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The High Court held that the Tribunal was correct in confirming the order of the Commissioner of Income Tax (Appeals). The Court dismissed the Tax Case Appeal filed by the Revenue and answered the substantial questions of law against the Revenue. The reasoning is based on previous judgments of the High Court and the Supreme Court. Specifically, the Court referred to the Supreme Court's decision in CIT v. Arihant Tiles & Marbles (P) Ltd., which distinguished the case of Lucky Minmat Pvt. Ltd. by highlighting that the latter dealt with mere mining and cutting, whereas Arihant Tiles involved polishing and conversion into slabs and tiles, which was considered manufacture. The Court also noted that the Supreme Court in Gem Granites held that polishing granites is different from rough granites and amounts to manufacture. The Court found the Revenue's reliance on Gem India Manufacturing Co. and Nishanth Exports to be distinguishable from the present case. The operative direction is that the appeal is dismissed.
The High Court dismissed the appeals filed by the Revenue on account of low tax effect, in terms of CBDT Circular No.17/2019. The Court noted the submission by the Revenue's counsel that the tax effect in these cases was below the enhanced monetary limit of Rs.1 Crore for filing or pursuing appeals before the High Court. Consequently, the substantial questions of law framed at the time of admission were left open. The Court granted liberty to the Revenue to seek restoration of the appeals if the tax effect was found to be above the threshold limit, to be heard and decided on merits. No costs were awarded.
The High Court held that the substantial questions of law were answered against the Revenue, following its own previous decisions, specifically citing CIT Vs. Best & Crompton Engineering Ltd. and CIT vs. Sanmar Speciality Chemicals Ltd. The Court noted that the issue of unabsorbed depreciation set-off against capital gains had been considered by various High Courts (Bombay, Punjab & Haryana, Gujarat) and the Supreme Court had dismissed SLPs against such decisions. The reasoning was that after the amendment by the Finance Act, 2001, unabsorbed depreciation becomes part of the depreciation of the subsequent year under Section 32(2) and can be set off against income under any head, including capital gains, without any time limit. Regarding the Section 263 issue, the Tribunal rightly noted that where two views are possible, the Assessing Officer's view should be upheld. The Tribunal found that the reasons cited in the show cause notice for revision were unsustainable, and therefore, the Commissioner's order invoking Section 263 was rightly set aside. The appeal was dismissed.
The High Court did not decide the substantial questions of law on merits. The assessee's counsel submitted a letter stating that the appeals had become infructuous. This was because a previous order by the same High Court, dated 10.7.2017, in a batch of appeals including those in the assessee's own case (reported as 398 ITR 462 (Mad.)), had allowed the appeals in favour of the assessee and granted complete relief regarding the deduction claimed under Section 80IB. Since the relief sought on merits had already been granted by the High Court in a related matter, the present appeals challenging the reassessment proceedings were dismissed as infructuous. The substantial questions of law were left open. No costs were awarded.
The High Court held that the substantial question of law framed for consideration had been answered against the Revenue in its own previous decisions. Specifically, the Court referred to its judgment in CIT Vs. Best & Crompton Engineering Ltd. (dated 02.08.2021), which in turn relied on CIT vs. Sanmar Speciality Chemicals Ltd. (2020) 428 ITR 237 (Madras). This earlier decision had considered similar issues and relied on judgments from the Bombay High Court (CIT v. Bajaj Hindustan Ltd., CIT v. Hindustan Unilever Ltd.) and the Punjab & Haryana High Court (CIT v. G.T.M. Synthetics Ltd.). The reasoning highlighted that the omission of the proviso to Section 32(2) and the amendment to Section 72 by the Finance Act, 2001, effective from 1st April 2001, dispensed with the condition of carrying on the same business for set-off of unabsorbed depreciation. This meant unabsorbed depreciation could be set off against income under any head. The Gujarat High Court's observation in General Motors India (P.) Ltd. was also cited, stating that unabsorbed depreciation becomes part of the current year's depreciation and is allowed to be set off against income under any head, including long-term capital gains, without limit after the amendments. Consequently, the appeal was dismissed.
