PRINCIPAL COMMISSIONER vs. SARAVANA ARUL

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TCA/288/2017HC Madras09 December 2019Bench: Hon`ble Mr Justice R. SURESH KUMAR5 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal filed by the Revenue. The primary reason for dismissal was the issuance of CBDT Circular No. 17/2019, dated August 8, 2019. This circular stipulates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs. 1,00,00,000/- (Rupees One Crore). In the present case, the tax effect was stated to be less than this monetary limit. Therefore, the Revenue's appeal was dismissed as not pressed, in light of the departmental policy. The Court explicitly stated that the substantial questions of law were kept open for determination in appropriate cases. No costs were awarded.

What were the facts?

The Revenue, represented by the Principal Commissioner of Income Tax, filed a Tax Case Appeal before the High Court of Judicature at Madras against an order of the Income Tax Appellate Tribunal (ITAT), Chennai 'B' Bench, dated July 5, 2016. The appeal pertained to Assessment Year 2012-2013 and concerned the treatment of excess jewellery found during a search. The assessee, Shri Saravana Arul, had claimed that some of the excess jewellery belonged to his mother and was declared under the Voluntary Disclosure Income Scheme (VDIS). The ITAT had considered this submission. The Revenue challenged the ITAT's decision to consider the assessee's submission made significantly after the search, which they argued contradicted the assessee's own statements during the search.

What were the issues?

1. Whether, on the facts and circumstances of the case and in law, the Appellate Tribunal was correct in considering the assessee's submission, made about 3 years after the search, that excess jewellery found included jewellery declared by his mother under the Voluntary Disclosure Income Scheme (VDIS), which was contrary to the assessee's own submission during the search proceedings? (Question of law and fact, concerning Section 260-A of the Income Tax Act, 1961). Assessee's Contention: Not recorded in the judgment. Revenue's Contention: The Tribunal erred in accepting the assessee's belated submission regarding jewellery declared under VDIS by his mother, especially when it contradicted his initial statements made during the search proceedings. 2. Whether, on the facts and in the circumstances of the case and in law, the Appellate Tribunal was correct in considering the jewellery declared by the mother of the assessee under the Voluntary Disclosure Income Scheme while computing the excess jewellery possessed by the assessee? (Question of law and fact, concerning Section 260-A of the Income Tax Act, 1961). Assessee's Contention: Not recorded in the judgment. Revenue's Contention: The Tribunal's consideration of the mother's VDIS declaration for computing the assessee's excess jewellery was legally flawed.

Which sections of the Income-tax Act were involved?

Section 260-A

AI-generated summary — verify with the full judgment below

Judgment dt. 09.12.2019 in T.C.A.No.288 of 2017 [M/s.Principal Commissioner Vs.Shri.Saravana Arul]

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 09.12.2019 CORAM: THE HON'BLE DR. JUSTICE VINEET KOTHARI and THE HON'BLE MR. JUSTICE R.SURESH KUMAR, J

T.C.(A).No.288 of 2017 Principal Commissioner of Income Tax I No.108 Mahatma Gandhi Road, Chennai-600 034.

... Appellant ..Vs.. Shri. Saravana Arul ... Respondent Prayer: Tax Cases (Appeal) are filed under Section 260-A of the Income Tax Act, 1961, against the order of the Income Tax Appellate Tribunal, Chennai 'B' Bench, dated 5.07.2016 passed in I.T.A.No.356/Mds/2016 for Assessment Year 2012-2013. For Appellant : Mr.T.R.Senthil Kumar

For Respondent : Mr.R.Sivaraman

http://www.judis.nic.in Judgment dt. 09.12.2019 in T.C.A.No.288 of 2017 [M/s.Principal Commissioner Vs.Shri.Saravana Arul]

J U D G M E N T

(Delivered by DR.VINEET KOTHARI, J.) This Tax Case Appeal has been filed by the Revenue calling in question the correctness of the order passed by the Income Tax Appellate Tribunal Madras 'B' Bench, Chennai, dated 05.07.2016, in I.T.A.No./356/Mds/2016 by raising the following substantial questions of law: "1. Whether on the facts and circumstances of the case and in law, the Appellate Tribunal is correct in considering the submission of the assessee, made about 3 years after search, the excess jewellery found in his case includes jewellery declared by his mother under Voluntary Disclosure Income Scheme (VDIS), which was against the own submission made by the assessee during the course of search proceedings?

2.

Whether on the facts and in the circumstances of the case and in law, the Appellate Tribunal is correct in considering the jewellery declared by the mother of the assessee under Voluntary Disclosure Income of Scheme, while computing the excess jewellery possessed by the assessee?" http://www.judis.nic.in Judgment dt. 09.12.2019 in T.C.A.No.288 of 2017 [M/s.Principal Commissioner Vs.Shri.Saravana Arul]

2.

When the matter is taken up for hearing, learned Standing Counsel for the Department brought to our notice the Circular instruction issued by the Central Board of Direct Taxes vide Circular No.17/2019, dated 8th August,2019, wherein, it is stipulated that appeals 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). 3. In the instant case, the tax effect is said to be less than the monetary limit imposed and, therefore, the Appeal filed by the Revenue is dismissed, as not pressed, keeping open the substantial questions of law for determination in appropriate cases. No costs. (V.K.,J.) (R.S.K.,J.) 09.12.2019 Index : Yes/No Internet : Yes/No arr

To Income Tax Appellate Tribunal, Chennai 'B' Bench Chennai. http://www.judis.nic.in Judgment dt. 09.12.2019 in T.C.A.No.288 of 2017 [M/s.Principal Commissioner Vs.Shri.Saravana Arul]

DR. JUSTICE VINEET KOTHARI,J and MR. JUSTICE SURESH KUMAR,J arr T.C.A.No.288 of 2017 09.12.2019 http://www.judis.nic.in Judgment dt. 09.12.2019 in T.C.A.No.288 of 2017 [M/s.Principal Commissioner Vs.Shri.Saravana Arul]

http://www.judis.nic.in

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