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The High Court noted the submission of the appellant's counsel that the assessee had availed the benefit of the Direct Tax Vivad Se Vishwas Act, 2020, and remitted the tax due. The appellant provided Form 3 dated 07.01.2021 and proof of payment. Based on these submissions and documents, the learned counsel for the appellant sought permission to withdraw the appeal. The Court, recording these submissions, dismissed the tax case appeal as withdrawn. No specific findings were given on the substantial questions of law as the appeal was withdrawn. The operative direction was to dismiss the appeal as withdrawn.
The High Court did not decide the substantial questions of law on merits. The learned counsel for the appellant/Revenue brought to the court's notice CBDT Circular No. 17/2019 dated 08.08.2019, which stipulates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs. 1,00,00,000/-. It was submitted that the tax effect in the present appeal was less than this threshold limit. In light of this submission, the High Court dismissed the appeal as withdrawn, stating that the substantial questions of law were kept open for determination in an appropriate case. No costs were awarded.
The High Court dismissed the appeal as withdrawn. This decision was based on a submission by the Revenue's counsel regarding CBDT Circular No. 17/2019. This circular stipulates that the Department shall not file or pursue appeals before the High Court if the tax effect does not exceed Rs. 1,00,00,000/-. The Revenue's counsel submitted that the tax effect in this particular appeal was below this threshold limit. Consequently, the Court dismissed the appeal as withdrawn, explicitly stating that the substantial questions of law were kept open for determination in an appropriate case. No costs were awarded. The judgment does not provide findings on the merits of the substantial questions of law.
The High Court noted that subsequent to the ITAT's order dated March 23, 2017, which remanded the penalty issue for fresh examination, the Assessing Officer (AO) re-examined the penalty issue and confirmed it. This confirmation was subsequently affirmed by the CIT(Appeals). The assessees have filed second round appeals before the ITAT (ITA Nos. 2691 to 2698/Chny/2018). Given this subsequent development, the revenue submitted that nothing survives for adjudication in the present tax case appeals. The learned counsel for the appellant fairly conceded to this submission. The Court observed that one of the appellants, Shri Durga Das Vyas, is no more. In view of the subsequent developments rendering the appeals infructuous, the High Court dismissed the tax case appeals. The substantial questions of law were left open for consideration in appropriate cases. The appellants/Legal heirs were granted liberty to file appropriate applications and raise all contentions, including the limitation issue, in the proceedings pending before the ITAT.
The High Court of Judicature at Madras dismissed the appeals as withdrawn. The Revenue's counsel brought to the court's notice Circular No. 17/2019 dated 08.08.2019 issued by the Central Board of Direct Taxes (CBDT), which stipulates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs. 1,00,00,000/- (Rupees One Crore). The counsel submitted that the tax effect in these appeals was less than this threshold limit. Consequently, the court dismissed the present appeals, stating that the substantial questions of law were kept open for determination in appropriate cases. No costs were awarded.
The High Court did not decide the substantial questions of law on their merits. Instead, the Revenue's counsel brought to the court's notice CBDT Circular No. 17/2019, which mandates that appeals shall not be filed or pursued if the tax effect does not exceed Rs. 1,00,00,000/-. The counsel submitted that the tax effect in the present appeal was less than this threshold limit. Consequently, the High Court, in light of this submission and the circular, dismissed the appeal as withdrawn. The court explicitly stated that the substantial questions of law were kept open for determination in an appropriate case. No costs were awarded.
The High Court noted the submission by the Revenue's counsel regarding CBDT Circular No. 17/2019, which mandates that appeals shall not be filed or pursued if the tax effect does not exceed Rs. 1,00,00,000/-. The Revenue confirmed that the tax effect in this particular appeal was below the stipulated monetary limit. Consequently, the High Court dismissed the appeal as withdrawn, stating that the substantial question of law remains open for determination in an appropriate case. No costs were awarded. The specific finding of the ITAT on the taxability of interest as business income was not adjudicated upon by the High Court due to the withdrawal of the appeal.
