Commissioner Of Income Tax,Chennai v. M/S.r.k.investments

In the High Court of Judicature at Madras Dated : 27.08.2019 Coram : The Honourable Mr.Justice T.S.SIVAGNANAMandThe Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal No.66 of 2015 Commissioner of Income Tax,Chennai. ...Appellant/Appellant Vs M/s.R.K.Investments,28/21, De Monte Colony,Alwarpet, chennai - 18....Respondent/Respondent APPEAL under Section 260A of the Income Tax Act, 1961 againstthe order dated 27.02.2014 made in ITA.No.1907/MDS/2010 on thefile of the Income Tax Appellate Tribunal, Chennai 'C' Bench forthe assessment year 2005-06, against the order passed by the Commissioner of Income Tax(Appeals) XII, Chennai-34 made in ITA No.492/ 07-08 dated31/08/2010 and against the order passed by the Assistantcommissioner of Income Tax, Tax Circle XV, Chennai, made in GIRNo./P.A.No.AAAFR3413Q dated 31.12.2007. For Appellant: Mr.M.Swaminathan, SSC and Ms.V.Pushpa, SCFor Respondent: Mr.R.Venkatanarayanan for M/s.Subbaraya Aiyar Padmanabhan JUDGMENT(Judgment was delivered by T.S.Sivagnanam,J.) We have heard Mr.M.Swaminathan, learned Senior StandingCounsel, and Ms.V.Pushpa, learned Standing Counsel appearing forthe appellant/revenue and Mr.R.Venkatanarayanan, learned counselfor M/s.Subbaraya Aiyar Padmanabhan, learned counsel appearingfor the respondent/assessee. https://hcservices.ecourts.gov.in/hcservices/ 2.This appeal, filed by the Revenue under Section 260A ofthe Income Tax Act, 1961 is directed against the order dated27.02.2014 made in ITA.No.1907/MDS/2010 on the file of theIncome Tax Appellate Tribunal, Chennai 'C' Bench for theassessment year 2005-06. 3.The appeal was admitted on 25.02.2015 on the followingsubstantial questions of law :“1.Whether, on the facts and in thecircumstances of the case, the Tribunal was rightin holding that the interest paid on the borrowingsduring the earlier years is allowable as deductionfrom the income earned from purchase and sale ofthe asset during the year?2.Whether in the facts and circumstances of thecase, the Tribunal was right in holding thatinterest paid on the borrowings during the earlieryears is allowable as deduction from the incomeearned from purchase and sale of the asset duringthe year when the assessee had not proved that theloan borrowed was actually utilised for thepurchase of the asset?" 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. //True Copy// To 1.The Income Tax Appellate Tribunal, Chennai 'C' Bench. Chennai 'C' Bench. 2.The Commissioner of Income Tax, (Appeals)-XII, Chennai-34. 3.The Assistant Commissioner of Income Tax, Tax Circle XV, Chennai-34. Tax Circle XV, Chennai-34. +1cc to M/s.Subbaraya Aiyar, Advocate Sr.73644+1cc to Mr.M.Swaminathan, Advocate Sr.73562 BS(CO)srg 01/11/2019 TCA.No.66 of 2015