Commissioner Of Income Tax-I, Tiruchirapalli v. M/S.metro Fabrics, Karur44

In the High Court of Judicature at Madras The Honourable Mr.Justice T.S.SIVAGNANAM and The Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal No.1171 of 2010 Commissioner of Income Tax-I, Tiruchirapalli...Appellant Vs M/s.Metro Fabrics, Karur44 & 46, Fifty Feet Road,Ramakirhnapuram North, Karur...Respondent APPEAL under Section 260A of the Income Tax Act, 1961 againstthe order dated 21.5.2010 made in ITA.No.694/Mds/2007 on thefile of the Income Tax Appellate Tribunal, Chennai 'C' Bench forthe assessment year 2003-04 against the order dated 17/11/2006made in ITA No.73/06-07 on the file of the Commissioner ofIncome Tax (Appeals) Tiruchirappalli, against the order of theDeputy Commissioner of Income Tax, Circle II, Tiruchirappallidated 17/03/2006 in PAN/GIR No. /20-FM-12. For Appellant: Mr.M.Swaminathan, SSC, assisted byMs.V.Pushpa, SCFor Respondent:Mr.Ponnaiyan Judgment was delivered by T.S.Sivagnanam,J We have heard Mr.M.Swaminathan, learned Senior StandingCounsel, assisted by Ms.V.Pushpa, learned Standing Counselappearing for the appellant – Revenue and Mr.Ponnaiyan, learnedcounsel appearing for the respondent – assessee. 2. This appeal, filed by the Revenue under Section 260A ofthe Income Tax Act, 1961 is directed against the order dated21.5.2010 made in ITA.No. 694/Mds/2007 on the file of the IncomeTax Appellate Tribunal, Chennai 'C' Bench for the assessmentyear 2003-04. https://hcservices.ecourts.gov.in/hcservices/ 3. The appeal was admitted on 10.1.2011 on the followingsubstantial questions of law : “i. Whether, on the facts andcircumstances 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 appeal is 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 this case is lessthan the threshold limit. 5. In the light of the said submissions, the above tax caseappeal is dismissed on account of the low tax effect. Thesubstantial questions of law framed are left open. In the eventthe tax effect is above the threshold limit fixed in the saidcircular, liberty is granted to the Revenue to make a mention tothis Court to restore the appeal to be heard and decided onmerits. No costs. Sd/-Assistant Registrar //True copy// Sub Assistant Registrar RS https://hcservices.ecourts.gov.in/hcservices/ To 1. The Income Tax Appellate Tribunal, Chennai 'C' Bench. 2. The O/o. Commissioner of Income Tax, (Appeals), 4, William Road, Cantonemtn, Tiruchirappalli 620 001. 3. The Deputy Commissioner of Income Tax, Circle-II, No.10, William Road, Tiruchirappalli. Circle-II, No.10, William Road, Tiruchirappalli. +1cc to Mr.M.Swaminathan, Advocate SR.No.70418 TCA.No.1171 of 2010 NRL(CO)GMY(15/10/2019)