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1 IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 31ST DAY OF MAY, 2016
PRESENT
THE HON’BLE MR.JUSTICE JAYANT PATEL AND THE HON’BLE MR.JUSTICE B.SREENIVASE GOWDA ITA NO.689/2015 C/W ITA Nos.690,691,692,693,694,695,696/2015
IN ITA NO.689/2015
BETWEEN:
THE COMMISSIONER OF INCOME-TAX, TDS, NO.59, HMT BHAVAN, 4TH FLOOR, BELLARY ROAD, GANGANAGAR, BANGALORE-560 032.
THE ASST. COMMISSIONER OF INCOME-TAX, (TDS), CIRCLE-16(1), NO.59, HMT BHAVAN, 4TH FLOOR BELLARY ROAD, GANGANAGAR, BANGALORE-560 032. ... APPELLANTS
(By SRI. K. V. ARAVIND, ADV.)
2 AND:
M/S. BANGALORE CITY EMPLOYEES, HOUSING & SOCIAL WELFARE, CO-OPERATIVE SOCIETY LTD., NO.20, 3RD MAIN ROAD, 3RD CROSS, VIDYAGIRI LAYOUT, NAGARBHAVI 1ST STAGE, BANGALORE-560 072. ... RESPONDENT
THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF THE INCOME TAX ACT, 1961, ARISING OUT OF ORDER DATED 31/07/2015 PASSED IN ITA NO.960/BANG/2011, FOR THE ASSESSMENT YEAR 1996- 1997 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE.
IN ITA NO.690/2015:
BETWEEN:
THE COMMISSIONER OF INCOME-TAX, TDS, NO.59, HMT BHAVAN, 4TH FLOOR, BELLARY ROAD, GANGANAGAR, BANGALORE-560 032.
THE ASST. COMMISSIONER OF INCOME-TAX (TDS), CIRCLE-16(1), NO.59, HMT BHAVAN, 4TH FLOOR BELLARY ROAD, GANGANAGAR, BANGALORE-560 032. ... APPELLANTS
(By SRI. K. V. ARAVIND, ADV.)
3 AND:
M/S. BANGALORE CITY EMPLOYEES, HOUSING & SOCIAL WELFARE, CO-OPERATIVE SOCIETY LTD., NO.20, 3RD MAIN ROAD, 3RD CROSS, VIDYAGIRI LAYOUT, NAGARBHAVI 1ST STAGE, BANGALORE-560 072. ... RESPONDENT
THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF THE INCOME TAX ACT, 1961, ARISING OUT OF ORDER DATED:31/07/2015 PASSED IN ITA NO. 269/BANG/2015, FOR THE ASSESSMENT YEAR 1997-1998 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE.
IN ITA NO.691/2015
BETWEEN:
THE COMMISSIONER OF INCOME-TAX, TDS, NO.59, HMT BHAVAN, 4TH FLOOR, BELLARY ROAD, GANGANAGAR, BANGALORE-560 032.
THE ASST. COMMISSIONER OF INCOME-TAX (TDS), CIRCLE-16(1), NO.59, HMT BHAVAN, 4TH FLOOR BELLARY ROAD, GANGANAGAR, BANGALORE-560 032. ... APPELLANTS
(By SRI. K. V. ARAVIND, ADV.)
4 AND:
M/S. BANGALORE CITY EMPLOYEES, HOUSING & SOCIAL WELFARE, CO-OPERATIVE SOCIETY LTD., NO.20, 3RD MAIN ROAD, 3RD CROSS, VIDYAGIRI LAYOUT, NAGARBHAVI 1ST STAGE, BANGALORE-560 072. ... RESPONDENT
THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF THE INCOME TAX ACT, 1961, ARISING OUT OF ORDER DATED 31/07/2015 PASSED IN ITA NO. 270/BANG/2015, FOR THE ASSESSMENT YEAR 1998-1999 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE.
IN ITA NO.692/2015
BETWEEN:
THE COMMISSIONER OF INCOME-TAX, TDS, NO.59, HMT BHAVAN, 4TH FLOOR, BELLARY ROAD, GANGANAGAR, BANGALORE-560 032.