The High Court held that the substantial question of law is answered in favour of the assessee and against the Revenue. The court noted that the Revenue's counsel fairly conceded that the issue was covered against the Revenue by this court's decision in Director of Income Tax Exemptions v. Seervi Samaj Tambaram Trust. This decision, in turn, referred to earlier decisions of the same court. The reasoning adopted was that Section 12AA of the Income Tax Act does not stipulate that a trust cannot have both religious and charitable objects. The Commissioner's satisfaction is primarily about the genuineness of the objects and activities. The judgment cited the Gujarat High Court's decision in CIT Vs. Kutchi Dasa Oswal Moto Pariwar Ambama Trust, which was respectfully agreed with. The court found no reason to refuse registration merely because the trust had not commenced its activities at the time of application, especially when the genuineness of the objects was not doubted and the power to cancel registration for non-compliance exists under Section 12AA(3). Therefore, the Tax Case Appeal filed by the Revenue was dismissed.
The High Court noted that the Income-tax Act is a self-contained Act and that the court, under Section 260A, is not the proper forum for deciding mixed questions of law and fact. Therefore, the court decided to remand the matter to the Assessing Officer, similar to the direction given by the Tribunal. However, the High Court specifically directed the Assessing Officer to consider all the issues raised by the appellant without being influenced by any of the observations made by the Tribunal. The Assessing Officer was also directed to provide a reasonable opportunity to the appellant and complete the exercise within three months of receiving the judgment. The court did not decide the substantial questions of law on merits but remitted them for fresh consideration.
The High Court noted that the assessee had availed the benefits conferred under the Direct Tax Vivad Se Vishwas Act, 2020, a beneficial legislation for the resolution of disputed tax matters. The declarations submitted by the assessee were accepted, and Form 3 was issued by the Income Tax Department. In light of this development, the Court found it unnecessary to decide the substantial question of law that arose in the tax case appeal. The appeal was disposed of based on the submissions made by both parties. The Court directed the department to process the application at the earliest in accordance with the Act and communicate the decision to the assessee promptly. No costs were awarded.
The High Court held that the issues involved were primarily questions of fact and did not involve any substantial question of law warranting interference. The Tribunal, being the final fact-finding authority, had dismissed the assessee's appeal. The court referred to the Supreme Court's decision in Metroark Ltd. v. CCE, emphasizing that interference is not warranted unless the Tribunal's finding is perverse. Regarding the specific issues: 1. & 2. Cash deposits of Rs. 46,50,000/- and Rs. 12,50,000/-: The Tribunal found no satisfactory explanation for these deposits. For the Rs. 46,50,000/- deposit, the Tribunal noted inconsistencies regarding the return of cash by Shri S.K. Pandian and considered the confirmation letter an afterthought. For the Rs. 12,50,000/- deposit, the Tribunal found contradictions in statements, lack of evidence for repayment, and failure to establish the identity, creditworthiness, and genuineness of the transaction with Shri R. Nagarajan. 3. Cash deposit of Rs. 6,00,000/-: The Tribunal confirmed the addition, stating the assessee failed to establish the identity, creditworthiness of Shri D. Palanisamy, and the genuineness of the transaction. 4. Perverse finding: The court did not find the Tribunal's finding to be perverse, as it was based on the evidence and submissions considered. 5. Denial of exemption under Section 54F: The Tribunal upheld the disallowance, noting that the assessee's wife, an independent assessee, had already claimed exemption under Section 54F for the same property, making a second claim by the assessee impermissible. 6. Remand: The court did not find it appropriate to remand the issue, as it considered the matters to be factual and already adjudicated by the Tribunal. The operative direction was that the tax case appeal fails and is dismissed.
