The Commissioner Of Income Tax, Chennai v. M/S.bnt Connections Impex Ltd

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 27.08.2019 CORAM : THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMANDTHE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN TAX CASE APPEAL NO.216 OF 2015 The Commissioner of Income Tax,Chennai....Appellant/AppellantVs M/s.BNT Connections Impex Ltd.,No.41, K.K.R. Avenue, Moolakadai,Perambur, Chennai - 600 011....Respondent/Respondent APPEAL under Section 260A of the Income Tax Act, 1961 againstthe order dated 20.03.2014 made in ITA.No.1466/MDS/2013 on thefile of the Income Tax Appellate Tribunal, Chennai 'C' Bench forthe assessment year 2009-10 against the Order of theCommissioner of Income Tax (Appeals)-III, Chennai -34, dated22.03.2013 made in ITA No.340/11-12/A-III and against the Orderof the Assistant Commissioner of Income Tax, Company Circle-I(2), Chennai-34. For Appellant: Mr.T.Ravikumar, SSC and Ms.R.Hemalatha, SSCFor Respondent : Mr.R.Sivaraman JUDGMENT (Judgment was delivered by T.S.Sivagnanam,J.) We have heard Mr.T.Ravikumar, learned Senior StandingCounsel, and Ms.R.Hemalatha, learned Senior Standing Counselappearing for the appellant/revenue and Mr.R.Sivaraman, learnedcounsel 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 dated20.03.2014 made in ITA.No.1466/MDS/2013 on the file of theIncome Tax Appellate Tribunal, Chennai 'C' Bench for theassessment year 2009-10. https://hcservices.ecourts.gov.in/hcservices/ 3.The appeal was admitted on 09.06.2015 on the followingsubstantial questions of law : “1) Whether on the facts and circumstancesof the case, the Tribunal was right in deletingthe disallowance of interest made under Section36(1)(iii)? 2) Is not the finding of the Tribunal badespecially when it had deleted the disallowanceof interest made under Section 36(1)(iii) theassessee company itself was in need of fund andhad to sell a property for paying theoutstanding dues and there was no direct nexusbetween the borrowing and advances made? 3) Whether the Tribunal was right indeleting the disallowance of interest especiallywhen there was no compelling necessity for theassessee to Advance interest free loans out ofborrowed funds that too in unproductioninvestments?" 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. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar To 1. The Income Tax Appellate Tribunal, Chennai 'C' Bench, Chennai. 2. The Commissioner of Income Tax,Chennai -34, 3. The Commissioner of Income Tax (Appeals)-III,Chennai-34. 4. 3. The Assistant Commissioner of Income Tax Company Circle-I(2),Chennai-34. +1cc to Mr.T.Ravikumar, Advocate, SR.No.73352TCA.No.216 of 2015 Kak(15/10/2019)