PRINCIPAL COMMISSIONER OF IN vs. M/S. KAL PUBLICATIONS PVT LT

TCA.No.209 of 2021 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 16.3.2021 CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM and THE HONOURABLE MS.JUSTICE R.N.MANJULA Tax Case Appeal No.209 of 2021

The Principal Commissioner of Income Tax, Corporate Circle 4(2), Chennai-34 ...Appellant Vs M/s.Kal Publications Pvt.Ltd. Chennai-4. ...Respondent APPEAL under Section 260A of the Income Tax Act, 1961 against the order dated 24.10.2017 passed by the Income Tax Appellate Tribunal, Madras 'A' Bench, Chennai made in I.T.A.No.3350/Mds/2016 for the assessment year 2006-07. For Appellant: Mr.Karthik Ranganathan, SC For Respondent : Mr.N.Devanathan Judgment was delivered by

T.S.SIVAGNANAM

This appeal has been filed by the Revenue under Section 260A of the Income Tax Act, 1961 ('the Act' for brevity) challenging the 1/4 http://www.judis.nic.in TCA.No.209 of 2021 order dated 24.10.2017 made in I.T.A.No.3350/Mds/2016 on the file of the Income Tax Appellate Tribunal, Chennai 'A' Bench ('the Tribunal' for brevity) for the assessment year 2006-07. 2. The Revenue has filed this appeal by raising the following substantial questions of law : “i. Whether on the facts and circumstances of the case the ITAT was correct in considering accounting entries passed after the end of the previous year relevant AY. 2006-07 without taking cognizance of the well settled position of law that each Assessment Year is separate and distinct and accounting entries in subsequent years cannot influence the assessment of earlier year? ii. Whether on the facts and circumstances of the case, the ITAT was justified in holding that the alleged loan of Rs. 1.70 crores appearing in the books of M/s.Kal Cables Pvt Ltd in F.Y. 2005-06 was trade advances on the basis of transaction entries in the subsequent Financial Year? And iii. Whether on the facts and circumstances of the case, the order of ITAT was not perverse since the ITAT decided the issue solely on the basis in the subsequent 2/4 http://www.judis.nic.in TCA.No.209 of 2021 financial year totally ignoring the fact on record in the Financial Year relevant to AY 2006-07 which was under dispute?” 3. We have heard Mr.Karthik Ranganathan, learned Standing Counsel appearing for the appellant/Revenue and Mr.N.Devanathan, learned counsel accepting notice for the respondent/assessee. 4. The learned Senior Standing Counsel 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 08.8.2019 issued by the Central Board of Direct Taxes. By the said 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 on account of the low tax effect. The substantial questions of law raised are left open. In the event the tax effect is above the threshold limit fixed in the said circular, liberty is granted to the Revenue to file a petition before this Court to restore the appeal to be heard and decided on merits. No costs. 16.3.2021 RS 3/4 http://www.judis.nic.in TCA.No.209 of 2021 T.S.SIVAGNANAM,J AND R.N.MANJULA,J RS To The Income Tax Appellate Tribunal, 'A' Bench, Chennai. TCA.No.209 of 2021 16.3.2021 4/4 http://www.judis.nic.in