PRINCIPAL COMMISSIONER OF vs. M/S.SHIRDI ESTATES,

T.C.A.Nos.631 to 634 of 2016 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 18.08.2022 CORAM : THE HONOURABLE MR. JUSTICE R. MAHADEVAN AND THE HONOURABLE MR. JUSTICE MOHAMMED SHAFFIQ T.C.A.Nos.631 to 634 of 2016 and CMP.Nos.13129 to 13131 of 2016 Principal Commissioner of Income Tax, No.108, Mahatma Gandhi Road, Chennai 600 034. ... Appellant in all TCAs Versus M/s. Shirdi Estates, New No.32, Old No.28, Ramachandra Road, Nehru Nagar, Chromepet, Chennai - 600 044. PAN: AAA HS 8731 E ... Respondent in TCA.Nos.631 & 632 of 2016 R.Vasanthi Ram Narayan

... Respondent in TCA.Nos.633 & 634 of 2016 Page 1/6 https://www.mhc.tn.gov.in/judis T.C.A.Nos.631 to 634 of 2016 Appeals preferred under Section 260A of the Income Tax Act, 1961, against the order dated 18.12.2015 passed by the Income Tax Appellate Tribunal, “B” Bench, Chennai, in I.T.A.Nos.1802, 1803, 1804 and 1805/Mds/2015. For Appellant : Mr.Karthik Ranganathan Senior Standing Counsel Mr.Rajesh in all TCAs For Respondents : Mr.N.V.Balaji in all TCAs

COMMON JUDGMENT (Judgment of the Court was delivered by R.MAHADEVAN, J.) These tax case appeals have been filed by the appellant / Revenue, challenging the common order dated 18.12.2015 passed by the Income Tax Appellate Tribunal, “B” Bench, Chennai, in I.T.A.Nos.1802, 1803, 1804 and 1805/Mds/2015, relating to the assessment years 2008-09 and 2009-10.

2.By order dated 02.11.2016, this court admitted the aforesaid tax case appeals on the following substantial questions of law: Page 2/6 https://www.mhc.tn.gov.in/judis T.C.A.Nos.631 to 634 of 2016 TCA.Nos.631 & 632 of 2016 “(i) Whether on the facts and circumstances of the case, the Appellate Tribunal is right in law in holding the income on sale of plots of land is to be assessed under the head 'capital gains' and not under the head 'business' income? and (ii) Whether in the facts and circumstances of the case, the Appellate Tribunal was right in ignoring the fact that the Appellant had purchased the property specifically for the purpose of commercial exploitation and as her intention was to plotting and selling them and therefore the entire transaction has to be construed as adventure in the nature of trade and therefore taxable as business income as held in the case of S.Ramaiaha reported in 42 ITR 179? TCA.Nos.633 & 634 of 2016 “(i) Whether on the facts and circumstances of the case, the Appellate Tribunal is right in law in holding the income on sale of plots of land is to be assessed under the head 'capital gains' and not under the head 'business' income? and (ii) Whether in the facts and circumstances of the case, the Appellate Tribunal was right in ignoring the fact that the appellant had purchased the property specifically for the purpose of commercial exploitation and as her intention was to plotting and selling them and therefore the entire transaction has to be construed as adventure in the nature of trade and therefore taxable as business income as held in the case of S.Ramaiaha reported in 42 ITR 179? Page 3/6 https://www.mhc.tn.gov.in/judis T.C.A.Nos.631 to 634 of 2016 (iii) Whether on the facts and circumstances of the case, the Appellate Tribunal is right in law in deleting the addition of Rs.1 lakh towards the agricultural income admitted by the assessee treating the same as income from 'other sources' without appreciating the fact that the Tahsildar had confirmed that no agricultural activity was carried out in the subject land during the past 10 years? (iv) Whether on the facts and circumstances of the case, the Appellate Tribunal is right in law in deleting the gain on sale of land at Ratnamangalam treating the land as 'agricultural land' when no agricultural activity was carried out in the said land and is situated at 6.5 kms. distance from the nearest Selaiyur Municipality? (v) Whether on the facts and circumstances of the case, the Appellate Tribunal is right in law in treating the land at Nathanallur as 'agricultural land' and hence, not liable for capital gains tax, when the land was not put to any agricultural activity in the last 10 years period and the investment was made only for exploitation for real estate purpose and not for carrying out any agricultural activity? 3. When the matters were taken up for consideration, the learned counsel for the appellant / Revenue brought to the notice of this court the Circular No.17/2019 dated 08.08.2019 issued by the Central Board Direct Taxes, wherein, it is stipulated that appeals shall not be filed/pursued by the Page 4/6 https://www.mhc.tn.gov.in/judis T.C.A.Nos.631 to 634 of 2016 Department before the High Court in cases where the tax effect does not exceed Rs.1,00,00,000/- (Rupees One Crore). It is also submitted that the tax effect in these appeals is less than the threshold limit. 4. In the light of the aforesaid submissions made by the learned counsel for the appellant / Revenue, the present appeals, wherein, the tax effect is said to be less than the monetary limit imposed, are dismissed as withdrawn, keeping open the substantial questions of law for determination in appropriate cases. No costs. Consequently, connected miscellaneous petitions are closed. (R.M.D., J.) (M.S.Q., J.) 18.08.2022

Internet : Yes

Index : Yes / No av To 1. The Income Tax Appellate Tribunal, “B” Bench, Chennai. 2. The Principal Commissioner of Income Tax, No.108, Mahatma Gandhi Road, Chennai 600 034. Page 5/6 https://www.mhc.tn.gov.in/judis T.C.A.Nos.631 to 634 of 2016 R. MAHADEVAN, J. and MOHAMMED SHAFFIQ, J. av