The High Court dismissed the appeals filed by the Revenue. For substantial questions of law Nos. 1 to 3 concerning the replacement of machinery, the Court noted that a Co-ordinate Bench had already decided these issues against the Revenue in T.C.A. Nos. 173 & 174 of 2009, dated 09.01.2014. The Court referred to the principles laid down in CIT vs. Saravana Spinning Mills P. Ltd. and CIT vs. Sri Mangayarkarasi Mills P. Limited, emphasizing that the test for deductibility under Section 31(i) is whether the expenditure is for 'current repairs' to preserve and maintain an existing asset, not to bring a new asset into existence or obtain a new advantage. The Court also referred to CIT vs. Mahalakshmi Textile Mills Ltd., stating that if replaced parts perform the same function without changing the machinery's performance, it constitutes current repairs. For substantial question of law No. 4 regarding Section 80HHC, the Court found no merit in the Revenue's appeal, agreeing with the Tribunal's view that excise duty and sales tax do not form part of the 'turnover' for the purpose of Section 80HHC calculation, as they are indirect taxes collected on behalf of the government and do not emanate from the turnover itself, making the formula unworkable if included. For substantial question of law No. 5 concerning voluntary retirement scheme payments, the Court relied on the decision in CIT vs. Simpson & Co. Ltd. [(1998) 230 ITR 703 (Madras)], which held that such expenditure is for business expediency and maintaining good labour relations, and thus deductible. The Court answered all substantial questions of law against the Revenue and in favour of the assessee.
The High Court did not decide the substantial questions of law on merits. The Revenue brought to the court's notice Circular No. 17/2019 issued by the CBDT, which stipulates that appeals should not be filed or pursued if the tax effect does not exceed Rs. 1,00,00,000/-. The Revenue submitted that the tax effect in this appeal was below the threshold limit. Consequently, the High Court dismissed the appeal as withdrawn, stating that the substantial questions of law were kept open for determination in an appropriate case. No costs were awarded.
The High Court noted that the assessee had availed the benefit of the Direct Tax Vivad Se Vishwas Act, 2020, and had obtained a full and final settlement order for tax arrears on 07.05.2021. This subsequent development was fairly conceded by the Revenue. In view of this, the Court was of the opinion that nothing survived for adjudication in the appeal. Consequently, the Tax Case Appeal was disposed of based on the submissions made by both parties. The specific questions of law regarding the classification of royalty payments as revenue or capital expenditure and their treatment as intangible assets under Section 32(1)(ii) were not decided on merits.
The High Court held that the substantial questions of law were covered against the Revenue by a co-ordinate bench's decision in Principal Commissioner of Income – tax-3, Coimbatore v. Prabhu Spinning Mills (P) Limited. This decision followed the High Court's earlier ruling in M/s. Velayudhasamy Spinning Mills (P) Ltd. v. Asst.CIT. The Court also referred to Circular No.1/2016 issued by the Central Board of Direct Taxes (CBDT), which clarified that the 'initial assessment year' under Section 80IA(5) means the first year opted for by the assessee for claiming deduction, not necessarily the year of commencement of business. The circular directed Assessing Officers to allow deduction based on the assessee's option for the initial year, provided other conditions are met. Consequently, the High Court found that the second and third questions of law were covered by the circular and the previous judgment. The appeal was dismissed, answering the substantial questions of law against the Revenue and in favour of the assessee. No specific finding was recorded on the first question as the matter was covered by precedent.
The High Court noted that the Revenue itself brought to its notice CBDT Circular No. 17/2019, which mandates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs. 1,00,00,000/-. The Revenue further submitted that the tax effect in the present appeal was below this threshold. In light of this submission by the appellant/Revenue, the High Court dismissed the appeal as withdrawn. The Court explicitly stated that the substantial questions of law were left open for determination in an appropriate case. No costs were awarded.
The High Court, in its common judgment, addressed the substantial questions of law. For TCA No. 24 of 2022, the Revenue's counsel fairly conceded that the questions should be decided in favor of the assessee, citing the Supreme Court judgment in Commissioner of Income Tax v. HCL Technologies Ltd. The Court noted that Section 10A is a beneficial provision and the definition of 'total turnover' for Section 10A should not be imported from other sections like 80HHC or 80HHE. The Court emphasized that the deduction under Section 10A should be computed based on the turnover of the eligible undertaking and not by reducing expenses from the total amount. For TCA Nos. 26 and 28 of 2022, the Court referred to the Supreme Court decision in Commissioner of Income-tax v. Yokogawa India Ltd. The Court held that deductions under Section 10A and 10B are to be made while computing the gross total income of the eligible undertaking under Chapter IV of the Act, and not at the stage of computing the total income under Chapter VI. The Court found that the Revenue's method of first setting off unabsorbed depreciation against total income, thereby reducing the income to Nil and preventing the claim of Section 10B deduction, was contrary to the law declared by the Supreme Court. Consequently, the Court held that the ITAT's decision was legally sound. The appeals were disposed of in favor of the assessee.
