TCA.No.244 of 2017 In High Court of Judicature at Madras Dated : 06.7.2020 Coram : Honourable Mr.Justice T.S.SIVAGNANAM and Honourable Mrs.Justice V.BHAVANI SUBBAROYAN Tax Case Appeal No.244 of 2017 Commissioner of Income Tax-3, Coimbatore-18 ...Appellant Vs M/s.Noyyal Common Effluent Treatment Company Ltd., Tirupur-641601. ...Respondent APPEAL under Section 260A of Income Tax Act, 1961 against order dated 26.10.2016 made in ITA.No.2068/Mds/2016 on file of Income Tax Appellate Tribunal, Chennai 'C' Bench for assessment year 2007-08. For Appellant: Mr.T.R.Senthilkumar, SSC assisted by Ms.K.G.Usharani, SC For Respondent: Mr.R.Sivaraman Judgment was delivered by T.S.Sivagnanam,J We have heard Mr.T.R.Senthilkumar, learned Senior Standing Counsel, assisted by Ms. K.G.Usharani, learned Standing Counsel appearing for appellant Revenue and Mr.R.Sivaraman, learned counsel appearing for 1/4 http://www.judis.nic.in TCA.No.244 of 2017 respondent. 2. This appeal, filed by Revenue under Section 260A of Income Tax Act, 1961 (for short, Act) is directed against order dated 26.10.2016 made in ITA.No.2068/Mds/2016 on file of Income Tax Appellate Tribunal, Chennai 'C' Bench (for brevity, Tribunal) for assessment year 2007-08. 3. Revenue filed this appeal by raising following substantial questions of law : i. Whether, on facts and in circumstances of case, Appellate Tribunal is right in law in deleting disallowance of Rs.1,72,24,412/- being interest received by assessee from deposits made and assesable as income under head 'income from other sources' ? And ii. Whether, on facts and in circumstances of case, Tribunal is justified in allowing interest paid on loans, which is pre-operational expense, as deduction against interest earned from deposits, which is separately assessable under head 'income from other sources ? And iii. Whether Tribunal is right in stating that no evidence was brought on record by Revenue to prove that deposits are placed with UTI from surplus funds, with intention to earn interest income, when assessee 2/4 http://www.judis.nic.in TCA.No.244 of 2017 company had not commenced operation and as such, there was no computation of business income or loss incurred by assessee company in relevant accounting year? And iv. Whether, on facts and in circumstances of case, Tribunal is right in law in not distinguishing that object of assessee company was to start effluent treatment plant and not to earn interest income? 4. learned Senior Standing Counsel for appellant submits that above appeal is not pursued by Revenue on account of low tax effect in terms of Circular No.17/2019 dated 08.8.2019 issued by Central Board of Direct Taxes. By said Circular, monetary limit for filing or pursuing appeal before High Court has been increased to Rs.1 Crore. It is further submitted that tax effect in this case is less than threshold limit. 5. In light of said submissions, above tax case appeal is dismissed on account of low tax effect. substantial questions of law raised are left open. In event tax effect is above threshold limit fixed in said circular, liberty is granted to Revenue to make mention to this Court to restore appeal to be heard and decided on merits. No costs. 06.7.2020 RS 3/4 http://www.judis.nic.in TCA.No.244 of 2017 T.S.SIVAGNANAM,J AND V.BHAVANI SUBBAROYAN,J RS To Income Tax Appellate Tribunal, Chennai 'C' Bench. TCA.No.244 of 2017 06.7.2020 4/4 http://www.judis.nic.in Commissioner of Income-tax-3, Coimbatore v. Noyyal Common Effluent Treatment Company Ltd