Tca/1074/2014 Of Commissioner Of Income Tax v. Shri S.duraipandi

In the High Court of Judicature at MadrasDated : 27.7.2020Coram : The Honourable Mr.Justice T.S.SIVAGNANAM The Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal Nos.1074 to 1077 & 1079 of 2014 The Commissioner of Income Tax,Central Circle, Chennai...Appellant/Appellant VsShri S.Duraipandi...Respondent/Respondent APPEALS under Section 260A of the Income Tax Act, 1961against the common order dated 29.4.2011 made respectively inITA.Nos. 1745 to 1748 & 1750/Mds/2010 on the file of the IncomeTax Appellate Tribunal, Chennai 'C' Bench for the assessmentyears from 2002-03 to 2005-06 and 2007-08 against the order ofthe Assistant Commissioner of Income Tax, Central Circle -III(4)Chennai, dated 27.05.2011 made in CO.Nos.1074, 1075, 1076, 1077and 1079 of 2010 for the Assessment Years 2002-03 to 2005-06 and2007-08. For Appellant : Mr.T.R.Senthilkumar, SSC assisted by Ms.K.G.Usharani, SCFor Respondent : Mr.R.SivaramanCOMMON JUDGMENT(Judgment was delivered by T.S.Sivagnanam,J) We have heard Mr.T.R.Senthilkumar, learned Senior StandingCounsel assisted by Ms.K.G.Usharani, learned Standing Counselappearing for the appellant – Revenue and Mr.R.Sivaraman,learned counsel appearing for the respondent – assessee. https://hcservices.ecourts.gov.in/hcservices/ 2. These appeals, filed by the Revenue under Section 260A ofthe Income Tax Act, 1961 (for brevity, the Act), are directedagainst the common order dated dated 29.4.2011 made respectivelyin ITA.Nos. 1745 to 1748 & 1750/Mds/2010 on the file of theIncome Tax Appellate Tribunal, Chennai 'C' Bench (for short, theTribunal) for the assessment years from 2002-03 to 2005-06 and2007-08. 3. The appeals were admitted on 10.3.2015 on the followingsubstantial questions of law : “TCA.Nos.1074 to 1077 of 2014: “1. Whether on the facts andcircumstances of the case, the Tribunal wasright in presuming the assessee earnedagricultural income merely relying on Chittaand Adangal extracts issued by VAO despitethe fact that no evidences pertaining toagricultural activities were furnished bythe assessee?2. Whether on the facts andcircumstances of the case, the Tribunal canestimate the agricultural income withoutthere being any proof that the assessee wasactually engaged in agricultural activityand the onus to prove the same wasagricultural income lies on the assessee?3. Whether on the facts andcircumstances of the case, the Tribunal wasright in presuming that the agriculturalincome based on the land holding of theassessee including lease hold lands on theoral contracts with the lessees even thoughthe assessee failed to produce any evidencein support of such a claim for itsagricultural activities?” TCA.No.1079 of 2014:“1. Whether on the facts andcircumstances of the case, the Tribunal wasright in presuming the assessee earnedagricultural income merely relying on Chittaand Adangal extracts issued by VAO despitethe fact that no evidences pertaining toagricultural activities were furnished bythe assessee?2. Whether on the facts andcircumstances of the case, the Tribunal canestimate the agricultural income withoutthere being any proof that the assessee wasactually engaged in agricultural activityand the onus to prove the same wasagricultural income lies on the assessee? 3. Whether on the facts andcircumstances of the case, the Tribunal wasright in presuming that the agriculturalincome based on the land holding of theassessee including lease hold lands on theoral contracts with the lessees even thoughthe assessee failed to produce any evidencein support of such a claim for itsagricultural activities? 4. Whether on the facts andcircumstances of the case, the Tribunal wascorrect in presuming that an addition ofRs.4.9 crores is to be done in the case ofS.Duraipandi (individual) and not as AOP inspite of the fact that the assessee hasadmitted the same and as per the documentsseized? and 3. Whether on the facts andcircumstances of the case, the Tribunal wasright in presuming that the agriculturalincome based on the land holding of theassessee including lease hold lands on theoral contracts with the lessees even thoughthe assessee failed to produce any evidencein support of such a claim for itsagricultural activities? 4. Whether on the facts andcircumstances of the case, the Tribunal wascorrect in presuming that an addition ofRs.4.9 crores is to be done in the case ofS.Duraipandi (individual) and not as AOP inspite of the fact that the assessee hasadmitted the same and as per the documentsseized? and 5. Whether on the facts and in thecircumstances of the case, the Income TaxAppellate Tribunal was right in deleting theaddition of Rs.50 lakhs being the money paidby the assessee to Jaya Krishnamurthy inrespect of the land deal contrary to Section68 of the Income Tax Act?” 4. It is submitted by the learned Senior Standing Counselappearing for the Revenue that the above questions have alsobeen admitted in the assessee's own case in TCA.Nos.1078 and1080 of 2014 and that therefore, though in the above five taxcase appeals, the tax effect is lower than the threshold limit,the Revenue may be permitted to pursue the matters together sothat in the event of the Revenue succeeding in the appeals, theexchequer will be able to recover tax. 5. In our considered view, the proper interpretation of thecircular issued by the Central Board of Direct Taxes is that ifthe tax effect is lower than the threshold limit, the Revenuecannot file nor pursue the appeals, which are pending eitherbefore the Tribunal or before this Court or before the Hon'bleSupreme Court. However, in order to safeguard the concernexpressed by the learned Senior Standing Counsel for theRevenue, we make an observation to the effect that though theaforementioned five appeals are to be disposed of on the groundof low tax effect, the same will not be a bar for the Revenue tocanvass the aforementioned substantial questions of law, whichare also the substantial questions of law framed forconsideration in TCA. Nos.1078 & 1080 of 2014. 6. Accordingly, the above tax case appeals are dismissed onaccount of the low tax effect. The substantial questions of lawframed are left open. In the event the tax effect in therespective cases is above the threshold limit fixed in the said circular, liberty is granted to the Revenue to make a mention tothis Court to restore the appeals to be heard and decided onmerits. No costs. Sd/-Assistant Registrar(CS-I)//True copy//Sub Assistant RegistrarRSTo1.The Income Tax Appellate Tribunal, Chennai 'C' Bench.2. The Assistant Commissioner of Income Tax, Central Circle -III(4), Chennai.3. The Commissioner of Income Tax, Central Circle, Chennai.4. The Section Officer, VR Section, High Court, Chennai.+1cc to Mr.T.S.Senthil Kumar, Advocate SR.No.25335TCA.Nos.1074 to 1077 & 1079of 2014 AK(CO)GMY(18/08/2020)