THE PR. COMMISSIONER OF INCOME TAX vs. M/S ALLIANCE INFRASTRUCTURE

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ITA/144/2016HC KarnatakaKAHC01054234201604 September 2019Bench: R DEVDAS,L.NARAYANA SWAMY4 pages
AI SummaryWithdrawn

What did the High Court hold?

The High Court permitted the appellant-Revenue to withdraw the appeal. The reasoning was based on the introduction of Circular No. 17 of 2019, which enhanced the monetary limit for filing appeals before the ITAT, High Courts, and Supreme Court from Rs. 50,00,000/- to Rs. 1,00,00,000/-. The Revenue's counsel pointed out that this circular, along with a subsequent CBDT clarification dated August 20, 2019, indicated that the new monetary limits were applicable to pending matters. The Revenue also highlighted Clause 10 of Circular No. 3 of 2018, which carves out exceptions. Since it was not immediately clear if the appeal fell under these exceptions, the Revenue sought withdrawal with liberty to revive. The Court granted this liberty, allowing the appellant to seek revival of the appeal if it is later determined that the matter falls within the exceptions specified in Clause 10 of Circular No. 3 of 2018. No decision was made on the merits of the original dispute.

What were the facts?

The appeal was filed by the Principal Commissioner of Income Tax and the Deputy Commissioner of Income Tax (Revenue) against an order dated August 14, 2015, passed by the Income-Tax Appellate Tribunal (ITAT), Bengaluru, in ITA No. 528/Bang/2015. This order had confirmed the order of the Appellate Commissioner, which in turn had upheld the order of the Deputy Commissioner of Income Tax. The assessment year in question was 2011-2012. The Revenue sought to formulate substantial questions of law and set aside the ITAT's order. During the hearing, the Revenue's counsel brought to the court's notice Circular No. 17 of 2019, which enhanced the monetary limit for filing appeals, and Circular No. 3 of 2018, which outlined exceptions. The Revenue requested to withdraw the appeal, seeking liberty to revive it if the case fell under the exceptions.

What were the issues?

1. Whether the appeal filed by the Revenue is maintainable in light of the enhanced monetary limits for filing appeals as per Circular No. 17 of 2019, which superseded Circular No. 3 of 2018. (Question of law) 2. Whether the present appeal falls under any of the exceptions carved out in Clause 10 of Circular No. 3 of 2018, thereby allowing it to proceed despite not meeting the enhanced monetary threshold. (Question of mixed law and fact) Contentions of the Assessee: The judgment does not record any specific contentions made by the assessee. The assessee was represented by counsel, but their arguments are not detailed. Contentions of the Revenue: The Revenue contended that Circular No. 17 of 2019, dated August 8, 2019, significantly raised the monetary limit for filing appeals from Rs. 50,00,000/- to Rs. 1,00,00,000/-. They submitted that the appeal might not be maintainable under this new limit. The Revenue also referred to Clause 10 of Circular No. 3 of 2018, which lists exceptions to the monetary limit, and stated that it was unclear at that stage if the present case fell under any of these exceptions. They requested permission to withdraw the appeal with liberty to revive it if the exceptions applied. The Revenue further cited a CBDT communication dated August 20, 2019, clarifying that the new monetary limits are applicable to pending matters.

Which sections of the Income-tax Act were involved?

Section 260-A

AI-generated summary — verify with the full judgment below

IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 4TH DAY OF SEPTEMBER, 2019 PRESENT THE HON’BLE MR.JUSTICE L. NARAYANA SWAMY AND THE HON’BLE MR.JUSTICE R. DEVDAS INCOME TAX APPEAL No.144/2016 BETWEEN:

1.

THE PR. COMMISSIONER OF INCOME TAX 5TH FLOOR, BMTC BUILDING 80 FEET ROAD, KORMANGALA BANGALORE-560 095

2.

THE DY. COMMISSIONER OF INCOME TAX CIRCLE-1(1)(1), 2ND FLOOR BMTC BUILDING, 80 FEET ROAD KORMANGALA, BANGALORE-560 095 ... APPELLANTS

(BY SRI K.V.ARAVIND & SRI DILIP M., ADVS.)

AND:

M/S ALLIANCE INFRASTRUCTURE PROJECTS PVT. LTD NO.85, KARTHIK NAGAR MARATHAHALLI, K R PURAM OUT RING ROAD, BANGALORE-560 037

... RESPONDENT

(BY SRI M.LAVA, ADV.)

THIS ITA IS FILED UNDER SECTION 260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED:14/08/2015 PASSED IN ITA NO.528/BANG/2015, FOR THE ASSESSMENT YEAR 2011-2012.

PRAYING TO: I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE. II. ALLOW THE APPEAL AND SET ASIDE THE ORDER PASSED BY THE ITAT, BENGALURU IN ITA NO. 528/BANG/2015 DATED:14/08/2015 CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE DY. COMMISSIONER OF INCOME TAX, CIRCLE-1(1)(1), BENGALURU.

THIS ITA COMING ON FOR HEARING, THIS DAY, DEVDAS J., DELIVERED THE FOLLOWING:

J U D G M E N T The learned counsel for the appellant-Revenue brings to the notice of this Court a Circular bearing No.17 of 2019 dated 08th August, 2019 wherein the further enhancement of monetary limit for filing of appeals by the Departments before the Income- Tax Appellate Tribunals, High Courts and Special Leave Petitions/Appeals before the Supreme Court stands amended, and by the said amendment the earlier monetary limit of Rs.50,00,000/- (Rupees fifty lakh) has not been raised to Rs.1,00,00,000/- (Rupees one crore). The earlier monetary limit was prescribed as per Circular No.3 of 2018 dated 11th July, 2018. In the light of the same, the learned counsel submits that the appeal is not maintainable and in view of the Circular, the appeal may be permitted to be withdrawn. Further, the learned counsel would also draw the attention of this Court to Clause 10

of the Circular No.3 of 2018 dated 11th July, 2018 wherein certain exceptions are carved out. The learned counsel submits that at the present stage it may not be possible for him to submit whether the matter falls under any of the exceptions. Therefore, it is prayed that liberty may be reserved to the appellants to move this Court, if it is found that the matter falls within the exception carved out in Clause 10 of Circular bearing Number 3 of 2018.

2.

On the query of the Court as to whether the Circular is applicable to pending matters, the learned counsel draws the attention of this Court to the communication dated 20th August, 2019 made by the Central Board of Direct Taxation to all the Chief Commissioners of Income Tax clarifying at paragraph No.3 that the monetary limit prescribed in Circular No.17 of 2019 is applicable to all pending Special Leave Petitions, Appeals, Cross Objections and References.

3.

In view of the above, we permit the appellant to withdraw the appeal for the reasons stated above. Liberty is also granted to the appellant to seek revival of this appeal, if it is

found that the matter falls within the exception carved out in Clause 10 of Circular bearing No.3 of 2018.

Sd/- JUDGE

Sd/- JUDGE

lnn

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