The High Court held that the substantial questions of law framed in both appeals have been answered in favour of the assessee by previous Division Bench judgments of the same court. Specifically, regarding the additions made on interest on securities, the court followed the decision in CIT vs. City Union Bank Ltd. (2007) 291 ITR 0144 (Mad), which held that interest on securities is taxable only on specified dates when it becomes due for payment, in view of the third proviso to Section 145(1) of the Act. Regarding the loss on revaluation of securities, the court followed the decision in CIT vs. City Union Bank Ltd., where it was held that when investments are made in accordance with the Act and the market price changes, the difference could be allowed as depreciation. The court found no infirmity in the Tribunal's decision on this point. Consequently, the appeals filed by the revenue were dismissed.
The High Court held that the substantial questions of law were answered against the Revenue and in favour of the assessee, following a previous Division Bench decision of the same Court in Commissioner of Income Tax, LTU, Chennai vs. Areva T & D India Ltd. [(2021) 434 ITR 604 (Mad)]. The Court noted that the second substantial question of law before them was identical to one considered in the Areva T & D India Ltd. case. In that precedent, the Court had considered the issue of non-compete fee paid for the purpose of business, which did not entail an enduring benefit, and whether it was allowable as revenue expenditure. The Court distinguished the facts of the present case from the Delhi High Court's decision in Sharp Business System, noting significant factual differences. The Tribunal's finding that the non-compete fee was for the purpose of business and did not result in an enduring benefit was upheld. Consequently, the appeals filed by the Revenue were dismissed.
The High Court allowed the appeal filed by the assessee, holding that the substantial questions of law were answered in favour of the assessee. The Court relied on the Supreme Court's decision in CIT vs. Rajasthan and Gujarati Charitable Foundation Poona (2018) 402 ITR 0441 (SC). The Supreme Court had held that normal depreciation can be considered a legitimate deduction in computing the real income of an assessee on general principles or under Section 11(1)(a) of the Act. The Court rejected the revenue's argument that depreciation is only allowable under Section 32 and that allowing it would lead to a double benefit. The High Court affirmed the view that income of a charitable trust should be computed on commercial principles, including the allowance for normal depreciation, even if the assets are not business assets and the trust is not carrying on a business. The Court noted that Section 11(6) was amended prospectively from AY 2015-16 to clarify this position. The operative direction was to allow the appeal, thereby granting the benefit of depreciation to the assessee.
The High Court held that the substantial questions of law were answered against the Revenue, following its own previous decision in CIT vs. Sanmar Speciality Chemicals Ltd. The Court referred to Circular No. 14/2001 issued by the CBDT, which clarified that the restriction of 8 years for carry forward and set off of unabsorbed depreciation was dispensed with to enable industries to conserve funds for replacing plant and machinery. The Court, referencing the Gujarat High Court's decision in General Motors India (P) Ltd. vs. DCIT, held that any unabsorbed depreciation available on 1st April 2002 (Assessment Year 2002-03) would be dealt with under the amended provisions of Section 32(2). Once the circular clarified that the 8-year restriction was dispensed with, unabsorbed depreciation from Assessment Year 1997-98 onwards got carried forward to Assessment Year 2002-03 and subsequent years without any time limit. The Bombay High Court's decision in PCIT vs. Gunnebo India Pvt. Ltd. was also cited in favour of the assessee. Therefore, the appeal was dismissed.
The High Court, by order dated 18.08.2021, dismissed the appeal, answering all substantial questions of law against the Revenue, following its own previous decisions in similar matters. Specifically, regarding the second substantial question of law concerning the set-off of unabsorbed depreciation, the Court relied on CIT vs. Best & Crompton Engineering Ltd. and CIT vs. Sanmar Speciality Chemicals Ltd., which in turn followed Bombay High Court decisions in CIT v. Bajaj Hindustan Ltd. and CIT v. Hindustan Unilever Ltd., and Punjab & Haryana High Court in CIT v. G.T.M. Synthetics Ltd. These decisions held that unabsorbed depreciation can be set off against income from any head, including capital gains, especially after amendments to Section 32(2) of the Income Tax Act. Regarding the third substantial question of law, concerning the order under Section 263, the Court, after hearing the Revenue's specific arguments, found that the Tribunal had correctly applied the principle that where two views are possible, the Assessing Officer's view should be upheld. The Tribunal had noted that the reasons cited in the show cause notice for invoking Section 263 were no longer sustainable, and therefore, the CIT(A)'s order was rightly set aside. The first question regarding the withdrawal of appeal was implicitly answered against the Revenue by the overall dismissal of the appeal. The operative direction was the dismissal of the appeal.
