The Commissioner Of Income Tax, Chennai v. M/S.vkc Credit And Forex Services Pvt. Ltd., Jeyamkondar Apartments, Unit

IN THE HIGH COURT OF JUDICATURE AT MADRASDATE: 22.03.2021 CORAM: THE HON'BLE MR. JUSTICE M.DURAISWAMYAND THE HON'BLE MRS.JUSTICE T.V.THAMILSELVI T.C.A.No.57 of 2015 The Commissioner of Income Tax,Chennai. ... Appellant/RespondentVs. M/s.VKC Credit and Forex Services Pvt. Ltd.,Jeyamkondar Apartments,Unit No.1B, 1[st] Floor,Alwarpet, Chennai – 600 018. ... Respondent/Appellant Appeal preferred under Section 260A of the Income Tax Act,1961, against the order of the Income Tax Appellate Tribunal,Madras, "B" Bench, dated 08.08.2014 in I.TA.No.639/Mds/2014Assessment Year 2007-08. Against the order of the Commissioner of Income Tax(Appeals)-II in ITA.No.973/2013-14 dt.31.10.2013 for theassessment year 2007-08 against the order of Deputy Commissionerof Income Tax Company Circle III(4), Chennai, GIR.No/PAN-39-V/ dt.21.12.09 for the assessment year 2007-08. For Appellant : Mr.M.Swaminathan, Senior Standing Counsel For Respondent : Mr.M.P.Senthil Kumar JUDGMENT (Judgment was delivered by M.DURAISWAMY, J.)We have heard Mr.M.Swaminathan, learned Senior StandingCounsel for the appellant/Revenue and Mr.M.P.Senthil Kumar,learned counsel for the respondent/assessee. 2.The appeal, filed by the Revenue under Section 260A of theIncome Tax Act, 1961 (for short, the Act) is directed againstthe order dated 08.08.2014 made in I.TA.No.639/Mds/2014 on thefile of the Income Tax Appellate Tribunal, Chennai, "B" Bench(for brevity, the Tribunal) for the Assessment Year 2007-08. https://hcservices.ecourts.gov.in/hcservices/ 3.The appeal was admitted on 10.03.2015 on the followingsubstantial questions of law: “1)Whether on the facts and in thecircumstances of the case, the Tribunal was rightin law in holding that provisions of Section 40a(ia) are applicable only to the amount of theexpenditure which are payable as of 31[st] March ofthe relevant previous year and it cannot beinvoked to disallow expenditure which had beenactually paid during the previous year for whichno tax had been deducted at source?2)Is not the finding of the Tribunal bad,especially when the assessee has not deducted TDSin respect of rent paid which would automaticallywarrant disallowance under Section 40(a)(ia)?3)Whether the term payable would include theamount which are paid during the previous year oronly those that are outstanding as on 31[st] ofMarch? 4)Whether on the facts and circumstances ofthe case, the Tribunal was right in treating theamount payable as distinct from the amount paidfor the purpose of provisions of Section 40(a)(ia)?” 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 08.08.2019 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 these cases areless than the threshold limit. 5.In the light of the said submissions, the above Tax CaseAppeal is dismissed as withdrawn on account of the Low TaxEffect. The substantial questions of law framed are left open.In the event the tax effect in this case is above the thresholdlimit fixed in the said Circular, liberty is granted to theRevenue to make a mention to this Court to restore the appeal tobe heard and decided on merits. No costs. Sd/- Assistant Registrar //True Copy// Sub Assistant Registrar va https://hcservices.ecourts.gov.in/hcservices/ To 1.The Income Tax Appellate Tribunal, Chennai, "B" Bench 2.The Commissioner of Income Tax(Appeals)-II, Chennai. 3.The Deputy Commissioner of Income Tax, Company Circle III(4), Chennai. Company Circle III(4), Chennai. +1 cc to Mr.M.Swaminathan, Advocate, S.R.No.18577 T.C.A.No.57 of 2015 AAB(CO)KM(16/04/2021)