Principal Commissioner Of Incometax-6 v. M/S.sunstar Hotel & Estatespvt. Ltd., Chennai-17

IN THE HIGH COURT OF JUDICATURE AT MADRAS CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM AND THE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN TAX CASE APPEAL No.738 of 2019(heard through video conferencing) Principal Commissioner of IncomeTax-6, No.121, NungambakkamHigh Road, Chennai-34. ...Appellant/Respondent Vs M/s.Sunstar Hotel & EstatesPvt. Ltd., Chennai-17....Respondent /Appellant APPEAL under Section 260A of the Income Tax Act, 1961against the order dated 07.6.2019 made in ITA.No.3269/Chny/2018on the file of the Income Tax Appellate Tribunal, Chennai ‘D’Bench for the assessment year 2013-14 against the order passedby the Commissioner of Income Tax (Appeals) – 15, Chennai 34,dated 30.08.2018 made in ITA.No. 640/2016-17 /CIT (A)-15 andagainst the order passed by the Deputy Commissioner of IncomeTax, Corporate Circle 6 (2), Chennai 34 dated 31.03.2016 madein PAN . Judgment was delivered by T.S.SIVAGNANAM,J This appeal, by the Revenue under Section 260A of the IncomeTax Act, 1961 (for short, the Act), is directed against theorder dated 07.6.2019 made in ITA.No.3269/Chny/2018 on the fileof the Income Tax Appellate Tribunal, Chennai ‘D’ Bench for theassessment year 2013-14. 2. We have heard Mr.J.Narayanasamy, learned Senior StandingCounsel appearing for the appellant – Revenue and Mr.Ashokpathy,learned counsel appearing for the respondent – assessee. 3. The appeal has been filed by the Revenue by raising the https://hcservices.ecourts.gov.in/hcservices/ following substantial questions of law : “1. Whether the Appellate Tribunal wasright in holding that the expenses, whichare not attributable to the business can beallowed as business expenses under Section37 of the Income Tax Act ? 2. Whether, on the facts andcircumstances and in law, the AppellateTribunal was right in considering the incomeearned from financial services as businessincome when the main object of the companywas hotel business and that business had notat all commenced by the assessee ? And 3. Whether the Appellate Tribunal wasright in allowing the expenses under Section37 of the Act, when the assessee altered thememorandum of association and removed hotelbusiness as one of its main object witheffect from 08.3.2016 and the same is notapplicable to the present assessment year2013-14 ?” 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 raised are left open. In the eventthe tax effect is above the threshold limit fixed in the saidcircular, liberty is granted to the Revenue to file a petitionto this Court to restore the appeal to be heard and decided onmerits. No costs. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar RS To 1.The Income Tax Appellate Tribunal, Chennai ‘D’ Bench. 2.The Principal Commissioner of Income Tax -6, No.121, Nungambakkam, High Road, Chennai 34. No.121, Nungambakkam, High Road, Chennai 34. 3.The Income Tax (Appeals)-15, Chennai – 34. Chennai – 34. 4.The Deputy Commissioner of Income Tax, Corporate Circle 6 (2), Chennai – 34. Corporate Circle 6 (2), Chennai – 34. T.C.A.No.738 of 2019 BS(CO)GN(01/02/2021)