The High Court allowed the appeal, setting aside the ITAT's order and restoring the CIT(A)'s order. The Court held that the Rule of Consistency should be applied. For AY 2010-11, the Revenue had filed an appeal against the CIT(A)'s order granting exemption but later withdrew it, stating no appeal was necessary against the CIT(A)'s order. The Tribunal's order withdrawing the appeal explicitly noted the Revenue's application stating 'no appeal to the Appellate Tribunal is necessary'. The High Court found that the Assessing Officer for AY 2011-12 was bound by the CIT(A)'s order for AY 2010-11, which had attained finality and was not reversed or modified when the assessment order for AY 2011-12 was passed. The Court found that the Assessing Officer ignored judicial discipline by not adhering to the appellate authority's order. Therefore, the Tribunal ought not to have reversed the CIT(A)'s order. The substantial questions of law were left open as the appeal was allowed based on the Rule of Consistency.
The High Court held that the ITAT was correct in dismissing the Revenue's appeal and granting full relief to the assessee. The Court found that both the CIT(A) and the ITAT had concurrently held on facts that the assessee hired vehicles from drivers and there was nothing on record to infer any unwritten contract. Therefore, the question of deducting TDS under Section 194C did not arise, and consequently, Section 40(a)(ia) was not applicable. The Court distinguished the case of J. Rama v. Commissioner of Income Tax, stating that the facts in that case were entirely different, involving written contracts for hiring vehicles. The Court also noted that Section 194C was amended with effect from 01.10.2009, allowing for no TDS if PAN was furnished, although this amendment was not the primary basis for the decision in this case. The substantial questions of law were answered against the Revenue.
The High Court dismissed the appeal preferred by the Revenue against the order of the Income Tax Appellate Tribunal. The dismissal was based on the submission by the Revenue that the appeal was not being pursued due to a low tax effect, as per Circular No. 17/2019 of the Central Board of Direct Taxes. This circular increased the monetary limit for filing or pursuing appeals before the High Court to Rs. 1 Crore, and the tax effect in the present case was below this limit. Consequently, the substantial question of law framed at the time of admission of the appeal was left open. The Revenue was granted liberty to mention the case for restoration if the tax effect was found to be above the threshold limit in the future. No costs were awarded.
The High Court held that the substantial questions of law framed for consideration were answered against the Revenue by the Hon'ble Supreme Court in the case of Ajanta Pharma Ltd. vs. Commissioner of Income-Tax [(2010) 327 ITR 305 (SC)]. The Supreme Court in Ajanta Pharma Ltd. held that clause (iv) of Explanation to Section 115JB covers full export profits of 100% as "eligible profits" and the same cannot be reduced to 80% by relying on Section 80HHC(1B). The argument of the Department that both "eligibility" as well as "deductibility" of the profit have to be considered together for working out the deduction as mentioned in clause (iv) of Explanation to Section 115JB was found to be devoid of merits. This decision was followed by a Division Bench of the High Court in CIT vs. M/s.Bannari Amman Sugars Ltd. Accordingly, the substantial questions of law were answered in favour of the assessee, and the appeal filed by the assessee was allowed. No costs were awarded.
The High Court dismissed the appeal on the ground of low tax effect, as the tax effect was below the threshold limit prescribed by CBDT Circular No. 17/2019 dated 08.08.2019. The Court stated that the Revenue could not prosecute the appeal under these circumstances. Consequently, the substantial questions of law framed were left open and not decided on merits. The Court granted liberty to the Revenue to seek restoration of the appeal if the tax effect was found to be above the threshold limit. No costs were awarded. The specific findings and reasoning of the Tribunal on each of the substantial questions of law were not addressed by the High Court due to the dismissal on procedural grounds.
The High Court held that the proceedings under Section 263 were barred by limitation. The core issue was the starting point for calculating the two-year limitation period under Section 263(2). The Court noted that the reassessment proceedings under Section 147 were initiated for specific reasons, and the assessment order dated 30.12.2011 addressed those specific reasons. However, the CIT initiated Section 263 proceedings concerning a business loss of Rs.72.75 Crores, which was an issue that had been raised and accepted in the original assessment order dated 28.12.2006, and was not part of the reassessment proceedings. Following the Supreme Court decision in CIT vs. Alagendran Finance Limited and the Bombay High Court's decision in Ashoka Buildcon Ltd. vs. ACIT, the Court held that if the issue sought to be revised under Section 263 was not part of the reassessment proceedings, the limitation period would commence from the date of the original assessment order. In this case, the original assessment order was dated 28.12.2006, meaning the limitation period for Section 263 would end on 31.3.2009. Since the CIT initiated proceedings on 26.3.2014, they were clearly time-barred. Explanation III to Section 147 was held not to alter this position. The appeal was dismissed.