THE ASST. COMMISSIONER OF INCOME-TAX (TDS), CIRCLE-16(1), NO.59, HMT BHAVAN, 4TH FLOOR BELLARY ROAD, GANGANAGAR, BANGALORE-560 032. ... APPELLANTS
(By SRI. K. V. ARAVIND, ADV.)
5 AND:
M/S. BANGALORE CITY EMPLOYEES, HOUSING & SOCIAL WELFARE, CO-OPERATIVE SOCIETY LTD., NO.20, 3RD MAIN ROAD, 3RD CROSS, VIDYAGIRI LAYOUT, NAGARBHAVI 1ST STAGE, BANGALORE-560 072. ... RESPONDENT
THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF THE INCOME TAX ACT, 1961, ARISING OUT OF ORDER DATED 31/07/2015 PASSED IN ITA NO. 271/BANG/2015, FOR THE ASSESSMENT YEAR 1999-2000 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE.
IN ITA NO.693/2015
BETWEEN:
THE COMMISSIONER OF INCOME-TAX, TDS, NO.59, HMT BHAVAN, 4TH FLOOR, BELLARY ROAD, GANGANAGAR, BANGALORE-560 032.
THE ASST. COMMISSIONER OF INCOME-TAX (TDS), CIRCLE-16(1), NO.59, HMT BHAVAN, 4TH FLOOR BELLARY ROAD, GANGANAGAR, BANGALORE-560 032. ... APPELLANTS
(By SRI. K. V. ARAVIND, ADV.)
6 AND:
M/S. BANGALORE CITY EMPLOYEES, HOUSING & SOCIAL WELFARE, CO-OPERATIVE SOCIETY LTD., NO.20, 3RD MAIN ROAD, 3RD CROSS, VIDYAGIRI LAYOUT, NAGARBHAVI 1ST STAGE, BANGALORE-560 072. ... RESPONDENT
THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF THE INCOME TAX ACT, 1961, ARISING OUT OF ORDER DATED 31/07/2015 PASSED IN ITA NO. 272/BANG/2015, FOR THE ASSESSMENT YEAR 2000-2001 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE.
IN ITA NO.694/2015
BETWEEN:
THE COMMISSIONER OF INCOME-TAX, TDS, NO.59, HMT BHAVAN, 4TH FLOOR, BELLARY ROAD, GANGANAGAR, BANGALORE-560 032.
THE ASST. COMMISSIONER OF INCOME-TAX (TDS), CIRCLE-16(1), NO.59, HMT BHAVAN, 4TH FLOOR BELLARY ROAD, GANGANAGAR, BANGALORE-560 032. ... APPELLANTS
(By SRI. K. V. ARAVIND, ADV.)
7 AND:
M/S. BANGALORE CITY EMPLOYEES, HOUSING & SOCIAL WELFARE, CO-OPERATIVE SOCIETY LTD., NO.20, 3RD MAIN ROAD, 3RD CROSS, VIDYAGIRI LAYOUT, NAGARBHAVI 1ST STAGE, BANGALORE-560 072. ... RESPONDENT
THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF THE INCOME TAX ACT, 1961, ARISING OUT OF ORDER DATED 31/07/2015 PASSED IN ITA NO. 273/BANG/2015, FOR THE ASSESSMENT YEAR 2001-2002 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE.
IN ITA NO.695/2015
BETWEEN:
THE COMMISSIONER OF INCOME-TAX, TDS, NO.59, HMT BHAVAN, 4TH FLOOR, BELLARY ROAD, GANGANAGAR, BANGALORE-560 032.
THE ASST. COMMISSIONER OF INCOME-TAX (TDS), CIRCLE-16(1), NO.59, HMT BHAVAN, 4TH FLOOR BELLARY ROAD, GANGANAGAR, BANGALORE-560 032. ... APPELLANTS
(By SRI. K. V. ARAVIND, ADV.)
