COMMISSIOONER OF INCOME TAX vs. SHRI KISHORE C.NANWANI,

T.C.A.No.212 of 2016 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED 23.08.2022 CORAM THE HON'BLE Mr. JUSTICE R. MAHADEVAN AND THE HON'BLE Mr. JUSTICE MOHAMMED SHAFFIQ Tax Case Appeal No.212 of 2016 The Commissioner of Income Tax Puducherry

.. Appellant Vs. Kishore C Nanwani No.44-46, J.N.Street Pondicherry 605 001 (AEKPN 5787 R) .. Respondent Tax Case Appeal filed under Section 260A of the Income Tax Act, 1961 against the order dated 17.04.2015 passed by the Income Tax Appellate Tribunal, 'C' Bench, Chennai, in I.T.A.No.1956/Mds/2014. For Appellant : Mr.J.Narayanaswamy Standing Counsel For Respondent : M/s.Babu Rangaswamy Associates J U D G M E N T (Judgment was delivered by R. MAHADEVAN, J.) This tax case appeal has been filed by the appellant/Revenue, calling in question the correctness of the order dated 17.04.2015 passed by the Income 1/4 https://www.mhc.tn.gov.in/judis T.C.A.No.212 of 2016 Tax Appellate Tribunal, 'C' Bench, Chennai, in I.T.A.No.1956/Mds/2014, relating to the assessment year 2009-10. 2. By order dated 14.03.2016, this Court admitted the aforesaid tax case appeal on the following substantial questions of law : “(i) Whether on the facts and in the circumstances of the case, the Tribunal was right in treating the unexplained credits in the bank deposits as the business turnover and applying the percentage of 8% on the bank deposits to arrive at undisclosed business income when the assessee himself had adopted the higher percentage of 14.31% and 20% gross profit in the return? (ii) Whether on the facts and in the circumstances of the case, the Tribunal was right in treating the business income based on the bank deposits as explained and consequently setting off the same against the cost of construction to treat the Investment on construction as explained? (iii) Whether on the facts and in the circumstances of the case, the Tribunal was right in accepting the sources of investment in the construction of the buliding, as sale proceeds of two properties and loan from Smt.Vimala Devi when the assessee had failed to prove the creditors before the Assessing Officer and had inclined to offer any explanation to the Assessing Officer at the time of remand proceedings with respect to the sale of properties, which was a new argument raised before the Commissioner of Income Tax (Appeals) for the first time and spreading the cost of construction to three years and setting off the excess/surplus cost against the other years and (iv) Whether on the facts and in the circumstances of the case, the Tribunal was right in not considering the issue of 2/4 https://www.mhc.tn.gov.in/judis T.C.A.No.212 of 2016 unexplained credits under Section 68 and not considering the aspects of genuineness of the credits, identity of creditors and credit worthiness of the creditors for the purpose of deciding the issue of unexplained credit under Section 68?” 3. When the matter was taken up for consideration, the learned Standing Counsel for the appellant/Revenue brought to the notice of this court the Circular No.17/2019 dated 08.08.2019, issued by the Central Board Direct Taxes, wherein, it is stipulated that appeal shall not be filed/pursued by the Department before the High Court in cases where the tax effect does not exceed Rs.1,00,00,000/- (Rupees One Crore). It is also submitted that the tax effect in this appeal is less than the threshold limit. 4. In the light of the aforesaid submissions made by the learned Standing Counsel for the appellant/Revenue, the present appeal, wherein, the tax effect is said to be less than the monetary limit imposed, is dismissed as withdrawn, keeping open the substantial questions of law for determination in an appropriate case. No costs. [R.M.D,J.] [M.S.Q, J.] 23.08.2022 Internet : Yes gya 3/4 https://www.mhc.tn.gov.in/judis T.C.A.No.212 of 2016 R. MAHADEVAN, J. AND MOHAMMED SHAFFIQ, J. gya To 1.The Income Tax Officer Ward-I(1) Pondicherry 2.The Commissioner of Income Tax (Appeals)-VI Chennai 3.The Income Tax Appellate Tribunal 'C' Bench, Chennai Tax Case Appeal No.212 of 2016 23.08.2022

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