The High Court held that the Tribunal had correctly followed the decision of the jurisdictional High Court in M/s. Simpson & Co. Ltd. vs. DCIT and EID Parry vs. The Assistant Commissioner of Income Tax, which had addressed similar issues regarding the disallowance of expenditure related to dividend income. The Tribunal had restricted the disallowance to Rs. 33,56,354, which was the amount already disallowed by the assessee. The Court found that the Tribunal's decision was based on established precedents from the jurisdictional High Court. Consequently, the Court concluded that no substantial question of law arose for consideration in the appeal. The appeal was dismissed.
The High Court noted that it was not necessary to decide the substantial questions of law due to subsequent developments. The Government of India enacted the Direct Tax Vivad Se Vishwas Act, 2020. The assessee had already filed the requisite Forms 1 & 2 under Section 4 of the Act on 29.12.2020. In light of the assessee availing the benefit under the Act, the appeal was disposed of. The Court directed the Department to process the application at the earliest. The assessee was granted liberty to restore the appeal if the ultimate decision under the Vivad Se Vishwas Act was not in their favour. In such an event, the Registry was to entertain the restoration petition without insisting on a condonation of delay application. The substantial questions of law were left open.
The High Court held that the term 'turnover' in ordinary accounting and commercial parlance refers to the sale proceeds from the goods in which the business unit primarily deals. The Supreme Court in CIT vs. Punjab Stainless Steel Industries was referred to, which clarified that sale proceeds from scrap, generated during the manufacturing of primary goods (like stainless steel utensils in this case), are not to be included in the 'turnover' as the assessee is not primarily dealing in scrap. The ICAI's Guidance Note on Tax Audit was also cited, defining 'sales turnover' as the aggregate amount for which sales are effected or services rendered. The Court found no error in the Tribunal's conclusion that scrap sales should be excluded from both total turnover and export turnover for computing the Section 10B exemption. The appeal was dismissed.
The High Court allowed the appeal, answering the substantial questions of law in favour of the assessee. For question (i) and (iii), the Court referred to a previous decision of the same High Court in T.C.A.Nos.732 and 733 of 2018, which held that Section 14A cannot be invoked if no exempt income was earned in the relevant assessment year. The Court also relied on the Supreme Court's decision in CIT vs. Chettinad Logistice (P.) Ltd. and the High Court's decision in Redington (India) Ltd. vs. Additional Commissioner of Income-tax. For question (ii) and (iii), the Court noted that income from letting out property in an industrial park/SEZ, along with amenities, is to be treated as business income, citing CBDT Circular No. 16 of 2017 and a Division Bench decision in CIT Vs. Elnet Technologies Limited. The Court found that the ITAT had rightly followed these legal positions. The appeal was allowed, and the substantial questions of law were answered in favour of the assessee.
The High Court held that the Tribunal was right in its conclusion that the reassessment proceedings were bad in law. The Court found that the assessee had made a full and true disclosure of all relevant materials at the time of the original assessment. The assessee had provided detailed explanations regarding the deferred revenue expenditure, classifying it as advertisement expenses for brand promotion and had chosen to write it off. These details were available to the Assessing Officer (AO) in the Profit and Loss account, Balance Sheet, Notes on Accounts, and the auditor's report. The AO had also sought specific information regarding this issue in his letter dated 20.08.2007, and the assessee had responded. Therefore, the ground for reopening, which was that the AO had not considered various points, was factually incorrect. The Court found no error in the Tribunal's approach or the relief granted to the assessee. The substantial question of law was answered against the revenue.
The High Court allowed the appeals and remanded the matters to the Assessing Officer for fresh consideration. The Court noted a subsequent development: the Commissioner of Income Tax (Exemptions) registered the assessee as a public religious Trust under Section 12AA of the Act with effect from 20.11.2003. This registration, granted after the ITAT's order, was a significant factor. The Court reasoned that in light of this retrospective registration, the assessments for the impugned assessment years (2010-11 and 2011-12) and the assessment orders dated 20.03.2013 and 31.03.2014 needed to be redone. The ITAT's order, the CIT(A)'s order, and the original assessment orders were set aside. The Assessing Officer was directed to redo the assessment, taking into account the Section 12AA registration, after affording an opportunity of personal hearing to the assessee. The substantial question of law was left undecided.
