PRINCIPAL COMMISSIONER OF vs. M/S.LOTTE INDIA CORPORATION

PDF · subscribers
TCA/416/2017HC Madras29 July 2020Bench: THE HON'BLE DR.JUSTICE VINEET KOTHARI4 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court dismissed the appeal filed by the Revenue. The dismissal was based on a Circular instruction issued by the Central Board of Direct Taxes (CBDT) vide Circular No. 17/2019 dated 8th August 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 found to be less than this monetary limit. Consequently, the appeal was dismissed as withdrawn, with the substantial questions of law left open for determination in appropriate cases. The connected miscellaneous petition was also dismissed. No costs were awarded.

What were the facts?

The Revenue, Principal Commissioner of Income Tax 4, filed a Tax Case Appeal against an order of the Income Tax Appellate Tribunal (ITAT), Madras A Bench, dated 28.09.2016. The appeal challenged the ITAT's decision regarding the set-off of unabsorbed depreciation. The assessee is M/s. Lotte India Corporation Ltd. The appeal concerns assessment years prior to 2001-02 and specifically mentions brought forward unabsorbed depreciation of Rs. 1,19,02,780/- pertaining to Assessment Years 1999-2000 and 2000-2001. The High Court was hearing the appeal on 29.07.2020.

What were the issues?

1. Whether, on the facts and circumstances of the case, the Appellate Tribunal was correct in law in holding that unabsorbed depreciation relating to assessment year 2001-02 and prior assessment years can be set off in subsequent years without any limit, as per the amended provision of Section 32(2) of the Income Tax Act? 2. Whether the Tribunal was correct in deleting the disallowance on the claim of setting off of brought forward unabsorbed depreciation amounting to Rs. 1,19,02,780/- pertaining to Assessment Years 1999-2000 and 2000-2001? Assessee's contentions: Not recorded in the judgment. Revenue's contentions: The Revenue is challenging the ITAT's decision on the allowability of setting off unabsorbed depreciation, particularly concerning the interpretation of Section 32(2) of the Income Tax Act and the deletion of disallowance for specific assessment years.

Which sections of the Income-tax Act were involved?

Section 32(2)

AI-generated summary — verify with the full judgment below

Order dt.29.07.2020 T.C.A.No.416/2017 1/4 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 29.07.2020 CORAM THE HON'BLE DR.JUSTICE VINEET KOTHARI AND THE HON'BLE MR.JUSTICE KRISHNAN RAMASAMY T.C.A.No.416/2017 and CMP No.10331/2017 Principal Commissioner of Income Tax 4 No.121, Mahatma Gandhi Road, Chennai - 600 034 ... Appellant vs. M/s. Lotte India Corporation Ltd, 4/169, Rajiv Gandhi Salai (OMR), Kandanchavadi Bus Stop, Perungudi Taluk, Chennai - 600 096. ... Respondent Prayer ::- Appeal filed against the order of the Income Tax Appellate Tribunal, Madras A Bench, dated 28.09.2016 in ITA No.525/Mds/2016. For appellant : Mr.Karthik Ranaganathan For respondent : Mr.Sandeep Bagmar ORDER (Made by DR.VINEET KOTHARI, J.) The Court was held by Video Conference, as per the Resolution of the Full Court dated 3 July 2020, by Judges at their respective residence and the counsel, staff of the Court appearing from their respective residences. http://www.judis.nic.in Order dt.29.07.2020 T.C.A.No.416/2017 2/4 2. 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 A Bench, dated 28.09.2016, by raising the following substantial questions of law: "1. Whether on the facts and circumstances of the case the Appellate Tribunal is correct in law in holding that Unabsorbed depreciation relating to the assessment year 2001-02 and assessment years prior thereto can be set off in subsequent years, without any limit, as per the amended provision of section 32[2] of the Income Tax Act? 2. Whether the Tribunal was correct in deleting the disallowance on the claim of setting off of brought forward unabsorbed depreciation amounting to Rs.l,19,02,780/- pertaining to Asst Years 1999-2000 and 2000-2001 ?” 3. When the matter is taken up for hearing, learned 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). http://www.judis.nic.in Order dt.29.07.2020 T.C.A.No.416/2017 3/4 4. 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 withdrawn, keeping open the substantial questions of law for determination in appropriate cases. No costs. Consequently, connected miscellaneous petition is also dismissed. (V.K.,J.) (K.R.,J.) 29.07.2020

kpl/tar To The Income Tax Appellate Tribunal, Madras A Bench http://www.judis.nic.in Order dt.29.07.2020 T.C.A.No.416/2017 4/4 DR.VINEET KOTHARI, J. and

KRISHNAN RAMASAMY, J. (tar) T.C.A.No.415 & 416/2017 29.07.2020 http://www.judis.nic.in

More judgments on Section 32(2)

All 321 judgments and leading authorities on Section 32(2) →

Latest GST High Court judgments

Search GST case law →