COMMISSIONER OF INCOME TAX vs. FAIRDEAL FILAMENTS LTD

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TAXAP/2432/2010HC GujaratGJHC24046407201014 October 2019Bench: HONOURABLE MS. JUSTICE HARSHA DEVANI,HONOURABLE MS. JUSTICE SANGEETA K. VISHEN2 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court held that the appeal should be disposed of as not pressed. The reasoning was based on the submission by the Revenue's learned senior standing counsel that the tax effect involved was less than Rs. 1,00,00,000/-. This fact, coupled with CBDT Circular No. 17 of 2019, which provides that appeals with a tax effect not exceeding Rs. 1,00,00,000/- shall not be filed before the High Court and has retrospective applicability, led the Revenue to not press the appeal. The ratio decidendi is that appeals below a certain monetary threshold, as stipulated by CBDT circulars, are to be withdrawn or not pressed by the revenue. The operative direction was to dispose of the appeal as not pressed. The judgment also noted that if there was any error in the computation of the tax effect or if the circular was not applicable for any reason, the appellant could seek revival of the appeal. No issue was expressly left undecided.

What were the facts?

This case concerns a Tax Appeal filed by the Commissioner of Income Tax (the Revenue) against Fairdeal Filaments Ltd (the assessee). The appeal was filed before the High Court of Gujarat at Ahmedabad. The assessment year(s) are not specified in the judgment. The order or action under challenge is the appeal itself, which the Revenue sought to withdraw. The amount in dispute, referred to as the tax effect, is stated to be less than Rs. 1,00,00,000/-. The procedural history is that the Revenue, through its learned senior standing counsel, stated that the tax effect was below the monetary limit prescribed by a CBDT Circular.

What were the issues?

1. Whether the appeal, with a tax effect below Rs. 1,00,00,000/-, should be pressed in light of CBDT Circular No. 17 of 2019. This is a question of procedural applicability and adherence to administrative directives. The Revenue's contention, as presented by its learned senior standing counsel, is that the tax effect in the present appeal is less than Rs. 1,00,00,000/-. Consequently, in light of CBDT Circular No. 17 of 2019, which mandates that appeals with a tax effect not exceeding Rs. 1,00,00,000/- should not be filed before the High Court and is retrospectively applicable to pending appeals, the Revenue does not press the present appeal. The assessee's contention is not recorded in the judgment.

AI-generated summary — verify with the full judgment below

C/TAXAP/2432/2010 ORDER IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/TAX APPEAL NO. 2432 of 2010 ========================================================== COMMISSIONER OF INCOME TAX Versus FAIRDEAL FILAMENTS LTD ========================================================== Appearance: MRS KALPANAK RAVAL(1046) for the Appellant(s) No. 1 MR MANISH J SHAH(1320) for the Opponent(s) No. 1 ========================================================== CORAM: HONOURABLE MS.JUSTICE HARSHA DEVANI and HONOURABLE MS. JUSTICE SANGEETA K. VISHEN

Date : 14/10/2019 ORAL ORDER (PER : HONOURABLE MS.JUSTICE HARSHA DEVANI) 1. Heard Mrs.Kalpana K. Raval, learned senior standing counsel for the appellant and Mr.Manish J. Shah, learned advocate for the respondent. 2. Mrs.Kalpana K. Raval, learned senior standing counsel for the appellant, has stated that the tax effect involved in this appeal is less than Rs.1,00,00,000/-. Under the circumstances, in the light of the Circular No.17 of 2019 dated 08.08.2019 issued by the Government of India, Ministry of Finance, Department of Revenue, Central Board of Direct Taxes, which provides that no appeal wherein the tax effect does not exceed the monetary limit of Rs.1,00,00,000/- shall be filed before the High Court and which has also been made retrospectively applicable to Page 1 of 2

C/TAXAP/2432/2010 ORDER pending appeals, the learned senior standing counsel for the appellant does not press the present appeal. 3. The appeal is, accordingly, disposed of as not pressed in light of the Circular dated 08.08.2019. However, in case there is any error in the computation of the tax effect involved or if, for any reason, the Circular is not applicable, it would be open for the appellant to seek revival of the appeal. (HARSHA DEVANI, J) (SANGEETA K. VISHEN,J) RAVI P. PATEL Page 2 of 2

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