THE COMMISSIONER OF INCOME-TAX vs. M/S. GOPALAN ENTERPRISES

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ITA/313/2015HC KarnatakaKAHC01027564201530 August 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 by the Department before the ITAT, High Courts, and Supreme Court from Rs. 50,00,000/- to Rs. 1,00,00,000/-. A subsequent communication dated August 20, 2019, from the CBDT clarified that this revised monetary limit was applicable to all pending appeals. The court granted liberty to the appellant to seek revival of the appeal if it was found that the matter fell within the exceptions carved out in Clause 10 of Circular No. 3 of 2018. No specific finding was made on the merits of the case, as the appeal was withdrawn based on procedural grounds related to monetary limits.

What were the facts?

The appeal was filed by the Commissioner of Income Tax and the Deputy Commissioner of Income Tax (the Revenue) against an order dated January 22, 2015, passed by the Income-Tax Appellate Tribunal (ITAT), Bangalore, in ITA No. 1502/Bang/2013. This order had confirmed the order of the Appellate Commissioner, which in turn had confirmed the order of the Deputy Commissioner of Income Tax. The assessment year in question was 2007-2008. 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. The Revenue requested to withdraw the appeal based on this circular, with liberty to revive it if the case fell under exceptions.

What were the issues?

1. Whether the appeal filed by the Revenue is maintainable in light of the revised monetary limits for filing appeals as per Circular No. 17 of 2019, which superseded Circular No. 3 of 2018. Contentions: Assessee: The judgment does not record any specific contentions from the assessee's side regarding the maintainability of the appeal or the applicability of the circulars. The assessee was represented by Smt. S.R. Anuradha, Advocate. Revenue: The Revenue contended that the appeal was not maintainable due to the revised monetary limit of Rs. 1 crore, as per Circular No. 17 of 2019. They argued that the earlier limit was Rs. 50 lakh. The Revenue also referred to Clause 10 of Circular No. 3 of 2018, which carves out exceptions, and submitted that it was not possible to ascertain at that stage if the matter fell under any exception. They prayed for liberty to move the court for revival if the matter was found to be within the exceptions. The Revenue relied on Circular No. 17 of 2019 and Circular No. 3 of 2018, and a communication dated August 20, 2019, from the CBDT clarifying that the new monetary limit was applicable to pending appeals.

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 30TH DAY OF AUGUST, 2019 PRESENT THE HON’BLE MR.JUSTICE L. NARAYANA SWAMY AND THE HON’BLE MR.JUSTICE R. DEVDAS INCOME TAX APPEAL NO.313/2015 BETWEEN:

1.

THE COMMISSIONER OF INCOME TAX C.R. BUILDING, QUEENS ROAD, BANGALORE .

2.

THE DEPUTY COMMISSIONER OF INCOME TAX CIRCLE -11(3), RASHTROTHANA BHAVAN, NRUPATHUNGA ROAD, BANGALORE-560 001. ...APPELLANTS

(BY SRI K.V. ARAVIND AND SRI DILIP M., ADVOCATES)

AND:

M/S. GOPALAN ENTERPRISES INDIA PVT. LIMITED, NO.5, RICHMOND ROAD, BANGALORE-560 025. ... RESPONDENT (BY SMT. S.R. ANURADHA, ADVOCATE)

THIS ITA IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED 22.01.2015 PASSED IN ITA NO.1502/BANG/2013, FOR THE ASSESSMENT YEAR 2007- 2008. PRAYING TO: I. FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE. II. ALLOW THE APPEAL AND SET ASIDE THE ORDER PASSED BY THE ITAT, BANGALORE IN ITA NO.1502/BANG/2013 DATED:22/01/2015 CONFIRMING THE ORDER OF THE APPELLATE COMMISSIONER AND CONFIRM THE ORDER PASSED BY THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-11(3), BANGALORE.

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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