THE COMMISSIONER OF INCOME TAX vs. M/S G T INDUSTRIAL ENTERPRISES

ITA/634/2008HC KarnatakaKAHC01033067200802 August 2014Bench: B.MANOHAR,N.KUMAR3 pages

AI SummaryDismissed

What did the High Court hold?

The High Court held that the appeals were not maintainable. This decision was based on the Court's interpretation of Instruction No. 3/2011, which was held to be retrospective in nature in its earlier judgment in CIT Vs. RANKA & RANKA. Consequently, appeals where the net tax effect was less than Rs. 10 Lakhs were deemed not maintainable. The Court dismissed the appeals on this ground. However, the Revenue was granted liberty to revive these appeals if they succeeded in their appeal before the Supreme Court against the decision in CIT Vs. RANKA & RANKA.

What were the facts?

The appeals were filed by the Revenue (Commissioner of Income Tax and Income Tax Officer) against the common respondent, M/s. G.T. Industrial Enterprises. The appeals challenged orders passed by the Income Tax Appellate Tribunal (ITAT) for various assessment years: 1997-98, 1998-99, 1999-00, 2000-01, 2001-02, and 2002-03. The High Court noted that the net tax effect in these appeals was less than Rs. 10 Lakhs. The Court referred to its previous decision in CIT Vs. RANKA & RANKA, which held that Instruction No. 3/2011 was retrospective and that appeals with a net tax effect below Rs. 10 Lakhs were not maintainable.

What were the issues?

1. Whether the appeals filed by the Revenue are maintainable given that the net tax effect is less than Rs. 10 Lakhs, in light of Instruction No. 3/2011 and the High Court's decision in CIT Vs. RANKA & RANKA? Assessee's Contention: The judgment does not record any specific contentions made by the assessee. The decision appears to be based on the High Court's interpretation of its own precedent and a departmental instruction. Revenue's Contention: The Revenue argued that their appeals should be heard on merits. However, the High Court's decision hinges on the maintainability of the appeals due to the tax effect. The Revenue also indicated that they have filed an appeal before the Supreme Court against the High Court's decision in CIT Vs. RANKA & RANKA and reserved the liberty to revive these appeals if they succeed.

Which sections of the Income-tax Act were involved?

Section 260A

AI-generated summary — verify with the full judgment below

1 IN THE HIGH COURT OF KARNATAKA, BANGALORE

DATED THIS THE 2nd DAY OF AUGUST 2014

PRESENT

THE HON’BLE MR. JUSTICE N.KUMAR

AND

THE HON’BLE MR.JUSTICE B.MANOHAR

INCOME TAX APPEAL NO.616 OF 2008 C/W INCOME TAX APPEAL NOS.619 OF 2008, 623 OF 2008, 626 OF 2008, 627 OF 2008, 631 OF 2008, 634 OF 2008, 629 OF 2008 AND 643 OF 2008

BETWEEN :

THE COMMISSIONER OF INCOME TAX

C.R.BUILDING, QUEENS ROAD

BANGALORE

THE INCOME TAX OFFICER

WARD – 10(2), C.R.BUILDING

QUEENS ROAD, BANGALORE

... APPELLANTS

(COMMON)

(BY SRI.E.I.SANMATHI, ADV.)

AND :

M/s. G.T.INDUSTRIAL ENTERPRISES NO.10/15, SUNKADAKATTE VISWANEEDAM POST BANGALORE – 560 096

... RESPONDENT

(COMMON)

(BY SRI.D.N.MANJUNATH, ADV.) ---

2 These appeals are filed under Section 260A of I.T.Act, 1961 arising out of order dated 12.12.2007 passed in ITA Nos.423/BNG/2007, 424/BNG/2007, 433/BNG/2007, 425/BNG/2007, 426/BNG/2007, 428/BNG/2007, 433/BNG/2007, 427/BNG/2007 and 435/BNG/2007, respectively for the assessment years 1997-98, 1998-99, 2000-01, 1999-00, 2000-01, 2002-03, 2000-01, 2001-02 and 2002-03, respectively praying to formulate the substantial questions of law stated therein, allow the appeals and set aside the order dated 12.12.2007 passed by the ITAT, Bangalore in ITA No.423/BNG/2007, 424/BNG/2007, 433/BNG/2007, 425/BNG/2007, 426/BNG/2007, 428/BNG/2007, 433/BNG/2007, 427/BNG/2007 and 435/BNG/2007, respectively confirm the orders of the Appellate Commissioner and Income Tax Officer, Ward-10(2), Bangalore.

These appeals coming on for Hearing this day, N.KUMAR J., delivered the following:

JUDGMENT

All these appeals are preferred by the revenue challenging the order passed by the Tribunal, where the assessee is common.

The net tax effect in these appeals is less than Rs.10 Lakhs. This Court while interpreting Instruction No.3/2011 in I.T.A. No.3191/2005 disposed of on 02.11.2011 (CIT Vs. RANKA & RANKA), held that it is retrospective in nature and therefore, the appeals filed

3 where the net tax effect is less than Rs.10 Lakhs are covered under the Notification and as such, it is not maintainable. Accordingly, these appeals are also not maintainable.

It is submitted that against the said order of this Court in the case referred supra (I.T.A. No.3191/2005), the Revenue has preferred an appeal before the Supreme Court and it is still pending. In the event of the Revenue succeeding in the Apex Court, they are reserved the liberty to revive these appeals. With the said observation, the appeals are dismissed.

Sd/- JUDGE

Sd/- JUDGE RV

Recent GST High Court judgments

Search GST case law →