COMMISSIONER OF INCOME TAX vs. THE ALL INDIA SKIN & HIDE

T.C.A.No.62 of 2016 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 22.04.2021 CORAM THE HON'BLE MR.JUSTICE M. DURAISWAMY AND THE HON'BLE MR.JUSTICE KRISHNAN RAMASAMY T.C.A.No.62 of 2016 Commissioner of Income Tax, Chennai. ... Appellant Vs. The All India Skin & hide Tanners and Merchant Association, No.43 (old 53) Raja Muthiah Road, Periamet, Chennai – 600 003. ... Respondent Appeal preferred under Section 260A of the Income Tax Act, 1961, against the order of the Income Tax Appellate Tribunal, Madras, “A” Bench, dated 06.06.2014 in I.TA.No.1751/Mds/2013, Assessment Year 2009-10. For Appellant : Mr.J.Narayanaswamy Senior Standing Counsel For Respondent : Mr.G.Baskar Page 1/6 https://www.mhc.tn.gov.in/judis/ T.C.A.No.62 of 2016 JUDGMENT (Judgment was delivered by M.DURAISWAMY, J.) We have heard Mr.J.Naryanaswamy learned Senior Standing Counsel for the appellant/Revenue and Mr.G.Baskar, learned counsel for the respondent/assessee. 2.The appeal, filed by the Revenue under Section 260A of the Income Tax Act, 1961 (for short, the Act) is directed against the order dated 06.06.2014 made in I.TA.No.1751/Mds/2013 on the file of the Income Tax Appellate Tribunal, Chennai, “A” Bench (for brevity, the Tribunal) for the Assessment Year 2009-10. 3.The appeal was admitted on 15.02.2016 on the following substantial questions of law: “1.Whether on the facts and circumstances of the case, the Tribunal was right in law in holding that the society is eligible for exemption under Section 11 of the Income Tax Act, in complete Page 2/6 https://www.mhc.tn.gov.in/judis/ T.C.A.No.62 of 2016 disregard to the facts of the case and provisions of newly inserted provisos to Section 2(15) of the Income Tax Act? 2.Whether on the facts and circumstances of the case, the Tribunal was right in law in holding that the activities of the assessee society are governed under 'principles of mutuality' even though the society is registered under Section 12AA of the Income Tax Act as a 'charitable entity' and has been claiming that status all along, more so when Kerala High Court in the case of M/s.Investors Club, Trichur vs. CIT [318 ITR 427 (Ker.)] has clearly held that a 'charitable institution' cannot raise the 'plea of mutuality'? 3.Whether on the facts and in the circumstances of the case and in law, the order of the Tribunal was not against the principle of 'judicial consistency' in as much as it was passed in disregard of the findings of its earlier order in ITA Nos.2749, 2750 and 2751/Mds/1994 for assessment years 1998-99, 1990-91 and 1991-92 where a clear finding had been given that the assessee's activities Page 3/6 https://www.mhc.tn.gov.in/judis/ T.C.A.No.62 of 2016 are in the nature of 'advancement of objects of general public utility' and such decision had already reached finality? And 4.Whether on the facts and in the circumstances of the case, the Tribunal was right in law in holding that reference made by the Assessing Officer to the D.I.T.(E) has statutory powers to cancel the registration under Section 12AA(3), if he is satisfied that the activities of the society are not genuine or are not being carried out in accordance with the objects, more so when such an order is yet to be passed?” 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 08.08.2019 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 this case is less than the threshold limit. Page 4/6 https://www.mhc.tn.gov.in/judis/ T.C.A.No.62 of 2016 5.In the light of the said submissions, the above Tax Case Appeal is 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 this case 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.D., J.] [K.R., J.] 22.04.2021

Index : Yes/No Internet : Yes

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To 1.The Income Tax Appellate Tribunal, Chennai, “A” Bench 2.The Commissioner of Income Tax, Chennai. Page 5/6 https://www.mhc.tn.gov.in/judis/ T.C.A.No.62 of 2016

M. DURAISWAMY, J. and KRISHNAN RAMASAMY, J. mkn T.C.A.No.62 of 2016 22.04.2021 Page 6/6 https://www.mhc.tn.gov.in/judis/