THE COMMISSIONER OF INCOME vs. VA.V.GOPALAKRISHNAN

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TCA/782/2018HC Madras02 March 2020Bench: Hon`ble Mr Justice M. SATHYANARAYANAN5 pages
AI SummaryDismissed

What did the High Court hold?

The High Court noted the submission by the Revenue's counsel regarding a circular issued under Section 268A of the IT Act, which dictates not to pursue appeals with a tax impact below one crore. As the tax assessed in this case was less than one crore, the High Court found that the Tax Case Appeal deserved dismissal. The appeal was accordingly dismissed. However, the substantial question of law framed by the Court was expressly left open to be decided in appropriate proceedings. No finding was given on the merits of the Section 54F deduction claim.

What were the facts?

The Revenue is the appellant against an order of the Income Tax Appellate Tribunal (ITAT), Chennai, dated 08.02.2018. The assessee, Shri A.V. Gopalakrishnan, for Assessment Year 2007-08, was initially assessed a tax of Rs.86,83,173/- by the Assessing Officer on 31.03.2015, with penalty proceedings also initiated. The assessee's appeal to the CIT(Appeals)-4, Chennai, was dismissed on 30.08.2016. The ITAT subsequently allowed the assessee's appeal. The Revenue has filed this appeal under Section 260A of the Income Tax Act, 1961. The amount in dispute is Rs.86,83,173/-.

What were the issues?

1. Whether the Tribunal was right in holding that deduction claimed under Section 54F is to be granted for all nine flats, even though the statutory condition of taking possession within three years from the date of transfer of the original assets was not fulfilled by the assessee? (Question of law turning on Section 54F of the IT Act). Contentions: Assessee: No appearance recorded. Revenue: The learned standing counsel for the Revenue submitted that in light of a circular issued by the Income Tax Department under Section 268A of the IT Act, a decision has been taken not to prosecute appeals with a tax impact of less than one crore. The tax assessed by the Income Tax Officer is admittedly less than one crore, and the Revenue prays for appropriate orders.

Which sections of the Income-tax Act were involved?

Section 260A,Section 54F,Section 250(6),Section 271(1)(C),Section 268A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, C Bench,

TCS No.782 of 2018 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 02.03.2020 CORAM : THE HON'BLE MR. JUSTICE M.SATHYANARAYANAN AND THE HONOURABLE MR. JUSTICE ABDUL QUDDHOSE Tax Case (Appeal) No.782 of 2018 The Commissioner of Income Tax Chennai.

...Appellant -vs- Shri A.V. Gopalakrishnan

...Respondent

Appeal filed under Section 260A of the Income Tax Act, 1961 against the order of the Income Tax Appellate Tribunal, "C" Bench, Chennai, dated 08.02.2018 in ITA No.3163/Chny/2016. For Petitioner : Mr. T. Ravi Kumar For Respondent : No appearance. __________ Page 1 of 5 http://www.judis.nic.in TCS No.782 of 2018 ORDER (Order of the Court was made by M.SATHYANARAYANAN, J.,) The Revenue is the appellant. 1. The Respondent/assessee, for the Assessment Year 2007-08, by an order of the Assessing Officer dated 31.03.2015, was imposed a tax of Rs.86,83,173/- and it was followed by a Penalty proceedings under Section 271(1)(C) of the Income Tax Act, 1961, [in short “IT Act”] being initiated separately. The Assessee, aggrieved by the said order of Assessment, filed an appeal before the Commissioner of Income Tax (Appeals)-4. The CIT(Appeals), Chennai, vide an order dated 30.08.2016 passed under Section 250(6) of the IT Act, dismissed the appeal. The Assessee made further challenge by filing an appeal before the Income Tax Appellate Tribunal, "C" Bench, Chennai. The ITAT, Chennai, vide impugned order dated 08.02.2018, had allowed the appeal and challenging the same, the Revenue has filed the present appeal. 2. __________ Page 2 of 5 http://www.judis.nic.in TCS No.782 of 2018 2. This Appeal was entertained on 11.06.2019 by framing the following substantial question of law: "Whether the Tribunal was right in holding that deduction claimed U/s. 54F is to be granted for all the Nine flats even though the condition prescribed by the statute has not been fulfilled by the Assessee since possession has been taken after 3 years from the date of transfer of the original assets?" 3. Mr. T. Ravi Kumar, the learned standing counsel appearing for the Revenue would submit that in the light of the circular issued by the Income Tax Department under Section 268A of the IT Act, a decision has been taken not to prosecute the appeal, which is having the tax impact of less than one crore and admittedly a circular in this regard has also been issued and in the light of the fact that the tax assessed by the income tax officer is less than one crore, prays for appropriate orders. __________ Page 3 of 5 http://www.judis.nic.in TCS No.782 of 2018 4. In the light of the said circular, this Tax Case Appeal deserves dismissal and accordingly dismissed. However, the question of law is left open and it is to be decided in an appropriate proceedings.

[MSNJ] [AQJ]

02.03.2020 Index : Yes/No bga Copy to The Income Tax Appellate Tribunal, "C" Bench, Chennai. __________ Page 4 of 5 http://www.judis.nic.in TCS No.782 of 2018 M.SATHYANARAYANAN, J., and ABDUL QUDDHOSE, J., bga Tax Case (Appeal) No.782 of 2018 02.03.2020 __________ Page 5 of 5 http://www.judis.nic.in

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