PRINCIPAL COMMISSIONER OF IN vs. M/S EQUITAS HOLDING PVT LTD.,

TCA.No.398 of 2020 In the High Court of Judicature at Madras Dated : 02.11.2020 Coram : The Honourable Mr.Justice M.M.SUNDRESH and The Honourable Mr.Justice D.KRISHNAKUMAR Tax Case Appeal No.398 of 2020 Principal Commissioner of Income Tax-2, Corporate Circle 2(1), Chennai-600 034. ...Appellant Vs. M/s Equitas Holding Pvt., Ltd., NO.672, 4th Floor, Temple Towers, Anna Salai, Nandanam, Chennai-600 035. PAN:AAACU 9126C ...Respondent APPEAL under Section 260A of the Income Tax Act, 1961 against the order dated 27.07.2017 made in ITA.No.2853/Mds/2016 on the file of the Income Tax Appellate Tribunal, Chennai 'C' Bench for the assessment year 2013-14. For Appellant: Mr.Karthik Ranganathan 1/4 http://www.judis.nic.in TCA.No.398 of 2020 JUDGMENT (Judgment was delivered by

M.M.Sundresh,J.

) This appeal is filed by the Revenue under Section 260A of the Income Tax Act, 1961 (for short, the Act) against the order dated 27.07.2017 made in ITA.No.2853/Mds/2016 on the file of the Income Tax Appellate Tribunal, Chennai 'C' Bench for the assessment year 2013-14 raising the following substantial questions of law: 1.Whether on the facts and circumstances of the case and in law, the ITAT was correct and justified in holding that investment made in subsidiary companies is not liable for disallowance u/s 14A when the provisions of the said section as well as Rule 8D does not provide for any such exception? 2.Whether on the facts and in the circumstances of the case and in law, the ITAT was correct in holding that when the assessee made investment in the subsidiary companies, the intention of the assessee is not for earning exempt income but because of commercial expediency? 3.Whether on the facts and in the circumstances of the case and in law, the ITAT was correct in not appreciating the CBDT circular No.5/2014 wherein it is clarified that, disallowance u/s 14A r.w.r.8D has to be made even if the taxpayer in a particular year not earned any exempt income? 2/4 http://www.judis.nic.in TCA.No.398 of 2020 2. The learned counsel appearing for the appellant submits that the above appeal may be dismissed on the ground of law tax effect in terms of Circular No.17/2019 dated 08.8.2019 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 this case is less than the threshold limit. 3. In the light of the said submission, the above tax case appeal is dismissed on account of the low tax effect. The substantial questions of law raised are left open. In the event the tax effect 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 appeal to be heard and decided on merits. No costs. (M.M.S.J.) (D.K.K.J.) 02.11.2020 Speaking (or) Non Speaking Order Index/Internet: Yes (or) No To The Income Tax Appellate Tribunal, Chennai 'C' Bench. Chennai. raa 3/4 http://www.judis.nic.in TCA.No.398 of 2020 M.M.SUNDRESH,J. AND D.KRISHNAKUMAR,J. raa TCA.No.398 of 2020 02.11.2020 4/4 http://www.judis.nic.in