The High Court held that the authorities below and the Tribunal committed an error in fixing the rate of interest. The Court noted that the assessee had specifically stated that no interest was received from the subsidiary. The AO proceeded on presumption. The CIT(A) and the Tribunal concurred with the AO, considering the subsidiary's profitability and the long period of the advance. However, the High Court emphasized that tax can only be levied on real income, not presumptive income, unless there is evidence that the loans were extended for other purposes leading to an adverse presumption. The Court found no such evidence and concluded that no tax could be levied on presumptive income. Therefore, the appeal was allowed, and the substantial questions of law were answered in favour of the assessee.
The High Court dismissed the appeals filed by the Revenue. The Court noted that the substantial questions of law raised in these appeals were identical to those considered and decided in previous appeals (T.C.A.Nos.466 to 469 of 2015) decided on 03.08.2021. The Court referred to its own previous judgments, including those that followed the Supreme Court's decision in Commissioner of Income-tax, Central – III Vs. HCL Technologies Ltd. regarding the exclusion of freight, telecommunication, and insurance expenses from both export and total turnover for Section 10A calculations. The Court also relied on its decision in Commissioner of Income Tax, Chennai Vs. M/s.S.R.A. Systems Ltd. and M/s.Comstar Automative Technologies Private Ltd. which dealt with the conditions under Section 10A(2)(ii) and (iii) and the continuity of business. The Revenue could not point out any distinguishing features. Therefore, following the established precedents, the substantial questions of law were answered against the Revenue and in favour of the assessee. The appeals were dismissed, and no costs were imposed.
The High Court did not decide the substantial questions of law on their merits. The Revenue's counsel submitted that the appeal was not being pursued due to a low tax effect, citing CBDT Circular No. 17/2019 which increased the monetary limit for pursuing appeals before the High Court to Rs. 1 Crore. As the tax effect in this case was below this threshold, the High Court dismissed the appeal on this ground. The substantial questions of law were expressly left open. Liberty was granted to the Revenue to seek restoration of the appeal if the tax effect was found to be above the threshold limit, for a decision on merits. No costs were awarded.
The High Court allowed the appeal and answered the substantial questions of law in favour of the assessee. The Court followed its own prior judgment in T.C.A.Nos.170 & 171 of 2020 (M/s. S 1911 AN Udhur PACCS, Salem v. Principal Commissioner of Income Tax, Salem) and the Supreme Court's decision in Mavilayi Service Co-operative Bank Ltd. v. Commissioner of Income Tax, Calicut. The reasoning relied on the interpretation of 'members' and 'associate members' under the Tamil Nadu Cooperative Societies Act, 1983, and the applicability of Section 80P(4). The Court held that an 'associate member' is also a member for the purpose of Section 80P. It was also noted that the assessee society is a primary agricultural co-operative credit society, and the exclusion under Section 80P(4) pertains to 'cooperative banks', not such credit societies. The judgment did not expressly leave any issue undecided.
The High Court disposed of the appeal without deciding the substantial questions of law. The Court noted that the assessee had availed the Vivad se Vishwas Scheme and filed the necessary declaration (Form-3) and paid the entire tax. Consequently, the Revenue was directed to proceed with considering the Form-3 declaration in terms of the Direct Tax Vivad se Vishwas Act, 2020, and its Rules. The Court clarified that the assessee should not be put in a worse position due to the appeal being entertained after condoning the delay. The substantial questions of law were expressly left open for consideration. No operative directions were issued regarding the merits of the ITAT's order.
The appeals were dismissed as infructuous. The learned counsel for the appellant/assessee circulated a letter stating that the appeals had become infructuous because the ITAT, in rectification petitions filed by the assessee, had allowed the appeals in favour of the assessee for the assessment years under consideration. The High Court placed the submission on record and dismissed the tax case appeals. No decision was made on the substantial questions of law as the appeals were disposed of on a procedural ground. The operative direction was the dismissal of the appeals as infructuous.
The High Court set aside the order of the ITAT dated 27.02.2015 and remanded the matter to the Commissioner of Income Tax-I, Tiruchirappalli, for fresh consideration. The Court found that the ITAT had not adequately tested the conduct and bonafides of the assessee before deciding the substantial questions of law. The CIT was directed to issue notice to the assessee, hear them in detail, and pass a fresh order on merits, uninfluenced by the ITAT's observations or the Commissioner's earlier reasons for cancellation. The substantial questions of law were left open, and the appeal was disposed of. The principle established is that an assessee's conduct and bonafides must be examined before adjudicating on the legal grounds for cancellation of registration under Section 12AA, especially when the assessee has failed to appear and provide necessary documentation.
