Ita/100/2021 Of Principal Commissioner Of Income Tax 7 v. M/S Vwr Lab Products Pvt Ltd

Digitallysigned by BLAVANYALocation:HIGHCOURT OFKARNATAKA NC: 2024:KHC:39704-DBITA No. 100 of 2021 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 24 DAY OF SEPTEMBER, 2024 PRESENT THE HON'BLE MR JUSTICE S.G.PANDIT AND THE HON'BLE MR JUSTICE C.M. POONACHA INCOME TAX APPEAL NO. 100 OF 2021 BETWEEN: 1. PRINCIPAL COMMISSIONER OF INCOME TAX – 7, BMTC COMPLEX, KORAMANGALA, BENGALURU. BMTC COMPLEX, KORAMANGALA, BENGALURU. 2. THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-7(1)(2), BMTC COMPLEX, KORAMANGALA BENGALURU. CIRCLE-7(1)(2), BMTC COMPLEX, KORAMANGALA BENGALURU. …APPELLANTS (BY SRI SANMATHI E I, ADVOCATE) AND: 1. M/S VWR LAB PRODUCTS PVT LTD., NO.139, BDA INDUSTRIAL SUBURB, 6 MAIN, TUMKUR ROAD, PEENYA POST, BANGALORE - 560 058, PAN NO . …RESPONDENT (BY SMT TANMAYEE RAJKUMAR, ADVOCATE) THIS APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED 20/09/2019 PASSED IN IT(TP)A NO.779/BANG/2017, FOR THE ASSESSMENT YEAR 2012-2013, PRAYING THIS HON’BLE COURT TO: (A) DECIDE THE FOREGOING QUESTION OF LAW AND / OR SUCH OTHER QUESTIONS OF LAW AS MAY BE FORMULATED BY THE HON'BLE COURT AS DEEMED FIT AND ETC. THIS APPEAL, COMING ON FOR HEARING, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.G.PANDIT and HON'BLE MR JUSTICE C.M. POONACHA ORAL JUDGMENT (PER: HON'BLE MR JUSTICE S.G.PANDIT) Heard the learned counsel Sri.Sanmathi.E.I., for appellants/Revenue and learned counsel Smt.Tanmayee Rajkumar for respondent/assessee. 2. The Revenue is in appeal under Section 260-A of the Income Tax Act, 1961 (for short, ‘the Act’) questioning the correctness and legality of order dated 20.09.2019 passed by the Income Tax Appellate Tribunal, ‘B’ Bench, Bengaluru (for short, ‘Appellate Authority’) in IT(TP)A.No.779/Bang/2017 for the assessment year 2012-13. 3. This Court, admitted the appeal on 17.09.2021 to consider the following substantial question of law: “1) Whether on the facts and circumstances of the case and in law, the Tribunal was right in law in excluding comparables on the basis of presence of intangibles without showing how these factors fall within the scope of factors specified in Rule 10B(2) of the Act? 2) Whether the exclusion of a comparable entity can be sustained without determining the specific characteristics of the transaction; FAR; contractual terms and market conditions as prescribed in Rule 10B(2) of the Act? 3) Whether the objection to the selection of comparable is legally sustainable?” 4. Learned counsel for the assessee submits that the tax effect in this appeal is less than Rs.2 Crores and therefore, the appeal should not be entertained at the instance of the revenue in view of the Circular No.09/2024 dated 17.09.2024 issued by the Central Board of Direct - 4 - Taxes. It is also submitted that the aforesaid Circular binds the revenue. 5. On the other hand, learned counsel for the revenue submits that he be granted liberty to revive the appeal in case the matter falls within the exceptions under the aforesaid Circular dated 17.09.2024 and Circular No.5/2024 dated 15.03.2024. 6. In view of the aforesaid submissions, the appeal is disposed of with liberty as prayed for by the learned counsel for the revenue. However, the question of law is kept open to be adjudicated in an appropriate proceeding. Sd/- (S.G.PANDIT) JUDGE Sd/- (C.M. POONACHA) JUDGE MPK CT:VN