COMMISSIONER OF INCOME TAX vs. M/S NOVADYEING PRINTING MILLS

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TCA/93/2015HC Madras17 March 2020Bench: Hon`ble Dr Justice VINEET KOTHARI4 pages
AI SummaryDismissed

What did the High Court hold?

The High Court noted that the learned Standing Counsel for the Revenue brought to its notice Circular No. 17/2019 dated 8th August 2019 issued by the Central Board of Direct Taxes (CBDT). This circular stipulates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs. 1,00,00,000/- (Rupees One Crore). In the present cases, the tax effect was stated to be less than this monetary limit. Consequently, the High Court dismissed the appeals filed by the Revenue as not pressed. The substantial questions of law were expressly left open for determination in an appropriate case.

What were the facts?

The Revenue, represented by the Commissioner of Income Tax, filed two Tax Case Appeals (TCA Nos. 93 & 94 of 2015) before the High Court of Judicature at Madras. These appeals challenged a common order passed by the Income Tax Appellate Tribunal (ITAT), 'B' Bench, Chennai, dated 13.01.2011, concerning ITA Nos. 696 & 484/Mds/2010. The appeals were filed under Section 260A of the Income Tax Act, 1961. The respondent in these appeals is M/s. Nova Dyeing Printing Mills Ltd. The core of the dispute involved the disallowance of an expenditure of Rs. 15,77,851/- by the Revenue.

What were the issues?

1. Whether, on the facts and circumstances of the case, the Tribunal was right in holding that the disallowance of Rs. 15,77,851/- being the expenditure incurred for keeping its jurisdictional personality was to be allowed? (Question of law) The Revenue's contention was that the Tribunal erred in allowing the disallowance. The judgment does not record specific arguments from the Revenue regarding the merits of the disallowance. However, the Revenue's appeal was based on the substantial question of law as framed above. The Respondent (assessee) did not present any arguments before the High Court as the appeals were dismissed as not pressed by the Revenue.

Which sections of the Income-tax Act were involved?

Section 260A

AI-generated summary — verify with the full judgment below

Order in TCA Nos.93 & 94 of 2015 (CIT -Vs- M/s.Nova Dyeing Printing Mills) dated 17.03.2020 IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 17.03.2020 CORAM THE HON'BLE DR.JUSTICE VINEET KOTHARI AND THE HON'BLE MR.JUSTICE R.SURESH KUMAR Tax Case (Appeal) Nos.93 & 94 of 2015 The Commissioner of Income Chennai.

... Appellant in both appeals Vs. M/s.Nova Dyeing Printing Mills Ltd 41, KKR Avenue, Perambur Chennai. .. Respondent in both appeals Tax Case Appeals filed under Section 260A of the Income Tax Act, 1961 against the common order of the Income Tax Appellate Tribunal 'B' Bench, Chennai dated 13.01.2011 in ITA Nos.696 & 484/Mds/2010. For Appellant : Mr.V.Rajesh Junior Standing Counsel

For Respondent : Mr.R.Sivaraman

J U D G M E N T (Judgment of the Court was delivered by DR.VINEET KOTHARI,J) These Tax Case Appeals have been filed by the Revenue calling in question the correctness of the order passed by the Income Tax Appellate Tribunal, 'B' Bench, Chennai, by raising the following substantial question of law: Page 1 of 4 http://www.judis.nic.in Order in TCA Nos.93 & 94 of 2015 (CIT -Vs- M/s.Nova Dyeing Printing Mills) dated 17.03.2020 “ Whether on the facts and circumstances of the case, the Tribunal was right in holding that the disallowance of Rs.15,77,851/- being the expenditure incurred for keeping its jurisdictional personality was to be allowed?”

2.

When the matter was taken up for hearing, the learned Standing Counsel brought to our notice the Circular instruction issued by the Central Board of Direct Taxes vide Circular No.17/2019 dated 8th August 2019, wherein, it is stipulated that appeals shall not be filed/pursued by the Department before the High Court in cases where the tax effect does not exceed Rs.1,00,00,000/- (Rupees One Crore). 3. In the instant cases, the tax effect is said to be less than the monetary limit imposed and therefore, the appeals filed by the Revenue are dismissed as not pressed, keeping open the substantial questions of law for determination in an appropriate case. (V.K.,J.) (R.S.K.,J.) 17.03.2020 KST Page 2 of 4 http://www.judis.nic.in Order in TCA Nos.93 & 94 of 2015 (CIT -Vs- M/s.Nova Dyeing Printing Mills) dated 17.03.2020 To Income Tax Appellate Tribunal 'B' Bench,Chennai. Page 3 of 4 http://www.judis.nic.in Order in TCA Nos.93 & 94 of 2015 (CIT -Vs- M/s.Nova Dyeing Printing Mills) dated 17.03.2020 DR.VINEET KOTHARI, J. AND R.SURESH KUMAR, J. KST T.C.(A) Nos.93 & 94 of 2015 17.03.2020 Page 4 of 4 http://www.judis.nic.in

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