08/2026 03:24:28 pm ) T.C.A.No.129 of 2026 6. On a thorough reading of the impugned order, we find that the order of the ITAT is open remand and ultimately it has to be re-decided after taking into consideration the judgment of the Supreme Court on the point. Therefore, we see no reason to interfere with the order of the ITAT. No substantial question of law arises for consideration in this tax case appeal and, therefore, the same is liable to be dismissed. Accordingly, the tax case appeal is dismissed. There shall be no order as to costs. (SUSHRUT ARVIND DHARMADHIKARI, CJ) (G.ARUL MURUGAN,J)

10.08.2026 Index : Yes/No Neutral Citation : Yes/No bb To: 1. The Assistant Registrar Income Tax Appellate Tribunal Chennai Benches, Chennai. 2. The Commissioner of Income Tax (Exemptions), Chennai. ______________ Page 4 of 5 https://www.mhc.tn.gov.in/judis ( Uploaded on: 11/08/2026 03:24:28 pm ) T.C.A.No.129 of 2026 THE HON'BLE CHIEF JUSTICE AND G.ARUL MURUGAN,

bbr T.C.A.No.129 of 2026

10.08.2026 ______________ Page 5 of 5 https://www.mhc.tn.gov.in/judis ( Uploaded on: 11/08/2026 03:24:28 pm )

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