PRINCIPAL COMMISSIONER OF vs. SAGGEZZA INDIA P LTD

TCA.No.570 of 2018 In the High Court of Judicature at Madras Dated : 28.08.2019 Coram : The Honourable Mr.Justice T.S.SIVAGNANAM and The Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal No.570 of 2018 Principal Commissioner of Income Tax 6, No.121, Nungambakkam High Road, Chennai - 600 034. ...Appellant Vs M/s.Saggezza India P. Ltd., 9E, 9th Floor, IIR Madras, Research Park, Kanagam Road, Taramani, Chennai - 600 013. PAN: AAJCS2643H ...Respondent APPEAL under Section 260A of the Income Tax Act, 1961 against the order dated 22.03.2017 made in ITA.No.3323/MDS/2016 on the file of the Income Tax Appellate Tribunal, Chennai 'D' Bench for the assessment year 2012-13. For Appellant : Mr.T.R.Senthilkumar, SSC assisted by Ms.K.G.Usharani For Respondent : Mr.N.P.Vijayakumar and Mr.R.Pradeep JUDGMENT (Judgment was delivered by T.S.Sivagnanam,J.) We have heard Mr.T.R.Senthilkumar, learned Senior Standing Counsel, assisted by Ms.K.G.Usharani, learned counsel appearing for the appellant/revenue and Mr.N.P.Vijayakumar and Mr.R.Pradeep, learned counsel appearing for the respondent/assessee. 1/4 http://www.judis.nic.in TCA.No.570 of 2018 2.This appeal, filed by the Revenue under Section 260A of the Income Tax Act, 1961 is directed against the order dated 22.03.2017 made in ITA.No.3323/MDS/2016 on the file of the Income Tax Appellate Tribunal, Chennai 'D' Bench for the assessment year 2012-13. 3.The appeal has been filed by raising the following substantial questions of law : “i. Whether the Tribunal is correct and justified in deleting the addition towards arms length price made by the Transfer Pricing Officer on transaction with Associated Enterprises ? ii. Whether the Tribunal ought to have held that expenses incurred by the assessee towards employee cost and consultancy charges were for providing services to its Associated Enterprises and hence, any extra expenditure incurred towards creating additional capabilities ought to have been compensated by Associated Enterprises ? And iii. Whether the Tribunal is correct in law in holding that employees and consultancy charges, which are not relating to the projects executed and billed during the year under consideration cannot be considered as operating expenses is unreasonable when no such adjustment was made in the case of comparables considered in the transfer pricing study ?” 4.The learned Senior Standing Counsel for the appellant submits that the above appeal is not pursued by the Revenue on account of the low tax effect in terms of Circular No.17/2019 dated 08.8.2019 issued by the Central 2/4 http://www.judis.nic.in TCA.No.570 of 2018 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. 5.In the light of the said submissions, the above tax case appeal is dismissed on account of the low tax effect. The substantial questions of law framed 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. (T.S.S.J.) (V.B.S.J.) 28.08.2019 cse Speaking (or) Non Speaking Order Index : Yes (or) No To 1.M/s.Saggezza India P. Ltd., 9E, 9th Floor, IIR Madras, Research Park, Kanagam Road, Taramani, Chennai - 600 013. 2.The Income Tax Appellate Tribunal, Chennai 'D' Bench. 3/4 http://www.judis.nic.in TCA.No.570 of 2018 T.S.SIVAGNANAM,J. AND V.BHAVANI SUBBAROYAN,J. cse TCA.No.570 of 2018 28.08.2019 4/4 http://www.judis.nic.in