PRINCIPAL COMMISSIONER OF IN vs. INTIMATE FASHIONS INDIA PVT.

T.C.A.Nos.278 and 279 of 2021 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 28.04.2021 CORAM THE HON'BLE MR. JUSTICE M.DURAISWAMY AND THE HON'BLE MRS.JUSTICE R. HEMALATHA T.C.A.Nos.278 and 279 of 2021 and C.M.P.No.7808 of 2021 Principal Commissioner of Income Tax, Company Circle -II (3), Room No.513, 5th Floor, New Block, 121, M.G. Road, Chennai- 600 034. ... Appellant in all appeals Vs. M/s.Intimate Fashions India Pvt. Ltd., Thiruporur Kottamedu High Road, Nadhivaram Village, Guduvanchery – 603 032. ... Respondent in all appeals Tax Case Appeals in T.C.A.Nos.278 and 279 of 2021 preferred under Section 260A of the Income Tax Act, 1961, against the order of the Income Tax Appellate Tribunal, Madras, “D” Bench, dated 10.04.2017 in I.T.A.Nos.1163/Mds/2014 and 1016/Mds/2014, respectively for the Assessment Year 2009-10. Page 1/6 http://www.judis.nic.in T.C.A.Nos.278 and 279 of 2021 For Appellant : Mr.Karthik Ranganathan Senior Standing Counsel in all appeals C O M M O N J U D G M E N T (Judgment was delivered by M.DURAISWAMY, J.) We have heard Mr.Karthik Ranganathan, learned Senior Standing Counsel for the appellant/Revenue. 2.The above appeals, filed by the Revenue under Section 260A of the Income Tax Act, 1961 (for short, the Act), are directed against the order dated 10.04.2017 made in I.T.A.Nos.1163/Mds/2014 and 1016/Mds/2014, on the file of the Income Tax Appellate Tribunal, Madras, “D” Bench (for brevity, the Tribunal) for the Assessment Year 2009-10. 3.The appellant/Revenue has raised the following substantial questions of law in the above appeals : “1.Whether in the facts and in the circumstances of Page 2/6 http://www.judis.nic.in T.C.A.Nos.278 and 279 of 2021 the case and in law, the Hon'ble ITAT was justified and correct in holding that travel expenses and internet charges incurred in foreign currency to be excluded from total turnover while computing the deduction u/s.10B when the section does not provide for exclusion? 2.Whether in the facts and in the circumstances of the case and in law, the Hon'ble ITAT was right in determining the Arm Length's Price by aggregating the different transactions of purchase of different raw materials from different Associate Enterprises and setting off negative variances in several transactions with positive variances in other transactions, instead of following transaction by transaction approach under Comparable Uncontrolled price (CUP) method as prescribed under Rule 10B(1)(a)(i) of the Income Tax Act Rule 1962? 3.Whether in the facts and in the circumstances of the case and in law, the Hon'ble ITAT was right in excluding the travel expenditure incurred in foreign currency from the total turnover when the clause (iii) to Explanation 2 to Section 10B specifically excludes the same only from the export turnover?” 4.The learned Senior Standing Counsel for the appellant submits Page 3/6 http://www.judis.nic.in T.C.A.Nos.278 and 279 of 2021 that the above appeals are 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 is less than the threshold limit. 5.In the light of the said submissions, the above Tax Case Appeals are 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 these cases is above the threshold limit fixed in the said Circular, liberty is granted to the Revenue to make a mention to this Court to restore the above appeals to be heard and decided on merits. No costs. Consequently, connected miscellaneous petition is closed. [M.D., J.] [R.H., J.] 28.04.2021

mkn Index : Yes/No Internet : Yes

Page 4/6 http://www.judis.nic.in T.C.A.Nos.278 and 279 of 2021 To 1.The Income Tax Appellate Tribunal, Madras, “D” Bench. 2.The Principal Commissioner of Income Tax, Company Circle -II (3), Room No.513, 5th Floor, New Block, 121, M.G. Road, Chennai- 600 034. Page 5/6 http://www.judis.nic.in T.C.A.Nos.278 and 279 of 2021 M.DURAISWAMY, J. and R. HEMALATHA, J. mkn T.C.A.Nos.278 and 279 of 2021 28.04.2021 Page 6/6 http://www.judis.nic.in