PRINCIPAL COMMISSIONER OF vs. M/S. SOUTHERN AGRIFURANE

PDF · subscribers
TCA/683/2017HC Madras21 July 2020Bench: Hon`ble Mr Justice KRISHNAN RAMASAMY4 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that no substantial question of law arises from the ITAT's order, which remanded the case back to the Assessing Authority for verification of TDS on trademark usage fees and the applicability of Section 40(a)(ia). The Court reasoned that the issue concerning Section 40(a)(ia) was still pending before the Assessing Authority. It was only after a final decision by the Assessing Authority, and if either party was aggrieved, that a question of law could potentially arise. Since no such order was brought to the Court's notice, and the ITAT's order was merely a remand, the appeal under Section 260A was disposed of without answering the questions of law raised. The operative direction was to dispose of the appeal.

What were the facts?

The appeal is filed by the Principal Commissioner of Income Tax (Revenue) against an order of the Income Tax Appellate Tribunal (ITAT) dated January 11, 2017. The ITAT, for Assessment Year 2008-09, had remanded the case back to the Assessing Authority. The remand was for verification of tax deducted at source (TDS) on an amount paid by the assessee, M/s. Southern Agrifurane Industries (P) Limited, for an alleged contract of tie-up of manufacture. The specific issue involved trademark usage fees and related TDS. The ITAT had relied on the Kolkata High Court decision in CIT v. S.K.Telcriwal.

What were the issues?

1. Whether a substantial question of law arises from the ITAT's order remanding the case back to the Assessing Authority for verification of TDS on trademark usage fees, particularly concerning the applicability of Section 40(a)(ia) of the Income Tax Act. Assessee's Contention: The assessee did not present arguments as the High Court found no substantial question of law arising from the ITAT's remand order. Revenue's Contention: The Revenue argued that a substantial question of law arises from the ITAT's order. However, the High Court noted that the issue regarding the applicability of Section 40(a)(ia) was remanded and had not yet been decided by the Assessing Authority. The Revenue did not provide information about any subsequent order passed by the Assessing Authority after the remand.

Which sections of the Income-tax Act were involved?

Section 260A,Section 40(a)(ia)

AI-generated summary — verify with the full judgment below

Judt. Dated.21.07.2020 in T.C.A.No.683 of 2017 1/4 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 21.07.2020 CORAM THE HON'BLE DR.JUSTICE VINEET KOTHARI AND THE HON'BLE MR.JUSTICE KRISHNAN RAMASAMY TCA No.683 of 2017 Principal Commissioner of Income Tax 6 No.121, Mahatma Gandhi Road, Chennai 600 034. .. Appellant Vs. M/s. Southern Agrifurane Industries (P) Limited, M.G.M Centre, No.1, 9th Street, Dr. Radhakrishnan Salai, Mylapore, Chennai - 600 004. PAN: AAG CS 9705 F .. Respondent ----- Appeal under Section 260A of the Income Tax Act, against the order of the Income Tax Appellate Tribunal Madras 'C' Bench dated 11th January 2017 in ITA No.1577/Mds/2016. ----- For Appellant : Mr.J.Narayanasamy, Sr.S.C. For Respondent : Mr.S.Sridhar ----- http://www.judis.nic.in Judt. Dated.21.07.2020 in T.C.A.No.683 of 2017 2/4 JUDGMENT (Delivered 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 residences and the counsel, staff of the Court appearing from their respective residences. 2. Heard the learned counsel for the appellant Revenue Mr.J.Narayanasamy and the learned counsel for the respondent Assessee, Mr.Sridhar. 3. By the impugned order dated 11.01.2017, the Tribunal, for the Assessment Year 2008-09, has only remanded the case back to the Assessing Authority for verification of the tax deducted at source on the amount paid by the Assessee for the alleged contract of tie up of manufacture. The amount of trade mark usage fees and TDS in relation thereto is yet to be determined. The Tribunal had merely referred and relied upon the decision of the Kolkota High Court in CIT v. S.K.Telcriwal [361 ITR 432], in para 6 of its order. Since the issue with regard to the applicability of Section 40(a)(ia) of the Act has been http://www.judis.nic.in Judt. Dated.21.07.2020 in T.C.A.No.683 of 2017 3/4 remanded back to the Assessing Authority, we do not find any substantial question of law to be arising in the present appeal filed by the appellant Revenue. It is only when the issue regarding the applicability of Section 40(a)(ia) is decided by the authorities again upon such remand, and if either of the parties can be said to be aggrieved, then only, question of law if at all can be said to be arising from the order of the Tribunal. It is not brought to our notice that any such order of Assessing Authority has been passed after such remand or not. Therefore, in our opinion, from the present order of the ITAT by which a remand has been made to the Assessing Authoirty, on the issue involved in the present case, we do not find any substantial question of law arising within the meaning of Section 260A of the Act. 4. The appeal is accordingly disposed of without answering the questions of law raised in the said appeal. No costs. (V.K.,J.) (K.R.,J.) 21.07.2020 kpl/tar http://www.judis.nic.in Judt. Dated.21.07.2020 in T.C.A.No.683 of 2017 4/4 DR.VINEET KOTHARI, J. and KRISHNAN RAMASAMY, J. (tar) TCA No.683 of 2017 21.07.2020 http://www.judis.nic.in

More judgments on Section 40(a)(ia)

All 7,300 judgments and leading authorities on Section 40(a)(ia) →

Recent GST High Court judgments

Search GST case law →