The High Court held that all the substantial questions of law were covered by previous decisions. Specifically, for the first two questions, the Court followed the Supreme Court's decision in Commissioner of Income-tax, Central – III Vs. HCL Technologies Ltd., which held that expenses like freight, telecommunication, and insurance attributable to the delivery of computer software should be allowed to be excluded from the total turnover in the same proportion as they are excluded from the export turnover, to avoid an illogical and unworkable result. For the third question, the Court relied on the decision in Commissioner of Income-tax v. Yokogawa India Ltd., which established that deductions under Section 10A are to be made while computing the gross total income under Chapter IV, not at the stage of computing total income under Chapter VI after setting off brought forward losses. Therefore, the Court decided all questions of law against the Revenue and in favour of the assessee.
The High Court dismissed the appeal as withdrawn on account of low tax effect, as submitted by the Revenue. The court noted that the tax effect in this case was less than the threshold limit stipulated in CBDT Circular No. 17/2019. The substantial questions of law framed were left open. The court granted liberty to the Revenue to seek restoration of the appeal if the tax effect was found to be above the threshold limit, allowing it to be heard and decided on merits. No costs were imposed. The specific findings of the ITAT on the exclusion of SPV investments and the 2% disallowance on other investments were not adjudicated upon by the High Court.
The High Court dismissed the appeal as withdrawn on account of low tax effect, as submitted by the Revenue. The Court noted that the Revenue's decision not to pursue the appeal was based on CBDT Circular No. 17/2019, which raised the monetary threshold for appeals to the High Court to Rs. 1 crore, and that the tax effect in this case was below that limit. The Court explicitly stated that the substantial question of law framed in the appeal was left open. Liberty was granted to the Revenue to seek restoration of the appeal if the tax effect was found to be above the threshold limit in the future, to be heard and decided on merits. No costs were awarded. The ITAT's order was not adjudicated upon merits by the High Court.
The High Court did not decide the substantial questions of law due to subsequent developments. The enactment of the Direct Tax Vivad Se Vishwas Act, 2020, allowed the assessee to resolve the disputed tax. The assessee informed the court that they had availed the benefit under this Act and sought to withdraw the appeals. The Court noted that the assessee had been issued Form-3 under the Act. Consequently, the appeals were dismissed as withdrawn. The Court granted liberty to the assessee to restore the appeals if the decision under the Vivad Se Vishwas Act was not in their favour. The substantial questions of law were left undecided.
The High Court dismissed the appeal. The Court noted that the Revenue's counsel conceded that the substantial questions of law had already been decided against the Revenue in a prior judgment of the same Bench in T.C.A.No.16 of 2014. This prior judgment, in turn, followed a Division Bench decision in T.C.A. No.732 & 733 of 2018. The reasoning in the cited judgments indicated that income from letting out premises/developed space along with other facilities in an industrial park/SEZ is to be charged to tax under the head 'Profits and Gains of Business'. This conclusion was supported by CBDT Circular No.16 of 2017 and the High Court's decision in CIT Vs. Elnet Technologies Limited, which was upheld by the Supreme Court (though on grounds of low tax effect). Therefore, all substantial questions of law were answered against the Revenue and in favour of the assessee. No specific issue was left undecided.
The High Court decided not to adjudicate the substantial questions of law due to subsequent developments. The Court noted the enactment of the Direct Tax Vivad Se Vishwas Act, 2020, which provides for the resolution of disputed tax. The assessee informed the Court that Form-3 had been issued under this Act, and therefore, sought permission to withdraw the appeal. The Court observed that no useful purpose would be served by keeping the appeal pending. Consequently, the Tax Case Appeal was dismissed as withdrawn. However, to safeguard the assessee's interest, liberty was granted to restore the appeal in the event the ultimate decision on the declaration filed under Section 4 of the Vivad Se Vishwas Act is not in favour of the assessee. If such a prayer is made, the Registry shall entertain it without insisting on a condonation of delay application. The substantial questions of law were left open.
