Ita/102/2021 Of Principal Commissioner Of Income Tax-4 v. M/S Maharastra Apex Corporation Ltd

Digitallysigned by BLAVANYALocation:HIGHCOURT OFKARNATAKA NC: 2024:KHC:39705-DBITA No. 102 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. 102 OF 2021 BETWEEN: 1. PRINCIPAL COMMISSIONER OF INCOME TAX-4, BMTC COMPLEX, KORAMANGALA, BENGALURU. BENGALURU. 2. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-1, BMTC COMPLEX, CIRCLE-1, BMTC COMPLEX, KORAMANGALA, BENGALURU. …APPELLANTS (BY SRI SANMATHI E. I., ADV.) AND: M/S. MAHARASTRA APEX CORPORATION LTD., SYNDICATE HOUSE, MANIPAL, PAN: . …RESPONDENT (BY SRI TATA KRISHNA, ADV.) THIS APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, ARISING OUT OF ORDER DATED 20/09/2019 PASSED IN ITA NO.253/BANG/2018, FOR THE ASSESSMENT YEAR 2008-2009, PRAYING THIS 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: - 2 - 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 Sri.Tata Krishna 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, ‘A’ Bench, Bengaluru (for short, ‘Appellate Authority’) in ITA.No.253/Bang/2018 for the assessment year 2008-09. 3. This Court, admitted the appeal on 17.02.2022to consider the following substantial question of law: “Whether on the facts and circumstances of the case, the Tribunal is right in law in setting aside disallowance made by assessing authority in respect of amount surrendered by depositors out of - 3 - principal portion of the amount to an extent of Rs.3,77,52,631/- ignoring the provisions of section 28(1)(iv) of the Act, wherein, it was clearly stated that the part of the deposits retained by the assessee is the benefit accrued to the assessee in the course of carrying on the business and the same is liable for tax under section 28(1)(iv) of the Act?” 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 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. - 4 - NC: 2024:KHC:39705-DBITA No. 102 of 2021 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 List No.: 2 Sl No.: 19