Principal Commissioner Of Income Tax-2, Chennai-34 v. M/S.greenland Exports Pvt.ltd., Chennai-17

In the High Court of Judicature at MadrasDated : 30.8.2019 The Honourable Mr.Justice T.S.SIVAGNANAM The Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Principal Commissioner of Income Tax-2, Chennai-34...Appellant/Appellant VsM/s.Greenland Exports Pvt.Ltd., Chennai-17....Respondent/Respondent Prayer: APPEAL under Section 260A of the Income Tax Act, 1961against the order dated 28.12.2015 made in ITA.No.1927/Mds/2015on the file of the Income Tax Appellate Tribunal, Chennai 'D'Bench for the assessment year 2008-09, and against theCommissioner of Income Tax(Appeals)-6, Chennai-34, dt.6.3.2005,made in ITA.No.133/CIT(A)-6/2011-12 for the assessment year2008-2009, and against the order of the Assistant Commissionerof Income Tax Company Circle-II(2), Chennai-34, dt.16.2.12 madein PAN/GIR.No. , for the assessment year 2008-2009. Judgment was delivered by T.S.Sivagnanam,J We have heard Mr.Karthik Ranganathan, learned Senior StandingCounsel assisted by Mr.S.Rajesh, learned Standing Counselappearing for the appellant – Revenue and Mr.R.Sandeep Bagmar,learned counsel appearing for the respondent – assessee. 2. This appeal, filed by the Revenue under Section 260A ofthe Income Tax Act, 1961 is directed against the order dated28.12.2015 made in ITA. No.1927/Mds/2015 on the file of theIncome Tax Appellate Tribunal, Chennai 'D' Bench for theassessment year 2008-09. 3. The appeal was admitted on 22.8.2016 on the followingsubstantial questions of law :“i. Whether on the facts and in thecircumstances of the case, the AppellateTribunal was right in restricting thequantum of upward revision by adopting ALPat Rs.18.18 crores as against Rs.16.42crores determined by the Assessing officer?ii. Is not the finding of the TribunalperverseinholdingInternalTNMM(Transactional Net Margin Method) could betaken for justifying the ALP determinationwherein the uncontrolled entities maintainedby the assessee are associate enterprise ofthe group companies which is hit by Section92A(2)(i) of the Income Tax Act? andiii. Whether on the facts and in thecircumstances of the case, the Tribunal wasright in not considering the fact that whilecomputing ALP transaction with related partyhad been taken into account which is againstthe provisions of the statute?" 4. The learned Senior Standing Counsel for the appellantsubmits that the above appeal is not pursued by the Revenue onaccount of the low tax effect in terms of Circular No.17/2019dated 08.8.2019 issued by the Central Board of Direct Taxes. Bythe said Circular, the monetary limit for filing or pursuing anappeal before the High Court has been increased to Rs.1 Crore.It is further submitted that the tax effect in this case is lessthan the threshold limit. 5. In the light of the said submissions, the above tax caseappeal is dismissed on account of the low tax effect. Thesubstantial questions of law framed are left open. In the eventthe tax effect is above the threshold limit fixed in the saidcircular, liberty is granted to the Revenue to make a mention tothis Court to restore the appeal to be heard and decided onmerits. No costs. RS 2 To 1.The Income Tax Appellate Tribunal, Chennai 'D' Bench. Chennai 'D' Bench. 2.The Commissioner of Income Tax(Appeals)-6, Chennai. Chennai. 3.The Commissioner of Income Tax, Company Circle-II(2), Chennai-34. Company Circle-II(2), Chennai-34. +1cc to Mr.Subbarayaaiyar Padmanabhan, Advocate SR.75930 TCA.No.578 of 2016MR(CO)CB(25/11/2019)