The High Court did not decide the substantial questions of law framed for consideration. This was due to subsequent developments, specifically the enactment of the Direct Tax Vivad Se Vishwas Act, 2020. The learned counsel for the respondent/assessee submitted that the assessee had availed the Vivad Se Vishwas Scheme and had been issued Form-3 on April 15, 2021. Recording this submission, the High Court held that nothing further survived for adjudication in the appeal. Therefore, the Tax Case Appeal was disposed of. No costs were awarded. The specific findings of the ITAT on the disallowance under Section 40(a)(ia) and the interpretation of 'payable' were not reviewed or affirmed by the High Court.
The High Court did not decide the substantial questions of law framed for consideration. This was due to the enactment of the Direct Tax Vivad Se Vishwas Act, 2020. The learned counsel for the respondent/assessee submitted that the assessee had availed the Vivad Se Vishwas Scheme and had already been issued with Form-3 on 09.02.2021. Recording this submission, the High Court held that nothing further survived for adjudication in the appeal. Therefore, the Tax Case Appeal was disposed of on this basis. The operative direction was to dispose of the appeal. No costs were awarded. The specific findings on the interpretation of Section 40(a)(ia) or the application of the cited case laws were not reached by the court.
The High Court dismissed the appeal as withdrawn on account of low tax effect, as per CBDT Circular No. 17/2019. The court noted the submission by the Revenue's counsel that the tax effect was less than the threshold limit for filing or pursuing an appeal before the High Court. Consequently, the substantial questions of law framed were left open. The Revenue was granted liberty to mention the case for restoration if the tax effect was found to be above the threshold limit. No decision was made on the merits of the substantial questions of law.
The High Court dismissed the appeals as infructuous. The learned counsel for the appellant (assessee) submitted that an order dated 31.03.2017 had already been passed in favour of the appellant, rendering the present appeals moot. Consequently, the Court did not delve into the merits of the substantial questions of law concerning the allowability of gratuity provisions under Section 40A(7)(b) and the overriding effect of Section 43B(b). No finding was reached on these issues, and no operative directions were issued other than the dismissal of the appeals. The principle that could be cited from this judgment pertains to the procedural aspect of appeals becoming infructuous due to subsequent events.
The High Court dismissed the appeal as withdrawn on account of the low tax effect, as per CBDT Circular No. 17/2019. The Court noted that the Revenue's Senior Standing Counsel submitted that the appeal was not being pursued due to the tax effect being less than the increased monetary threshold of Rs. 1 crore for High Court appeals. Consequently, the appeal was dismissed as withdrawn. The substantial question of law framed for the appeal was expressly left open. Liberty was granted to the Revenue to seek restoration of the appeal if the tax effect was found to be above the threshold limit, to be heard and decided on merits. No costs were awarded.
The High Court dismissed the appeals filed by the Revenue. The dismissal was based on the submission by the Revenue's counsel that the appeals were not being pursued due to low tax effect, in accordance with CBDT Circular No. 17/2019, which increased the monetary limit for appeals to the High Court to Rs. 1 crore. The Court noted that the tax effect in these cases was below the threshold. Consequently, the substantial questions of law framed for admission were left open. The Revenue was granted liberty to seek restoration of the appeals if the tax effect exceeded the threshold limit. No costs were imposed.
The High Court did not decide the substantial questions of law. The Court noted the enactment of the Direct Tax Vivad Se Vishwas Act, 2020, and the assessee's participation in the scheme. The learned counsel for the respondent/assessee submitted that the assessee had availed the Vivad Se Vishwas Scheme and had been issued Form-5 on May 6, 2021. Recording this submission, the High Court held that nothing further survived for adjudication in the appeal. Therefore, the Tax Case Appeal was disposed of. The specific findings of the ITAT on the trademark license fee, bank guarantees, and depreciation on temporary structures were not reviewed or affirmed by the High Court. No issue was expressly left undecided, as the appeal was disposed of on procedural grounds.
The High Court held that the substantial question of law involved in the present appeal was covered by a previous judgment of the same court in Commissioner of Income Tax, Chennai Vs. M/s.Ambika Cotton Mills Ltd. ([2021] 279 Taxman 405 (Madras)). In that judgment, the Division Bench had held that proceeds realized on the sale of Certified Emission Reduction Credit, earned from wind energy operations under the Clean Development Mechanism, are capital receipts and not taxable. The High Court also referred to the Andhra Pradesh High Court's decision in Commissioner of Income Tax-IV v. My Home Power Ltd., which confirmed that carbon credits are not an offshoot of business but of environmental concerns, and thus capital receipts. Consequently, the High Court decided the question of law against the Revenue and in favour of the assessee. The appeal was dismissed.
