DEPUTY COMMISSIONER OF INCOME TAX, CORPORATE CIRCLE-1, COIMBATORE, COIMBATORE vs. M/S SAKTHI SUGARS LIMITED, COIMBATORE
Facts
The assessee filed a return declaring a business loss. The AO initiated reassessment proceedings under Section 147, alleging contravention of Section 269T for loan repayment, although no additions were made to the assessee's income. The CIT(A) ruled that there was no violation of Section 269T as the loan was settled through book entries and that the Section 147 proceedings were invalid due to no escapement of income.
Held
The Income Tax Appellate Tribunal dismissed the revenue's appeal. It found that since the Assessing Officer had made no additions and there was no tax demand, the tax effect was nil. Consequently, the appeal fell below the monetary limit of Rs. 60 lakhs for filing appeals by the revenue, as prescribed by CBDT Circular 09/2024.
Key Issues
Whether an appeal by the revenue is maintainable before the Tribunal when the tax effect is nil and falls below the prescribed monetary limits set by the CBDT for filing appeals.
Sections Cited
250, 143(3), 269T, 148A(b), 147
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, C BENCH: CHENNAI
Before: SHRI ABY T. VARKEY & MS. PADMAVATHY.S
आदेश / O R D E R PER PADMAVATHY.S, A.M: This appeal by the revenue is against the order of the Commissioner of Income Tax (Appeals)/National Faceless Appeal Centre (NFAC), Delhi, (in short "CIT(A)") passed u/s. 250 of the Income Tax Act, 1961 (in short "the Act") dated 25.08.2025 for Assessment Year (AY) 2018-19.
The assessee is a company and filed the return of income for AY 2018- 19 on 5.10.2018 declaring a business loss of ₹ 92, 70, 56, 472/-. The case is selected for scrutiny and the statutory notices were duly served on the assessee. The assessment was completed under section 143(3) accepting the
ITA No.2913/Chny/2025 :- 2 -:
income returned by the assessee. Subsequently the assessing officer noticed that the assessee has repaid loan to the tune of Rs.8,35,00,000/- in contravention of the provisions of section 269T of the act. The assessing officer therefore issued the notice under section148A(b) calling on the assessee to furnish the relevant details. The assessing officer passed order under section 147 without making any additions. However the assessing officer has stated in the assessment order that the assessee has infringed the provisions of section 269T related to the repayment of loan. The assessee filed further appeal before the CIT(A). The CIT(A) held that that the legislative intent behind 269T is to curb black money and in assessee's case since the loan is settled by the assessee through book entries there is no violation under section 269T. The CIT(A) also held that the proceedings initiated under section 147 on the ground that infringement of the provisions of section 269T cannot be a ground for reopening since there is no escapement of income. The revenue is an appeal before the tribunal against the order of the CIT(A).
We heard the parties and perused the material on record. We notice that in the assessment completed under section 147 the assessing officer did not make any addition. Therefore there is no tax demand that is arising out of the impugned assessment order. The Central Board of direct taxes (CBDT) wide circular number 09/2024 dated 17 September 2024 has set the monetary limit of tax effect for filing the appeal by the revenue at Rs.60 lakhs. In the given case it is an undisputed fact that the tax effect is nil and therefore we are of the considered view that the appeal filed by the revenue need to be dismissed on the ground of the tax effect are being below the monetary limit as fixed by
ITA No.2913/Chny/2025 :- 3 -:
the CBDT wide the above circular. Accordingly we dismiss the appeal filed by the revenue on the ground of monetary limits.
In result the appeal of the revenue is dismissed
Order pronounced on 17th day of February, 2026 at Chennai.
Sd/- Sd/- (एबी टी. वक�) (पदमावती यस) (ABY. T. Varkey) (Padmavathy.S) लेखा सद�य /Accountant Member �याियक सद�य / Judicial Member चे�नई/Chennai, �दनांक/Dated: 17th February, 2026. EDN, Sr. P.S आदेश क� ��त�ल�प अ�े�षत/Copy to: 1. अपीलाथ�/Appellant 2. ��थ�/Respondent 3. आयकर आयु�/CIT, Chennai/Madurai/Coimbatore/Salem 4. िवभागीय �ितिनिध/DR 5. गाड� फाईल/GF
