Commissioner Of Income Tax v. M/S.sreepathy Paper & Boards Pvt. Ltd

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 27.08.2019 CORAM : The Honourable Mr.Justice T.S.SIVAGNANAMandThe Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal No.839 of 2015 Commissioner of Income Tax,No.63, Race Course Road,Coimbatore....Appellant/ Appellant Vs M/s.Sreepathy Paper & Boards Pvt. Ltd.,1680/31, Ramani Regency,Trichy Road, Ramanathapuram, Coimbatore.PAN: ...Respondent/ Respondent APPEAL under Section 260A of the Income Tax Act, 1961 againstthe order dated 04.03.2015 made in ITA.No.2136/MDS/2014 on thefile of the Income Tax Appellate Tribunal, Chennai 'C' Bench forthe assessment year 2010-11 against the order dated 06.05.2014made in Appeal No.002/13-14 on the file of the Commissioner ofIncome Tax Appeals I,Coimbatore against the order dated01.03.2013 Under Section 143(3) of IT ACT 1961 for the AsessmentYear 2010-2011 on the file of the Deputy Commissioner of incometax,Company Circle I(2), Coimbatore. For Appellant: Mr.T.R.Senthilkumar, SSC assisted by Ms.K.G.Usharani For Respondent: No appearance We have heard Mr.T.R.Senthilkumar, learned Senior StandingCounsel, assisted by Ms.K.G.Usharani, learned counsel appearingfor the appellant/revenue. 2.This appeal, filed by the Revenue under Section 260A ofthe Income Tax Act, 1961 is directed against the order dated04.03.2015 made in ITA.No.2136/MDS/2014 on the file of theIncome Tax Appellate Tribunal, Chennai 'C' Bench for theassessment year 2010-11. https://hcservices.ecourts.gov.in/hcservices/ 3.The appeal was admitted on 29.09.2015 on the followingsubstantial questions of law :“(i) Whether on the facts and circumstancesof the case, the Tribunal was right in holdingthat the proceeds realized by the assessee onsale of certified emission reduction credit,which the assessee had earned on the cleandevelopment mechanism in its wind energyoperations, is a capital receipt and nottaxable? (ii) Whether in the facts and circumstancesof the case and in law, the Appellate Tribunalis correct in holding that sale of carbonreceipt and not liable for tax under any head ofincome under the Income Tax Act, 1961? and (ii) Whether in the facts and circumstancesof the case and in law, the Income Tax AppellateTribunal is correct in holding that there is nocost of acquisition or cost of production to getentitlement for the carbon credits, withoutappreciating that generation of carbon creditsis intricately linked to the machinery andprocesses employed in the production process bythe assessee?" 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(CS VIII) //True Copy// Sub Assistant Registrar cse To 1.THE INCOME TAX APPELLATE TRIBUNAL, CHENNAI 'C' BENCH. 2.THE COMMISSIONER OF INCOME TAX APPEALS I,COIMBATORE 3. THE DEPUTY COMMISSIONER OF INCOME TAX,COMPANY CIRCLE I(2),COIMBATORE Copy to: COIMBATORE Copy to: The Section Officer, VR Section, High Court, Chennai. +1cc to Mr.T.R.Senthilkumar , Advocate SR.No. 73602 TCA.No.839 of 2015 A.SK(05/12/2019)