The High Court did not decide the substantial questions of law on their merits. Instead, the Revenue brought to the court's attention CBDT Circular No. 17/2019, which mandates that appeals should not be filed or pursued before the High Court if the tax effect is less than Rs. 1,00,00,000/-. The Revenue submitted that the tax effect in the present appeal was below this threshold limit. Consequently, the High Court, in light of this submission and the circular, dismissed the appeal as withdrawn. The court explicitly stated that the substantial questions of law were kept open for determination in an appropriate case. No costs were awarded.
The High Court did not decide the substantial questions of law on merits. The learned counsel for the Revenue brought to the court's notice CBDT Circular No. 17/2019 dated 08.08.2019, which stipulates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs. 1,00,00,000/-. It was submitted that the tax effect in these appeals was less than this threshold limit. Consequently, the High Court dismissed the appeals as withdrawn, keeping open the substantial questions of law for determination in appropriate cases. No costs were awarded, and the connected miscellaneous petition was closed.
The High Court of Judicature at Madras dismissed the appeals filed by the Revenue as withdrawn. The Court noted that the learned counsel for the Revenue brought to its notice Circular No.17/2019 dated 08.08.2019 issued by the Central Board of Direct Taxes (CBDT). This circular stipulates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs.1,00,00,000/- (Rupees One Crore). The Revenue submitted that the tax effect in these appeals was less than this threshold limit. Consequently, in light of the submission regarding the tax effect being below the monetary limit, the appeals were dismissed as withdrawn. The Court explicitly stated that the substantial questions of law were kept open for determination in appropriate cases. No costs were awarded, and the connected miscellaneous petition was closed.
The High Court noted the submission made by the learned counsel for the appellant/Revenue regarding Circular No.17/2019 dated 08.08.2019. This circular stipulates that appeals shall not be filed or pursued by the Department before the High Court where the tax effect does not exceed Rs.1,00,00,000/-. The Revenue submitted that the tax effect in the present appeals was less than this stipulated threshold limit. In light of this submission, the Court found that the appeal, wherein the tax effect was less than the monetary limit, was to be dismissed as withdrawn. The Court explicitly stated that the substantial question of law was kept open for determination in an appropriate case. No costs were awarded.
The High Court held that the substantial question of law is decided in favour of the assessee. The Court relied on the Supreme Court's judgment in Deputy Commissioner of Income-tax v. Pepsi Foods Ltd. The Supreme Court had ruled that the third proviso to Section 254(2A) of the Income-tax Act, which stipulated automatic vacation of stay after 365 days irrespective of the cause of delay, was arbitrary and discriminatory, violating Article 14 of the Constitution. The Supreme Court held that any order of stay shall stand vacated after the expiry of the period mentioned in Section 254(2A) only if the delay in disposing of the appeal is attributable to the assessee. Applying this principle, the High Court found that the delay in disposing of the appeal was not attributable to the assessee. Therefore, the Tax Case Appeal filed by the Revenue was dismissed.
The High Court dismissed the appeals as withdrawn. The Revenue's counsel brought to the court's notice CBDT Circular No. 17/2019 dated 08.08.2019, which stipulates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs. 1,00,00,000/- (Rupees One Crore). The counsel submitted that the tax effect in these appeals was less than the threshold limit. In light of this submission, the Court dismissed the present appeals, finding that the tax effect was below the monetary limit. The substantial questions of law were kept open for determination in appropriate cases. No costs were awarded.
The High Court, upon recording the submission made by the learned counsel for the appellant, granted permission to withdraw the Tax Case Appeal. Consequently, the appeal was dismissed as withdrawn. No costs were awarded. The Court did not delve into the merits of the case as the appeal was withdrawn by the appellant.
The High Court recorded that the learned counsel for the appellant sought permission to withdraw the Tax Case Appeal as the appellant was not pressing it. Consequently, the Court dismissed the appeal as not pressed. No costs were awarded. The connected civil miscellaneous petition was also closed. The specific grounds or merits of the original appeal before the ITAT were not discussed or decided by the High Court.
