Commissioner Of Income Tax I, Chennai v. M/S.baer Shoes (India) Pvt. Ltd., Chennai-7

IN THE HIGH COURT OF JUDICATURE AT MADRAS Dated : 19.8.2019 Coram : The Honourable Mr.Justice T.S.SIVAGNANAMandThe Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal Nos.713 & 714 of 2010 Commissioner of Income Tax I,Chennai...Appellant /Respondentin Both TCAs.VsM/s.Baer Shoes (India) Pvt.Ltd., Chennai-7...Respondent/Appellantin Both TCAs. Common Prayer in TCA.Nos.713 & 714 of 2010 : APPEALS under Section 260A of the Income Tax Act, 1961against the common order dated 26.11.2009 made in ITA.Nos.1210and 1211/Mds/2008 on the file of the Income Tax AppellateTribunal, Chennai 'A' Bench for the assessment years 2003-04 and2004-05. ITA.Nos.1210/Mds/2008 against the Commissioner of Income TaxAppeals(III), 121, Mahatma Gandhi Road, Chennai -34 inPAN.No. AAACB3603R for the Assessment Year 2003-2004 inITA.Nos.307/2006-07/A-III, dated 29/02/2008 against the IncomeTax Officer, Company Ward I(1), Chennai -34 in G.I.No./PANAAACB3603R/BX3-028 for the Assessment Year 2003-04 order dated31/03/2006. ITA.Nos.1211/Mds/2008 against the Commissioner of Income TaxAppeals(III), 121, Mahatma Gandhi Road, Chennai -34 inPAN.No. AAACB3603R for the Assessment Year 2004-2005 inITA.Nos.965/2006-07/A-III, dated 29/02/2008 against the IncomeTaxOfficer,CompanyWardI(1),Chennai-34inG.I.No./PAN. /BX3-028 for the Assessment Year 2004-05order dated 31/03/2006.For Appellant:Mrs.R.Hemalatha, SSC For Respondent:Mr.A.S.Sriraman https://hcservices.ecourts.gov.in/hcservices/ COMMON JUDGMENT(Judgment was delivered by T.S.Sivagnanam,J) We have heard Mrs.R.Hemalatha, learned Senior StandingCounsel appearing for the appellant – Revenue andMr.A.S.Sriraman, learned counsel appearing for the respondent –assessee. 2. These appeals, filed by the Revenue under Section 260A ofthe Income Tax Act, 1961, are directed against the common orderdated 26.11.2009 made in ITA.Nos.1210 and 1211/Mds/2008 on thefile of the Income Tax Appellate Tribunal, Chennai 'A' Bench forthe assessment years 2003-04 and 2004-05. 3. The appeals were admitted on 26.7.2010 on the followingsubstantial questions of law : “i. Whether, on the facts and in thecircumstances of the case, the Income TaxAppellate Tribunal was right in holding thatthe face value of DEPB is chargeable to taxon accrual basis and that the profit on saleof DEPB representing the excess of saleproceeds of DEPB over its face value isliable to be considered under Section 28(iiid) at the time of its sale? Andii. Whether, on the facts and in thecircumstances of the case, the Income TaxAppellate Tribunal was right in not holdingthat the scheme of DEPB is not an automaticbenefit to an exporter in the form of cashassistance, but arises only on makingapplication to the concerned Authoritypursuant to exports and is in the nature of'benefit of perquisite arising out ofbusiness' and therefore, is chargeable totax under Section 28(iv)?” 4. The learned Senior Standing Counsel for the appellantsubmits that the above appeals are not pursued by the Revenue onaccount of the low tax effect in terms of Circular No.17/2019dated 08.8.2019 issued by the Central Board of Direct Taxes. Bythe said Circular, the monetary limit for filing or pursuing anappeal before the High Court has been increased to Rs.1 Crore.It is further submitted that the tax effect in the respectivecases is less than the threshold limit. 5. In the light of the said submissions, the above tax caseappeals are dismissed on account of the low tax effect. Thesubstantial questions of law framed are left open. In the event https://hcservices.ecourts.gov.in/hcservices/ the tax effect in the respective cases is above the thresholdlimit fixed in the said circular, liberty is granted to theRevenue to make a mention to this Court to restore the appealsto be heard and decided on merits. No costs. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar To 5. In the light of the said submissions, the above tax caseappeals are dismissed on account of the low tax effect. Thesubstantial questions of law framed are left open. In the event https://hcservices.ecourts.gov.in/hcservices/ the tax effect in the respective cases is above the thresholdlimit fixed in the said circular, liberty is granted to theRevenue to make a mention to this Court to restore the appealsto be heard and decided on merits. No costs. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar To 1.The Income Tax Appellate Tribunal, Chennai 'A' Bench. 2.The Commissioner of Income Tax (Appeals)III,Chennai -34. 3.The Income Tax Officer, Company Ward I(1),Chennai -34. +1 cc to M/s.S.Sridhar,Advocate Sr.No. 70088+1 cc to Mr.T.Ravi Kumar, Advocate Sr.No.70063 AKM/16.10.19/3P- 6C / TCA.Nos.713 & 714 of 2010