THE COMMISSIONER OF INCOME TAX vs. M/S SASTRY ELECTRONIC & ACCESSORIES

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ITA/914/2007HC KarnatakaKAHC01051823200710 February 2014Bench: B.MANOHAR,DILIP B.BHOSALE3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal as not maintainable. The primary reason for dismissal was that the tax effect in the instant appeal was less than Rs.10,00,000/-, which is a threshold stipulated by Instruction No.3/2011 issued under Section 268A of the Income Tax Act, 1961. The Court relied on its own judgment in COMMISSIONER OF INCOME TAX AND ANOTHER v/s RANKA AND RANKA. While dismissing the appeal on the ground of maintainability, the Court explicitly stated that it was not expressing any opinion on the merits of the case. Liberty was reserved for the Revenue to make a necessary application to seek revival of the appeal if their Special Leave Petition against the Ranka and Ranka case was successful.

What were the facts?

The Commissioner of Income-tax and the Income Tax Officer (Appellants) filed an appeal under Section 260A of the Income Tax Act, 1961, against an order of the Income Tax Appellate Tribunal, Bangalore. The appeal challenged the Tribunal's order in ITA No.880/Bang/2006 dated January 16, 2009. The respondent is M/s. Sastry Electronic & Accessories. The appellants sought to set aside the Tribunal's order and confirm the orders of the lower authorities. The appeal was filed in the High Court of Karnataka at Bangalore.

What were the issues?

1. Whether the appeal is maintainable in view of Instruction No.3/2011 issued by the Central Board of Direct Taxes under Section 268A of the Income Tax Act, 1961, given that the tax effect is less than Rs.10,00,000/-? (Question of law) Assessee's contention: The respondent (assessee) argued that the appeal is not maintainable due to the low tax effect, citing Instruction No.3/2011 and the High Court's judgment in COMMISSIONER OF INCOME TAX AND ANOTHER v/s RANKA AND RANKA reported in (2012) 72 DTR (KAR) 270. Revenue's contention: The revenue acknowledged that a Special Leave Petition (SLP) against the Ranka and Ranka judgment was pending before the Supreme Court. They noted that similar matters had been disposed of by the High Court with liberty to seek revival of appeals after the SLP's disposal. The revenue requested liberty to make an application for revival of the appeal.

Which sections of the Income-tax Act were involved?

Section 260A,Section 268A

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KARNATAKA AT BANGALORE

DATED THIS THE 10th DAY OF FEBRUARY 2014

PRESENT

THE HON’BLE MR. JUSTICE DILIP B.BHOSALE AND THE HON’BLE MR. JUSTICE B.MANOHAR

I.T.A. No.914/2007

BETWEEN :

1.

The Commissioner of Income-tax, CIT(A), C.R.Building, Queens Road, Bangalore.

2.

The Income Tax Officer, Central Circle 2(3), Bangalore. …APPELLANTS

(By Sri. M.Thirumalesh, Adv.)

AND :

M/s.Sastry Electronic & Accessories, No.175, 6th Cross, Gandhinagar, Bangalore – 560 009. …RESPONDENT

(By Sri.A.Shankar, Adv.) . . . .

This I.T.A. is filed under Section 260A of the Income Tax Act, 1961 praying to (i) formulate the substantial questions of law stated therein, (ii) allow the appeal and set-aside the order passed by the Income Tax Appellate Tribunal, Bangalore in I.T.A. No.880/Bang/2006 dated 16.01.2009 and confirm the

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order of the Appellate Commissioner confirming the order passed by the Income Tax Officer, Central Circle – 2(3), Bangalore, in the interest of justice and equity.

This I.T.A. coming on for hearing, this day, Dilip B.Bhosale, J., delivered the following:

JUDGMENT

Learned counsel appearing for the respondent submits that this appeal is not maintainable in view of Instruction No.3/2011 dated 9-2-2011 issued by the Central Board of Direct Tax under Section 268A of the Income Tax Act, 1961, since the tax effect in the instant appeal is less than Rs.10,00,000/-. He also brought to our notice the judgment in COMMISSIONER OF INCOME TAX AND ANOTHER v/s RANKA AND RANKA reported in (2012) 72 DTR (KAR) 270.

2.

Mr.K.V.Aravind, learned counsel for the revenue submits that against the order made in Ranka and Ranka, the revenue has preferred a Special Leave Petition before the Hon’ble Supreme Court and it is pending consideration. He submits that identical matters have been disposed of by this Court in terms of

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the order made in Ranka and Ranka, reserving liberty to the Revenue to seek revival of the appeal after disposal of the Special Leave Petition filed. He, therefore, requested to grant liberty to the Revenue to make necessary application for revival of the appeal.

3.

In view of the submissions made, the present appeal is dismissed as not maintainable since the tax effect is less than Rs.10,00,000/-. Without expressing any opinion on merits of the case, liberty is reserved to the Revenue to make necessary application to seek revival of the appeal, if they succeed in the Special Leave Petition filed against Ranka and Ranka’s case.

Sd/- JUDGE

Sd/- JUDGE

SPS

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