PRINCIPAL COMMISSIONER OF IN vs. M/S.KA INFRASTRUCTURE PVT LTD

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TCA/258/2021HC Madras23 August 2022Bench: Hon`ble Mr Justice R. MAHADEVAN4 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court considered the submission made by the learned counsel for the appellant/Revenue regarding CBDT Circular No. 17/2019. This circular mandates that appeals shall not be filed or pursued by the Department before the High Court in cases where the tax effect does not exceed Rs. 1,00,00,000/-. The Revenue stated that the tax effect in this particular appeal falls below this prescribed monetary limit. Consequently, in light of the circular and the submission regarding the tax effect, the High Court dismissed the present appeal as withdrawn. The substantial question of law was kept open for determination in an appropriate case. No costs were awarded.

What were the facts?

The Revenue, represented by the Principal Commissioner of Income Tax, Chennai, filed an appeal under Section 260A of the Income Tax Act, 1961, against an order dated 03.05.2017 passed by the Income Tax Appellate Tribunal (ITAT), Chennai. The ITAT's order pertained to the assessment year 2008-09 and concerned M/s. KA Infrastructure Pvt. Ltd. (now M/s. Khivraj Automobiles & Infrastructure Pvt. Ltd.). The appeal was admitted by the High Court on a substantial question of law regarding the deduction allowed under Section 80IA(4)(iv) of the Income Tax Act, 1961, when the assessee had taken windmills on lease. During the proceedings, the Revenue brought to the court's notice CBDT Circular No. 17/2019, which stipulates that appeals shall not be filed or pursued before the High Court if the tax effect does not exceed Rs. 1,00,00,000/-.

What were the issues?

1. Whether, on the facts and in the circumstances of the case and law, the ITAT was correct and justified in law in allowing deduction under Section 80IA(4)(iv) of the Income Tax Act, 1961, when the assessee has taken the windmills on lease? (Question of law) Assessee's Contention: Not recorded in the judgment. Revenue's Contention: The Revenue submitted that the tax effect in the present appeal is less than the threshold limit of Rs. 1,00,00,000/- stipulated in CBDT Circular No. 17/2019, and therefore, the appeal should not be pursued.

Which sections of the Income-tax Act were involved?

Section 80IA(4)(iv),Section 260A

AI-generated summary — verify with the full judgment below

T.C.A.No.258 of 2021 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 23.08.2022 CORAM : THE HONOURABLE MR. JUSTICE R. MAHADEVAN AND THE HONOURABLE MR. JUSTICE MOHAMMED SHAFFIQ T.C.A.No.258 of 2021 Principal Commissioner of Income Tax, Corporate Circle - 4(2), Chennai - 34. ... Appellant

Versus M/s. KA Infrastructure Pvt. Ltd., (Presently known as M/s. Khivraj Automobiles & Infrastructure Pvt. Ltd.,) Bharat Kumar Bhavan, Anna Salai, Chennai 600 006. PAN: AABCK 6189L ... Respondent Appeal preferred under Section 260A of the Income Tax Act, 1961, against the order dated 03.05.2017 passed by the Income Tax Appellate Tribunal, “B” Bench, Chennai, in I.T.A.No.1176/Mds/2015. For Appellant : Mr.Karthik Ranganathan Senior Standing Counsel For Respondent : Mr.N.V.Balaji Page 1/4 https://www.mhc.tn.gov.in/judis T.C.A.No.258 of 2021

JUDGMENT (Judgment of the Court was delivered by R.MAHADEVAN, J.) This tax case appeal has been filed by the appellant / Revenue, challenging the order dated 03.05.2017 passed by the Income Tax Appellate Tribunal, “B” Bench, Chennai, in I.T.A.No.1176/Mds/2015, relating to the assessment year 2008-09.

2.By order dated 17.04.2021, this court admitted the aforesaid tax case appeal on the following substantial question of law: “Whether on the facts and in the circumstances of the case and law the ITAT is correct and justified in law in allowing deduction under section 801A(4)(iv) of the Income Tax Act 1961 when the assessee has taken the windmills on lease?" 3.When the matter was taken up for consideration, the learned 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 Page 2/4 https://www.mhc.tn.gov.in/judis T.C.A.No.258 of 2021 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 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 question of law for determination in an appropriate case. No costs. (R.M.D., J.) (M.S.Q., J.) 23.08.2022

Internet : Yes

Index : Yes / No av To 1. The Income Tax Appellate Tribunal, “B” Bench, Chennai. 2. The Principal Commissioner of Income Tax, Corporate Circle - 4(2), Chennai - 34. 3. The Deputy Commissioner of Income Tax, Corporate Circle -(2), Chennai. 4. The Commissioner of Income Tax (Appeals), Chennai. Page 3/4 https://www.mhc.tn.gov.in/judis T.C.A.No.258 of 2021 R. MAHADEVAN, J. and MOHAMMED SHAFFIQ, J. av T.C.A.No.258 of 2021 23.08.2022 Page 4/4 https://www.mhc.tn.gov.in/judis

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