The Commissioner Of Income Tax,Chennai v. M/S.lakshminaryanan Ganesh

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED: 21.07.2020 THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMandTHE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN The Commissioner of Income Tax,Chennai. .. Appellant versus M/s.Lakshminaryanan Ganesh,No.132, Cathedral Road,Chennai - 600 086. .. Respondent Tax Case Appeal filed under Section 260A of the Income TaxAct, 1961, against the order made in ITA No.333/Mds/2017 dated20.06.2017 passed by the Income Tax Appellate Tribunal Madras'B' Bench, for the Assessment Year 2007-08 aganist the Appellateorder of the Commissioner of Income Tax(Appeals)-3, Chennai-34,dated 30-9-2016 made in ITA No:04/CIT (A)-3/2013-14 for theAssessment Year 2007-08; and aganist the order of the AssistantCommissioner of Income-Tax,cCompany circle-V(3) Chennai, dated27-3-2013 made in PAN/GI.No: for the Assessment year2007-08. For Appellant: Mr.T.Ravikumar Senior Standing Counsel For Respondent : Mr.Vijayaraghavan for M/s.Subbaraya Aiyar Padmanabhan and RamamaniJUDGMENT T.S.SIVAGNANAM, J. We have heard Mr.T.Ravikumar, learned Senior Standing Counselappearing for the appellant/Revenue and Mr.Vijayaraghavan,learned Standing Counsel appearing for the respondent/assessee. 2. This appeal filed by the revenue under Section 260A of the https://hcservices.ecourts.gov.in/hcservices/ Income Tax Act, 1961 (the 'Act' for brevity), is directedagainst the order dated 20.06.2017 passed by the Income TaxAppellate Tribunal 'B' Bench, Madras, in ITA No.333/Mds/2017 forthe Assessment Year 2007-08. 3. The appeal was admitted on 14.06.2019 on the followingsubstantial questions of law :"(i) Whether the Tribunal was right in quashingthe reassessment proceeding which was initiatedwithin four year especially when the AO had notformed any opinion in respect of the long termcapital gains and the income of the assesseechargeable to tax had escaped assessment? (ii) Whether the finding of the Tribunal isproper especially when no evidence was placed by theassessee with regard to the listing of Private Ltd.Company especially when the assessee has receivedRs.2.35 Crores from the Public Limited Company viz.,a Rane Holding Ltd., in which he was one of thepromoter and therefore the transaction is liable tobe taxed u/sec.56(2)(vii) of the Income Tax Act?(iii) Whether the Tribunal was right in grantingrelief to the assessee especially when the assesseehas failed to substantiate the valuation of the sharetransferred with documentary evidence after the CIT (A) had held it was a sham transaction?" 4. The learned Senior Standing Counsel for theappellant/revenue submits that the above appeal is not pursuedby the Revenue on account of the low tax effect in terms ofCircular No.17/2019 dated 08.8.2019 issued by the Central Boardof Direct Taxes. By the said Circular, the monetary limit forfiling or pursuing an appeal before the High Court has beenincreased to Rs.1 Crore. It is further submitted that the taxeffect in this case is less than 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 is 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. Sd/- Assistant Registrar ars //True Copy// Sub Assistant Registrar To 1.The Commissioner of Income-Tax,Chennai. 2.The Income Tax Appellate Tribunal,Madras 'B' Bench. 3.The Commissioner of Income-Tax(Appeals)-3,Chennai-34. 4.The Assistant Commissioner of Income Tax,Companycircle-V(3),Chennai. +1cc to Mr.T.Ravi Kumar, Advocate, Sr.No.25004 +1cc to Mr.Subbaraya Aiyar, Advocate, Sr.No.25012 TCA No.415 of 2018 PP(CO)GS(12/08/2020)