PRINCIPAL COMMISSIONER vs. M/S.GMac FINANCIAL SERVICES

T.C.A.No.216 of 2017 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATE: 17.02.2021 CORAM: THE HON'BLE MR. JUSTICE M.DURAISWAMY AND THE HON'BLE MRS.JUSTICE T.V.THAMILSELVI T.C.A.No.216 of 2017 Principal Commissioner of Income Tax -2, No.121, Mahatma Gandhi Road, Chennai – 600 034. ... Appellant Vs. M/s.GMAC Financial Services India Ltd., Arihant 'E” Park II Floor, No.117/1, L.B.Road, Adyar, Chennai – 600 020. ... Respondent Appeal preferred under Section 260A of the Income Tax Act, 1961, against the order of the Income Tax Appellate Tribunal, Madras, "A" Bench, dated 09.09.2016 in I.TA.No.831/Mds/2016 Assessment Year 2007-08. For Appellant : Ms.Brinda and Mr.Karthick Ranganathan, Senior Standing Counsel For Respondent : Mr.Shreekumar for Mr.R.Sivaraman Page 1/5 https://www.mhc.tn.gov.in/judis/ T.C.A.No.216 of 2017 JUDGMENT (Judgment was delivered by M.DURAISWAMY, J.) We have heard Ms.Brinda, learned Standing Counsel for the appellant/Revenue and Mr.Shreekumar, learned counsel for the respondent/assessee. 2.The appeal, filed by the Revenue under Section 260A of the Income Tax Act, 1961 (for short, the Act) are directed against the order dated 09.09.2016 made in I.TA.No.831/Mds/2016 on the file of the Income Tax Appellate Tribunal, Chennai, "A" Bench (for brevity, the Tribunal) for the Assessment Year 2007-08. 3.The appeal was admitted on 10.04.2012 on the following substantial questions of law: “1)Whether in the facts and circumstances of the case, the Appellate Tribunal was right in holding that the guarantee commission cannot be treated as in the nature of interest? Page 2/5 https://www.mhc.tn.gov.in/judis/ T.C.A.No.216 of 2017 2)Whether on the facts and in the circumstances of the case and in law, the Appellate Tribunal was right in holding that guarantee fee cannot come under the purview of “interest” even though the definition of Section 2(28) of the Income Tax Act specifically includes any service fee or other charges?” 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 08.08.2019 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 these cases are 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 are left open. In the event the tax effect in this case is above the threshold limit fixed in the said Page 3/5 https://www.mhc.tn.gov.in/judis/ T.C.A.No.216 of 2017 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.] Index : Yes/No 17.02.2021 Internet : Yes (2/2) va

To The Income Tax Appellate Tribunal, Chennai, "A" Bench Page 4/5 https://www.mhc.tn.gov.in/judis/ T.C.A.No.216 of 2017 M.DURAISWAMY, J. and T.V.THAMILSELVI, J. va T.C.A.No.216 of 2017 (2/2) 17.02.2021 Page 5/5 https://www.mhc.tn.gov.in/judis/