Ita/378/2023 Of The Pr. Commissioner Of Income Tax v. M/S Menzies Aviation Bobba (Bangalore) Pvt Ltd

Digitallysigned byBHARATHI SLocation:HIGHCOURT OFKARNATAKA NC: 2024:KHC:40490-DB ITA No. 378 of 2023 IN THE HIGH COURT OF KARNATAKA AT BENGALURU DATED THIS THE 26 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. 378 OF 2023 BETWEEN: 1. THE PR. COMMISSIONER OF INCOME-TAX, 5 FLOOR, BMTC BUILDING, 80 FEE ROAD, KORMANGALA, BENGALURU-560 095. 2. THE ASST. COMMISSIONER OF INCOME TAX, CIRCLE-4(1)(2) PRESENT ADDRESS DCIT, CIRCLE 4- (1 )(1), 2 FLOOR, BMTC BUILDING, 80 FEET ROAD, KORMANGALA, KORMANGALA, BENGALURU-560 095. …APPELLANTS (BY SRI. DILIP M., A/W SRI. RAVIRAJ Y.V., ADVOCATES) - 2 - ITA No. 378 of 2023 AND: M/S. MENZIES AVIATION BOBBA (BANGALORE) PVT. LTD., PLOT NO. C- 04 L, CARGO TERMINAL 1, KEMPEGOWDA INTERNATIONAL AIRPORT, BENGALURU-560 300, PAN: AAECM 6862D …RESPONDENT (BY SRI. MADHUSUDHAN U A., ADVOCATE) THIS ITA / INCOME TAX APPEAL IS FILED UNDER SEC.260-A OF INCOME TAX ACT 1961, PRAYING TO FORMULATE THE SUBSTANTIAL QUESTIONS OF LAW STATED ABOVE AND ETC. THIS APPEAL, COMING ON FOR ORDERS, THIS DAY, JUDGMENT WAS DELIVERED THEREIN AS UNDER: CORAM: HON'BLE MR JUSTICE S.G.PANDIT and HON'BLE MR JUSTICE C.M. POONACHA - 3 - ORAL JUDGMENT (PER: HON'BLE MR JUSTICE S.G.PANDIT) Though this appeal is listed for orders, the matter is taken up for disposal in view of Circular No.09/2024 dated 17.09.2024, wherein monetary value is raised to Rs.2 Crores for filing an appeal by the Revenue. 2. Heard the learned counsel Sri.Dilip.M., along with Sri. Raviraj.Y.V., learned counsel for appellants/Revenue and learned counsel Sri. Madhusudhan.U.A. for respondent/assessee. 3. 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 05.12.2022 passed by the Income Tax Appellate Tribunal, ‘B’ Bench, Bengaluru (for short, ‘Appellate Authority’) in ITA.No.854/Bang/2022 for the assessment year 2017-18, raising the following substantial questions of law: 1."Whether, on the facts and in the circumstances of the case, the Tribunal was - 4 - justified in law in holding that the BIAL is a Statutory Body when it cannot be considered as it is a corporate body in which KSIIDC is holding a mere 13% share in BIAL registered under Companies Act and it fails to satisfy the requirements of section 40IA(4) of the I.T.Act?" 2."Whether, on the facts and in the circumstances of the case, the Tribunal is justified in law in holding that the cargo handling contract entered into with BIAL by assessee is with statutory body satisfying condition set forth in section 80IA(4) when BIAL is only a Company whose motive only making profit and is only a instrument of State?" circumstances of the case, the Tribunal is justified in law in holding that the cargo handling contract entered into with BIAL by assessee is with statutory body satisfying condition set forth in section 80IA(4) when BIAL is only a Company whose motive only making profit and is only a instrument of State?" 3."Whether, on the facts and in the circumstances of the case, Tribunal's order is perverse in nature as Tribunal has erred in holding that assessee is eligible for claiming circumstances of the case, Tribunal's order is perverse in nature as Tribunal has erred in holding that assessee is eligible for claiming deduction under section 80IA(4)(ib) of the act even when the assessee has not satisfied the conditions set out in the said provision to make such a claim as the assessee has not entered into agreement with Government nor is involved in development of infrastructure activity as defined in the Act"? 3."Whether, on the facts and in the circumstances of the case, Tribunal's order is perverse in nature as Tribunal has erred in holding that assessee is eligible for claiming circumstances of the case, Tribunal's order is perverse in nature as Tribunal has erred in holding that assessee is eligible for claiming deduction under section 80IA(4)(ib) of the act even when the assessee has not satisfied the conditions set out in the said provision to make such a claim as the assessee has not entered into agreement with Government nor is involved in development of infrastructure activity as defined in 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. 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 SMJ List No.: 3 Sl No.: 1