The Commissioner Of Income Tax, Chennai v. M/S.crazy Infotech Ltd., Chennai-83

In the High Court of Judicature at Madras Dated : 30.8.2019 Coram : The Honourable Mr.Justice T.S.SIVAGNANAM and The Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal No.55 of 2016 The Commissioner of Income Tax, Chennai...AppellantVsM/s.Crazy Infotech Ltd.,Chennai-83....Respondent APPEAL under Section 260A of the Income Tax Act, 1961 againstthe order dated 10.7.2015 made in ITA.No.1226/Mds/2014 on thefile of the Income Tax Appellate Tribunal, Chennai 'C' Bench forthe assessment year 2007-08. Against the Order dated 20/02/2014 made in ITA.No. 398/13-14on the file of the Commissioner of Income Tax (A) (C) -II,Chennai and against the order dated 30/1/2019 on the file of theDeputy Commissioner of Income Tax – 1, Assessment Year 2007-08. For Appellant:Mr.T.Ravikumar, SSC and Mrs.R.Hemalatha, SSCFor Respondent:Ms.Sree Lakshmi Valli for Mr.G.Baskar Judgment was delivered by T.S.Sivagnanam,J We have heard Mr.T.Ravikumar and Mrs.R.Hemalatha, learnedSenior Standing Counsel appearing for the appellant – Revenueand Ms.Sree Lakshmi Valli, learned counsel appearing for therespondent – assessee. 2. This appeal, filed by the Revenue under Section 260A ofthe Income Tax Act, 1961 is directed against the order dated10.7.2015 made in ITA.No. 1226/Mds/2014 on the file of theIncome Tax Appellate Tribunal, Chennai 'C' Bench for theassessment year 2007-08. https://hcservices.ecourts.gov.in/hcservices/ 3. The appeal was admitted on 08.2.2016 on the followingsubstantial questions of law :“(i) Whether on the facts andcircumstances of the case, the Tribunal wasright in allowing depreciation on noncompete fees at the rate of 25% ?(ii) Is not the finding of the Tribunalbad by allowing depreciation on non competefees especially when the same cannot beclassified as business right or commercialright as mentioned in Appendix-I of theIncome Tax Rules, 1962 and as such, nodepreciation is allowable ? and(iii) Is not the finding of the Tribunalbad by allowing depreciation on non competefees especially when right to trade freelyand to compete in the market is not an assetand right to personal service under acontract of service is unassignable, whichcannot be bought or sold and has no actualmarketable value and hence, cannot be termedas an asset ?" 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 To Sub Assistant Registrar 1.The Income Tax Appellate Tribunal, Chennai 'C' Bench. Chennai 'C' Bench. https://hcservices.ecourts.gov.in/hcservices/ 2.The Commissioner of Income Tax (A) -II, Chennai-34. Chennai-34. 3.The Deputy Commissioner of Income Tax-1, Bhilai. Bhilai. +1cc to Mr.T.Ravi Kumar, Advocate, S.R.No. 75263 +1cc to Mr.G.Baskar, Advocate, S.R.No. 75979 NR(CO)GN(12/11/2019) TCA.No.55 of 2016