8 AND:
M/S. BANGALORE CITY EMPLOYEES, HOUSING & SOCIAL WELFARE, CO-OPERATIVE SOCIETY LTD., NO.20, 3RD MAIN ROAD, 3RD CROSS, VIDYAGIRI LAYOUT, NAGARBHAVI 1ST STAGE, BANGALORE-560 072. ... RESPONDENT
THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF THE INCOME TAX ACT, 1961, ARISING OUT OF ORDER DATED 31/07/2015 PASSED IN ITA NO. 274/BANG/2015, FOR THE ASSESSMENT YEAR 2002-2003 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE.
IN ITA NO.696/2015
BETWEEN:
THE COMMISSIONER OF INCOME-TAX, TDS, NO.59, HMT BHAVAN, 4TH FLOOR, BELLARY ROAD, GANGANAGAR, BANGALORE-560 032.
THE ASST. COMMISSIONER OF INCOME-TAX (TDS), CIRCLE-16(1), NO.59, HMT BHAVAN, 4TH FLOOR BELLARY ROAD, GANGANAGAR, BANGALORE-560 032. ... APPELLANTS
(By SRI. K. V. ARAVIND, ADV.)
9 AND:
M/S. BANGALORE CITY EMPLOYEES, HOUSING & SOCIAL WELFARE, CO-OPERATIVE SOCIETY LTD., NO.20, 3RD MAIN ROAD, 3RD CROSS, VIDYAGIRI LAYOUT, NAGARBHAVI 1ST STAGE, BANGALORE-560 072. ... RESPONDENT
THIS INCOME TAX APPEAL IS FILED UNDER SECTION 260-A OF THE INCOME TAX ACT, 1961, ARISING OUT OF ORDER DATED 31/07/2015 PASSED IN ITA NO. 275/BANG/2015, FOR THE ASSESSMENT YEAR 2004-2005 PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE.
THESE APPEALS COMING ON FOR ORDERS THIS DAY, JAYANT PATEL J., DELIVERED THE FOLLOWING:
J U D G M E N T
In all the matters, the office has raised objections on the ground of maintainability of the appeals since the tax effect is below `20,00,000/-.
We have heard Sri. K.V. Aravind, learned counsel appearing for the appellants/Revenue. He fairly conceded that the Circular has been issued vide dated
10 10.07.2014 for not to pursue the matter where tax effect is less than `20,00,000/-. But as per him, the stand of the department is that whole case may fall in the exceptional category as mentioned in para 8 of the Circular and therefore, office objection may not be maintained.
Paragraph 8 of the aforesaid Circular reads as under:-
“8. Adverse judgments relating to the following issues should be contested on merits notwithstanding that the tax effect entailed is less than the monetary limits specified in para 3 above or there is no tax effect . (a) Where the Constitutional validity of the provisions of an Act or Rule are under challenge, or
11 (b) Where Board’s order, Notification, Instruction or Circular has been held to be illegal or ultra vires, or
(c) Where Revenue Audit objection in the case has been accepted by the Department.”
The contention of the learned counsel for the appellants/Revenue was that it would fall in the category of Clause (a) of above paragraph No. 8.
When we further enquired with the counsel as to whether constitutional validity of any of the provision of the Act or Rule was challenged or not, he conceded that they were not challenged before the Tribunal. Further, he submits that since statutory provision is interpreted by the Tribunal to apply with the retrospective effect, it may fall in the category of Clause(a) of the paragraph No.8.
In our view, the contention is not well-founded and also on non-existent premises. When there was no constitutional validity of any provision or Rule under the challenge before the Tribunal, it cannot be said that the present matter may fall in the exceptional category of clause (a) of paragraph 8 referred to herein above.
The tax effect is less than prescribed limit in all the matters. Hence, office objection is maintained with the observation that in the appropriate case when the question arises for interpretation of the provisions of the Act which is considered by the Tribunal, the said question shall remain open with further clarification that tax effect in respective matter may be exceeding the minimum prescribed limit.
These petitions stand disposed of accordingly.
SD/- JUDGE
SD/- JUDGE
PMR/-