Commissioner Of Income Tax-Ltu,Chennai v. M/S.wheels India Ltd.,Padi, Chennai - 600 050

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 04.12.2018 CORAM : THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMandTHE HONOURABLE MR.JUSTICE N.SATHISH KUMARTax Case (Appeal) No.266 of 2011 Commissioner of Income Tax-LTU,Chennai. ...Appellant/Appellant -vs- M/s.Wheels India Ltd.,Padi, Chennai - 600 050. ...Respondent/Appellant Tax Case (Appeal) filed under Section 260-A of the IncomeTax Act, 1961 against the order of the Income-tax AppellateTribunal, “A” Bench, Chennai, dated 16.12.2010, passed inI.T.A.No.250/Mds/2010 for the assessment year 2005-06 againstthe order of The Commissioner of Tax (Appeals) LTU, Chennai,dated 30.11.2009 passed in ITA No.478/07-08/LTU(A) for theAssessment Year 2005-2006 against the order of the AdditionalCommissioner of Income Tax Company Range III, Chennai - 34,dated 14.12.2007 in GIR No/PAN:AAACNO315K(33001-W) for theassessment year 2005-06. For Appellant :M/s.R.HemalathaFor Respondent:Mr.R.Venkatanarayananfor M/s.Subaraya AiyarPadmanabhan JUDGMENT (Judgment was delivered by T.S.Sivagnanam, J.) This appeal by the appellant/Revenue is directed againstthe order of the Income-tax Appellate Tribunal, “A” Bench,Chennai, dated 16.12.2010, passed in I.T.A.No.250/Mds/2010 forthe assessment year 2005-06. 2.Heard M/s.R.Hemalatha, learned counsel for theappellant/Revenue and Mr.R.Venkatanarayanan, learned counsel forthe respondent/assessee. 3.This Appeal has been admitted on 19.07.2011, on thefollowing substantial question of law:- https://hcservices.ecourts.gov.in/hcservices/ “Whether on the facts and circumstances ofthe case, the Income Tax Appellate Tribunal wasright in holding that the Assessing Officer wasnot jusitifed in disallowing the commission ofRs.1,05,23,000/- to foreign agents for procuringexport orders and rendering managerial servicesunder Section 40(a)(i) of the Income Tax Act,1961 even though no tax was deducted at source?” 4.We have perused the Order of Assessment as well as theOrder passed by the Commissioner of Income Tax and we find thatthe tax effect in this appeal is lesser than the threshold limitmentioned in Circular No.3 of 2018, dated 11.07.2018, issued bythe Central Board of Direct Taxes, which fixes the monetarylimit as Rs.50,00,000/- for the Department to pursue the matter.Furthermore, the Revenue has not been able to point out anydistinguishing features, by which the Circular No.3 of 2018,dated 11.07.2018, cannot be applied. 5.Thus, for the above reasons, the Revenue cannot pursuethis Appeal in view of the low tax effect. Hence, the Appeal isdismissed and the Substantial Question of Law, framed forconsideration, is left open. No costs. The Revenue is atliberty to seek for restoration of appeal if at a later point oftime, it is found that the tax effect is above the thresholdlimit or to fall under the exceptional clauses mentioned in theCircular. cse Sd/- Assistant Registrar(CS III) //True Copy// Sub Assistant Registrar To1. The Income-tax Appellate Tribunal, “A” Bench, Chennai. 2. The Commissioner of Income Tax - LTU, Chennai. 3. The Additional Commissioner of Income Tax Company Range-III, Chennai - 34. +1cc to Mr.Subbaraya Aiyar Padamanaban, Advocate, S.R.No.83873+1cc to Mr.T.Ravikumar, Advocate, S.R.No.83291 Tax Case (Appeal) No.266 of 2011 VBA(CO)KAK(03/01/2019)