Principal Commissioner Of Income Tax 1 v. M/S.craftsman Automation Pvt. Ltd

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 07.06.2019 CORAM : THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMandTHE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN Tax Case Appeal Nos.56 & 57 of 2018 Principal Commissioner of Income Tax 1,No.63, Race Course Road, Coimbatore. ...Appellant in both the appeals -vs- M/s.Craftsman Automation Pvt. Ltd.,No.15, LML Colony, Pappanaickenpalayam,Coimbatore – 641 018. ...Respondent in both the appeals Tax Case Appeals filed under Section 260-A of the Income TaxAct, 1961 are directed against the order of the Income TaxAppellate Tribunal Chennai 'B' Bench, dated 12.05.2017 in ITANo.19/Mds/2012 & ITA No.1835/Mds/2012 for the Assessment years2004-05 and 2003-04 respectively. against the Order of theCommissioner of Income Tax (Appeals)-I, Coimbatore, in AppealNo.179/0-10 and Appeal No.43/11-12, dated 28.10.2011 and31.07.2012 for the Assessment year 2004-2005 and 2003-2004respectively preferred against the order of the AssistantCommissioner of Income Tax, Company circle-IV(1)-Coimbatore inPAN NO.AABCC2461C dated 29.12.2006 and 29.03.2006 for theAssessment year 2004-2005 and 2003-2004 respectively. [Common Judgement of the Court was made by T.S.Sivagnanam, J.] These Tax Case Appeals by the appellant/Revenue aredirected against the common order of the Income Tax Appellate https://hcservices.ecourts.gov.in/hcservices/ Tribunal Chennai 'B' Bench, dated 12.05.2017 in ITANo.19/Mds/2012 & ITA No.1835/Mds/2012 for the Assessment years2004-05 and 2003-04 respectively. 2.Heard Mr.T.R.Senthil Kumar, learned Senior StandingCounsel for the appellant/Revenue in both the appeals andMr.A.S.Sriraman, learned counsel for the respondent/assessee inboth the appeals. 3.These Appeals have been filed raising the followingSubstantial Questions of Law:"(i)Whether,onthefactsandcircumstances of the case, the Income TaxAppellate Tribunal was right in upholding thechartered Engineer's certificate when thecriteria and method adopted by the charteredEngineer is applicable for textile mills only,which is not applicable and relevant to thepresent case where the assessee is involved inproduction of various non-homogeneous productsusing different types of machines? (ii) Whether on the facts and in thecircumstances of the case, the AppellateTribunal was justified in law in holding thatthe Chartered Engineer's certificate is to betaken into consideration for arriving at theinstalled capacity when the report underconsideration itself was only a post mortemreport as it is practically impossible for anyexpert in the field to give a correct estimateon the capacity increase from the period 2002-03 to the period 2003-04, after even sevenyears, i.e., in the year 2009?” 4.We have perused the order of Assessment as well as thecommon order passed by the Commissioner of Income Tax and wefind that the tax effect in these appeals are lesser than thethreshold limit mentioned in Circular No.3 of 2018, dated11.07.2018, issued by the Central Board of Direct Taxes, whichfixes the monetary limit as Rs.50,00,000/- for the Department topursue the matters. Furthermore, the Revenue has not been ableto point out any distinguishing features, by which the CircularNo.3 of 2018, dated 11.07.2018, cannot be applied. 5.Thus, for the above reasons, the Revenue cannot pursuethese Appeals in view of the low tax effect. Hence, theseAppeals are dismissed and the Substantial Questions of Law, https://hcservices.ecourts.gov.in/hcservices/ framed for consideration, are left open. No costs. TheRevenue is at liberty to seek for restoration of appeals, if ata later point of time, it is found that the tax effect is abovethe threshold limit. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar To 5.Thus, for the above reasons, the Revenue cannot pursuethese Appeals in view of the low tax effect. Hence, theseAppeals are dismissed and the Substantial Questions of Law, https://hcservices.ecourts.gov.in/hcservices/ framed for consideration, are left open. No costs. TheRevenue is at liberty to seek for restoration of appeals, if ata later point of time, it is found that the tax effect is abovethe threshold limit. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar To 1. Income Tax Appellate Tribunal Madras 'B' Bench, Chennai.2. The Commissioner of Income Tax (Appeals-I), Coimbatore.3. The Assistant Commissioner of Income Tax Company circle-IV(1), Coimbatore. +1cc to M/s.T.R.S.Senthil Kumar, Advocate, S.R.No.45756 Tax Case Appeal No.56 & 57 of 2018BP(CO)RV(02/12/2020)