Tca/654/2018 Of Commissioner Of Income Tax v. Trimex Sands Pvt Ltd

IN THE HIGH COURT OF JUDICATURE AT MADRASDATED : 28.08.2019 CORAM : THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMAND THE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN Commissioner of Income Tax,Corporate Circle-3, Chennai. ...Appellant/Respondent M/s.Trimex Sands Private Limited,No.1, Subbaraya Avenue, CP Ramaswamy Road,Alwarpet, Chennai - 600 018.PAN: ...Respondent/Appellant APPEALS under Section 260A of the Income Tax Act, 1961against the common order dated 26.07.2017 made in ITA.Nos.383,384, 418 and 419/Mds/2017 on the file of the Income TaxAppellate Tribunal, Chennai 'C' Bench for the assessment years2011-12 and 2012-13 against the Order of the Commissioner ofIncome Tax (Appeals)-II, Chennai -34, made in ITA Nos.173/2014-15/CIT(A)-11 and 194/2015-16/CIT (A)-11, dated 30.11.2016against the Order of the Joint Commissioner of Income TaxCompany Range-III, Chennai, made in PAN No. dated29.03.2014 and 31.03.2015 for the Assessment Year 2011-12 and2012-13 respectively. For Appellant: Mr.M.Swaminathan, SSC assisted byin all TCAs Ms.V.Pushpa, SSC For Respondent : Mr.N.Devanathanin all TCAs We have heard Mr.M.Swaminathan, learned Senior StandingCounsel assisted by Ms.V.Pushpa, learned Senior Standing Counselappearing for the appellant – Revenue and Mr.N.Devanathan,learned counsel appearing for the respondent - Assessee. 2.These appeals, filed by the Revenue under Section 260A ofthe Income Tax Act, 1961, are directed against the common orderdated 26.07.2017 made in ITA.Nos.383, 384, 418 and 419/Mds/2017on the file of the Income Tax Appellate Tribunal, Chennai 'C'Bench for the assessment years 2011-12 and 2012-13. https://hcservices.ecourts.gov.in/hcservices/ 3.The appeals were admitted on 16.11.2018 on the followingsubstantial questions of law :“TCA.Nos.654 and 655 of 2018 :i. Whether the Tribunal was right in holdingthat the provision of Section 14A read with Rule 8Dwill have no applicability if there is no exemptincome received or earned during the previous year,though the disallowance is linked to expenditureincurred on investment fetching exempt income ?ii. Whether the Tribunal was right in deletingthe disallowance of interest under Section 36(1)(iii) on borrowed loans/advance diverted to thesubsidiary company without charging interest ?iii. Whether the Tribunal was right in holdingthat the liquidated damages received during thecourse of business is capital receipt and hence,not taxable as income ? AndTCA.Nos.656 & 657 of 2018 :iv. Whether the Tribunal was right in allowingdepreciation under Section 32(1)(ii) on road laid inon the land owned by the Government of AndhraPradesh and used by the assessee as well as publicholding the same as building ? ” 4.The learned Senior Standing Counsel for the appellantsubmits that the above appeals are 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 the respectivecases is less than the threshold limit. 5. In the light of the said submissions, the above tax caseappeals are dismissed on account of the low tax effect. Thesubstantial questions of law framed are left open. In the eventthe tax effect in the respective cases is above the thresholdlimit fixed in the said circular, liberty is granted to theRevenue to make a mention to this Court to restore the appealsto be heard and decided on merits. No costs. cse Sd/- Assistant Registrar(CS VI) //True Copy// Sub Assistant Registrar To 1.The Income Tax Appellate Tribunal, Chennai 'C' Bench, Chennai. 2. The Commissioner of Income Tax,Corporate Circle-3, Chennai. 3.The Commissioner of Income Tax (Appeals)-II,Chennai -34, 5. In the light of the said submissions, the above tax caseappeals are dismissed on account of the low tax effect. Thesubstantial questions of law framed are left open. In the eventthe tax effect in the respective cases is above the thresholdlimit fixed in the said circular, liberty is granted to theRevenue to make a mention to this Court to restore the appealsto be heard and decided on merits. No costs. cse Sd/- Assistant Registrar(CS VI) //True Copy// Sub Assistant Registrar To 1.The Income Tax Appellate Tribunal, Chennai 'C' Bench, Chennai. 2. The Commissioner of Income Tax,Corporate Circle-3, Chennai. 3.The Commissioner of Income Tax (Appeals)-II,Chennai -34, 4.The Joint Commissioner of Income Tax Company Range-III, Chennai.+1cc to Mr.M.Swaminathan, Advocate, SR.No.74840 TCA.Nos.654 to 657 of 2018Kak(07/11/2019)