TCA.No.292 of 2019 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.292 of 2019 Principal Commissioner of Income Tax-3, Coimbatore-18 Appellant Vs M/s.R.Easwaran HUF, Tirupur. Pin : 641605 ...Respondent APPEAL under Section 260A of Income Tax Act, 1961 against order dated 03.12.2018 made in ITA.No.591/Chny/2018 on file of Income Tax Appellate Tribunal, Chennai 'B' Bench for assessment year 2011-12. For Appellant: Mr.T.R.Senthilkumar, SSC assisted by Ms.K.G.Usharani, SC For Respondent: Mr.N.V.Balaji 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, Standing appearing for appellant Revenue and Mr.N.V.Balaji, learned counsel appearing for respondent. 1/4 http://www.judis.nic.in TCA.No.292 of 2019 2. This appeal, filed by Revenue under Section 260A of Income Tax Act, 1961 (for short, Act) is directed against order dated 03.12.2018 made in ITA.No.591/Chny/2018 on file of Income Tax Appellate Tribunal, Chennai 'B' Bench (for brevity, Tribunal) for assessment year 2011-12. 3. appeal has been admitted on 03.6.2019 on following substantial questions of law : i. Whether, on facts and in circumstances of case and in law, Income Tax Appellate Tribunal is justified in deleting penalty levied under Section 271(1)(c), when it is first year of finance business by assessee and hence, write off claim is outside purview of Section 36(1)(vii) read with Section 36(2) and as such tantamount to filing of inaccurate particulars ? ii. Whether Appellate Tribunal was justified in deleting penalty when assessee failed to substantiate that loss arose in ordinary course of carrying on finance business, but ostensibly claiming it as 'bad debts' after closure of books for relevant previous year falls squarely within ambit of furnishing inaccurate particulars ? iii. Whether Appellate Tribunal is right in deleting penalty for furnishing inaccurate 2/4 http://www.judis.nic.in TCA.No.292 of 2019 particulars, when write off was not reflected in books on date of survey on 21.7.2011 after closure of books on 31.3.2011 and hence, write off is not in regular course of maintenance of books, is afterthought to reduce liability ? And iv. Whether, on facts and circumstances of case, Appellate Tribunal is correct in canceling penalty levied under Section 271(1)(c) of Act in following Supreme Court judgment in case of CIT Vs. Reliance Petroproducts P. Ltd. [reported in 322 ITR 158], which is clearly distinguishable to facts of assessee's case? 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 3/4 http://www.judis.nic.in TCA.No.292 of 2019 T.S.SIVAGNANAM,J AND V.BHAVANI SUBBAROYAN,J RS framed 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 To Income Tax Appellate Tribunal, Chennai 'B' Bench. TCA.No.292 of 2019 4/4 http://www.judis.nic.in Principal Commissioner of Income-tax-3, Coimbatore v. R.Easwaran HUF