Panaji Goa v. M/S The Goa State Co-Operative Bank Ltd.,Ground Floor

IN THE HIGH COURT OF BOMBAY AT GOA TAX APPEAL NO. 24 OF 2016 The Pr. Commissioner of Income Tax, having office at Aayakar Bhavan, Panaji Goa. ... Appellant Versus M/s The Goa State Co-operative Bank Ltd.,Ground Floor, Sahakar Sankul, Patto,Panaji Goa. PAN NO.AAAAT 3364 ... Respondent Ms. S. Linhares, Standing Counsel for the Appellant.Mr. S. R. Rivankar, Senior Advocate with Mr. Rama Rivankar, Advocatefor the Respondent. Coram:- M. S. SONAK & DAMA SESHADRI NAIDU, JJ. Date:- 28th October, 2020 ORAL JUDGMENT (Per M. S. Sonak, J) Heard Ms. S. Linhares, learned Standing counsel for theAppellant and Mr. S. R. Rivankar, learned Senior Advocate who appearsalongwith Mr. Rama Rivankar for the Respondent. 2. This appeal was admitted on 31st August, 2016, on the following two substantial questions of law :- (a) Whether in law, the order passed by the Income TaxAppellate Tribunal is sustainable in so far as it dismissed the appeal filed by the revenue by declining to interfere in theorder of Commissioner of Income Tax, by holding thatprovision for standard asset is the diminution in the value of order of Commissioner of Income Tax, by holding thatprovision for standard asset is the diminution in the value ofstock-in-trade and thus allowable u/s 28(1) of the Act ? (b) Whether in law, the order passed by the Income Tax Appellate Tribunal is sustainable in law as no reasons have been assigned by the Tribunal for answering the issue No./ground No.2 raised in appeal memo before Tribunal by the revenue as it mechanically answers the same in favour of the assessee without discussing the applicability of facts ofthe case of Nainital ( supra) of Supreme Court to the factsof the present case ? 3. Both these substantial questions of law concern theprovision for standard asset. The amount involved is in the range of₹17,00,000/- and therefore the tax effect will be around 5,00,000/-.₹ 4. Mr. Rivankar points out that the appellant at the stage of admission of this appeal had urged another substantial question of lawbased upon investment depreciation reserve. The tax effect as far as thisquestion was concerned may have exceeded 1 Crore. However, by order₹dated 31st August, 2016, this Court declined to frame such substantial question of law. 5. According to us, the tax effect on the basis of substantialquestions of law also framed is hardly 5,00,000/- then the CBDT₹Circular No.17 of 2019 dated 8th August, 2019 will come in the way ofdepartment prosecuting this appeal. 6. In such similar circumstances, we had disposed of TaxAppeal No.72 of 2015 by our order dated 13th October, 2020. 7. Accordingly, we dispose of this appeal without answeringthe substantial questions of law as framed on the sole ground that thetax effect now involved in this appeal is hardly 5,00,000/- or₹thereabouts. 8. This appeal is accordingly disposed of. There shall be noorder as to costs. DAMA SESHADRI NAIDU, J. M. S. SONAK, J. at*