The High Court noted that during the pendency of the appeals, the assessee had availed the benefit conferred under the Direct Tax Vivad Se Vishwas Act, 2020. The assessee filed necessary declarations, which were accepted, and Form 3 was issued by the Income Tax Department on 23.04.2021. This submission was fairly conceded by the learned senior standing counsel for the Revenue. In view of this development, the Court found it unnecessary to decide the substantial questions of law raised in the appeals. The Court recorded the submissions and disposed of the appeals, directing the department to process the application under the Vivad Se Vishwas Act in accordance with the law and communicate the decision to the assessee at the earliest. No costs were awarded. The connected civil miscellaneous petitions were also closed.
The High Court held that the sale of Carbon Emission Reduction (CER) or Carbon Credits is to be considered a capital receipt and not liable to tax. The Court followed its own decision in S.P. Spinning Mills (P) Ltd. v. Assistant Commissioner of Income Tax, which in turn relied on decisions from the Karnataka High Court (CIT vs. Subhash Kabini Power Corporation Ltd.) and the Andhra Pradesh High Court (CIT vs. My Home Power Ltd.). The Court noted that the Apex Court had also considered similar issues regarding the nature of receipts from the sale of 'loom-hours' in cases like Commissioner of Income Tax v. Maheshwari Devi Jute Mills Ltd. and M/s. Empire Jute Co. Ltd. v. Commissioner of Income Tax, treating them as capital receipts. The Court found that the Tribunal had failed to exercise its power properly by not applying the settled law that receipts from carbon credits are capital in nature. The Court concluded that the question of deduction under Section 80IA of the Act became a non-issue if the receipt was capital in nature, as it would fall outside the ambit of gross total income. The substantial question of law was answered in favour of the assessee. The appeal was dismissed.
The High Court did not decide the substantial questions of law on merits. The learned counsel for the appellant/Revenue brought to the court's notice CBDT Circular No. 17/2019 dated 08.08.2019, which stipulates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs.1,00,00,000/-. It was submitted that the tax effect in these appeals was less than this threshold limit. Consequently, the High Court dismissed the present appeals as withdrawn, in light of the submission regarding the tax effect being below the monetary limit. The substantial questions of law were kept open for determination in appropriate cases. No costs were awarded.
The High Court held that the substantial questions of law raised in the appeal were covered by the decision of the Supreme Court in Commissioner of Income-tax v. Yokogawa India Ltd. The Supreme Court had clarified that Section 10A, as amended, is a provision for deduction, and the stage of deduction is while computing the gross total income of the eligible undertaking under Chapter IV of the Act, not at the stage of computation of the total income under Chapter VI. The court found that the method adopted by the Revenue, which involved setting off brought forward or carry forward depreciation and unabsorbed depreciation before calculating the Section 10A deduction, was contrary to the law declared by the Supreme Court. Consequently, the High Court held that the ITAT's decision could not stand legal scrutiny. The appeal was allowed, and the substantial questions of law were answered in favour of the assessee and against the Revenue. No order as to costs was made.
The High Court did not decide the substantial questions of law on merits. The learned counsel for the appellant/Revenue brought to the court's notice CBDT Circular No. 17/2019 dated 08.08.2019, which stipulates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs. 1,00,00,000/-. It was submitted that the tax effect in this appeal was less than the threshold limit. Consequently, the High Court dismissed the present appeal as withdrawn, stating that the substantial questions of law are kept open for determination in an appropriate case. No costs were awarded.
The High Court did not decide the substantial questions of law on their merits. Instead, the learned counsel for the appellant/Revenue brought to the court's notice CBDT Circular No. 17/2019 dated August 8, 2019. This circular stipulates that appeals shall not be filed or pursued by the Department before the High Court if the tax effect does not exceed Rs. 1,00,00,000/-. The Revenue submitted that the tax effect in these appeals was less than this threshold limit. Consequently, the High Court dismissed the present appeals as withdrawn, based on the submission regarding the tax effect being below the monetary limit. The substantial questions of law were kept open for determination in appropriate cases. No costs were awarded.