THE COMMISSIONER OF INCOME TAX vs. SRI M KRISHNA ALVA

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ITA/542/2007HC KarnatakaKAHC01040308200728 October 2013Bench: N.KUMAR,RATHNAKALA3 pages
AI SummaryDismissed

What did the High Court hold?

The High Court dismissed the appeal without going into the merits. This was based on a previous judgment that held CBDT Instruction No. 3 of 2011, regarding tax effect for appeals, to be retrospective.

What were the facts?

The Revenue appealed against an ITAT order that disallowed expenditure incurred by the assessee while computing capital gains. The tax effect of the appeal was Rs. 4,91,227.

What were the issues?

Whether the appeal filed by the Revenue is maintainable given the tax effect is less than Rs. 10 lakhs, considering the retrospective application of CBDT Instruction No. 3 of 2011.

Which sections of the Income-tax Act were involved?

Section 260-A

AI-generated summary — verify with the full judgment below

- - 1 IN THE HIGH COURT OF KARNATAKA AT BANGALORE

DATED THIS THE 28TH DAY OF OCTOBER 2013

PRESENT

THE HON’BLE MR.JUSTICE N.KUMAR

AND

THE HON’BLE MRS.JUSTICE RATHNAKALA

INCOME TAX APPEAL NO.542 OF 2007

BETWEEN:

1.

The Commissioner of Income-Tax, 284/1, Park View Building, 4th Main, P.J. Extension, Davangere-2

2.

The Income-Tax Officer, Ward-3, Shimoga.

.. APPELLANTS

(By Sri K.V. Aravind, Adv.)

AND:

Sri M. Krishna Alva, Karavali Leather Works, Industrial Estate, Bhadravati.

..RESPONDENT

(By Sri P.A. Bhat, ADV.)

This appeal is filed under Section 260-A of I.T. Act 1961, arising out of Order dated 18-01-2007 passed in ITA No. 129/BANG/2005, for the Assessment Year 1998-99, praying that this Hon'ble Court may be pleased to:

i. formulate the substantial questions of law stated therein,

- - 2 ii. allow the appeal and set aside the order passed by the ITAT, Bangalore Bench-B in ITA No. 129/BANG/2005 dated 18-01-2007 and confirm the Order Passed by the Assessing Officer, in the interest of justice and equity.

This Appeal coming on for orders this day, KUMAR J., delivered the following:

J U D G M E N T

This appeal is preferred by the Revenue, challenging the order passed by the Tribunal, which has disallowed the expenditure incurred by the assessee while computing the capital gains. The net tax effect, which is the subject matter of the appeal, is Rs.4,91,227/-.

2.

In view of the judgment of this Court in the case of Commissioner of Income Tax & Another –vs- Ranka and Ranka reported in 2012(72) DTR (Kar) 270, wherein it was held that notwithstanding Clause 11 of CBDT Instruction No.3 of 2011 dated 9th February 2011, expressly providing that the instructions will apply to appeals filed on or after 9th February 2011 and appeals filed earlier will be governed by contemporaneous instructions, the application of said instructions needs to be extended to appeals pending as on 9th February 2011. In other words, the said instruction was held to be retrospective. In view of the said instructions, the appeal

- - 3 preferred by the Revenue where the tax effect is less than Rs.10 lakhs is not maintainable.

Accordingly, without going into the merits of the appeal, it is dismissed on the ground of tax effect being less than Rs.10 lakhs.

The judgment of this Court in the case of Ranka & Ranka referred to supra, is said to be now pending before the Apex Court. In the event of the Apex Court reversing the judgment of this Court, liberty is reserved to the Revenue to seek for revival of this appeal. Ordered accordingly.

Sd/-

JUDGE

Sd/-

JUDGE

KNM/-

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