The High Court dismissed the Tax Case Appeals filed by the Revenue as withdrawn. The dismissal was based on the Revenue's submission that the appeals were not being pursued due to a low tax effect, as per CBDT Circular No.17/2019. The Court noted that the monetary limit for filing appeals before the High Court had been increased to Rs.1 crore by this circular, and the tax effect in the present cases was below this limit. Consequently, the appeals were disposed of without a decision on the merits of the substantial question of law. The substantial question of law framed was expressly left open. Liberty was granted to the Revenue to seek restoration of the appeals if the tax effect was found to be above the threshold limit, to be heard and decided on merits. No costs were awarded.
The High Court dismissed the Tax Case Appeal filed by the Revenue. The dismissal was based on a submission by the learned Standing Counsel for the Revenue that the tax effect in the instant case was less than the monetary limit imposed by CBDT's Circular No.9 of 2024 dated 17.09.2024. Consequently, the appeal was disposed of without adjudicating the substantial questions of law raised. The Court explicitly kept the substantial questions of law open for adjudication at an appropriate stage in the future. Therefore, there was no finding on the merits of the issues concerning the deduction under Section 80IA or the applicability of Section 80AB, nor was there any operative direction like deletion or granting of relief. The principle that can be cited from this judgment is that appeals with low tax effect, as per CBDT circulars, may be dismissed without deciding the merits, preserving the questions of law.
The High Court dismissed the appeal as withdrawn on account of low tax effect, as submitted by the Revenue. The court noted that the Revenue cited CBDT Circular No.17/2019, which increased the monetary limit for appeals to the High Court to Rs.1 crore, and stated that the tax effect in this case was below this threshold. The substantial questions of law framed at the time of admission were expressly left open. The Revenue was granted liberty to mention the case for restoration if the tax effect was found to be above the threshold limit fixed in the circular, to be heard and decided on merits. No costs were awarded.
The High Court dismissed the appeal as withdrawn on account of low tax effect, in light of the submissions made by the Revenue's counsel. The court noted that the CBDT Circular No. 17/2019 increased the monetary limit for filing or pursuing an appeal before the High Court to Rs. 1 crore, and the tax effect in this case was less than this limit. The substantial questions of law framed were left open. Liberty was granted to the Revenue to mention the case before the court to restore the appeal for hearing and decision on merits if the tax effect is found to be above the threshold limit fixed in the Circular. No costs were awarded.
The High Court dismissed the appeal as withdrawn on account of low tax effect, citing Circular No. 17/2019 of the Central Board of Direct Taxes, which increased the monetary limit for filing appeals before the High Court to Rs. 1 crore. The Court noted that the tax effect in this case was below this threshold. Consequently, the appeal was not decided on its merits. The substantial question of law framed by the Court was left open. Liberty was granted to the Revenue to seek restoration of the appeal if the tax effect was found to be above the fixed threshold, for a decision on merits. No costs were awarded.
The High Court dismissed the appeal as withdrawn on account of low tax effect, in line with CBDT Circular No. 17/2019. The Court noted that the Revenue's submission regarding the low tax effect was accepted. The substantial questions of law framed at the time of admission were expressly left open. The Revenue was granted liberty to mention the case for restoration if the tax effect was found to be above the threshold limit fixed in the circular. No costs were awarded. The judgment does not provide a decision on the merits of the substantial questions of law.
The High Court decided the substantial question of law against the Revenue and in favour of the assessee. The Court followed the ratio laid down in its own previous judgment dated 29.06.2021 in T.C.A. Nos.355 to 358 of 2011 (Commissioner of Income Tax-I, Chennai. v. M/s. L & T Transportation Infrastructure Ltd., Chennai). This previous judgment, in turn, relied on the Supreme Court's decision in Principal Commissioner of Income Tax Vs. GVK Jaipur Expressway Ltd. The Supreme Court held that the term 'owned' in Section 32(1) of the Income Tax Act, 1961, must be assigned a wider meaning. It includes anyone in possession of property in their own title, exercising dominion over it, and having the right to use and occupy it, even without a formal deed of title. Depreciation is an allowance for the diminution in value due to wear and tear of a capital asset employed in business. The legislative intent of Section 32 is best fulfilled by allowing depreciation to the person who has dominion over the building and is entitled to use it in their own right for business purposes. The Court found that the assessee, having paid part of the price, was placed in possession and used the asset for its business, thus qualifying for depreciation.