Principal Commissioner of Income-tax 2, Chennai v. H.M.Brothers Ltd
[Citation -2020-LL-0721-1]

Citation 2020-LL-0721-1
Appellant Name Principal Commissioner of Income-tax 2, Chennai
Respondent Name H.M.Brothers Ltd.
Court HIGH COURT OF MADRAS
Relevant Act Income-tax
Date of Order 21/07/2020
Judgment View Judgment
Keyword Tags original assessment order • reassessment proceedings • concealment of income • depreciation claim • monetary limit • satisfaction • tax effect • penalty
Bot Summary: For appellant : Mr.Karthik Ranganathan, Senior Standing Counsel For respondent : No appearance JUDGMENT The Court was held by Video Conference, as per the Resolution of the Full Court dated 3 July 2020, by Judges at their respective residence and the counsel, staff of the Court appearing from their respective residences. This Tax Case Appeal has been filed by the Revenue, calling in question the correctness of the order passed by the Income Tax Appellate Tribunal, Income Tax Appellate Tribunal, Madras D Bench, in ITA No.331/Mds/2014, dated 29.04.2016, by raising the following substantial questions of law: 1. Whether on the facts and circumstances of the case and in law, the Tribunal was correct and justified in cancelling the penalty levied u/ s 271(I)(c) 2. Whether on the facts and circumstances of the case and in law, the Tribunal was right and justified in holding that AO exceeded his jurisdiction in initiating the penalty proceedings u/s 271(1)(c) when the original assessment order was set-aside by CIT(A) and in the consequential order passes u/s 143(3) r.w.s 250, the AO rightly initiated the penalty on satisfaction of concealment of income during such proceedings 3. Whether on the facts and circumstances of the case and in law, the Tribunal was right and justified in deleting the penalty levied on bogus depreciation claim when assessee failed to substantiate the claim by producing at least the invoice evidencing purchase of such asset 2. When the matter was taken up for hearing, the learned Standing Counsel brought to our notice, the Circular instruction issued by the Central Board of Direct Taxes vide Circular No.17/2019 dated 8th August 2019, wherein, it is stipulated that appeals shall not be filed/pursued by the Department before the High Court in cases where the tax effect does not exceed Rs.1,00,00,000/-. In the instant case, the tax effect is said to be less than the monetary limit imposed and therefore, the Appeal filed by the Revenue is dismissed as withdrawn, keeping open the substantial questions of law for determination in appropriate cases.


Order dt.21.07.2020 TCA No.358 of 2017 1/4 IN HIGH COURT OF JUDICATURE AT MADRAS DATED: 21.07.2020 CORAM HON'BLE DR.JUSTICE VINEET KOTHARI AND HON'BLE MR.JUSTICE KRISHNAN RAMASAMY TCA No.358 of 2017 Principal Commissioner of Income Tax 2, No.121, Mahathma Gandhi Road, Chennai 34 ... Appellant vs. M/s.H.M.Brothers Ltd., 13, Errabulla Street, Chennai ... Respondent Prayer ::- Appeal filed against order of Income Tax Appellate Tribunal, Madras D Bench, dated 29.04.2016 in ITA No.331/Mds/2014. For appellant : Mr.Karthik Ranganathan, Senior Standing Counsel For respondent : No appearance JUDGMENT (Made by DR.VINEET KOTHARI, J.) Court was held by Video Conference, as per Resolution of Full Court dated 3 July 2020, by Judges at their respective residence and counsel, staff of Court appearing from their respective residences. http://www.judis.nic.in Order dt.21.07.2020 TCA No.358 of 2017 2/4 2. This Tax Case Appeal has been filed by Revenue, calling in question correctness of order passed by Income Tax Appellate Tribunal, Income Tax Appellate Tribunal, Madras D Bench, in ITA No.331/Mds/2014, dated 29.04.2016, by raising following substantial questions of law: "1. Whether on facts and circumstances of case and in law, Tribunal was correct and justified in cancelling penalty levied u/ s 271(I)(c) ? 2. Whether on facts and circumstances of case and in law, Tribunal was right and justified in holding that AO exceeded his jurisdiction in initiating penalty proceedings u/s 271(1)(c) when original assessment order was set-aside by CIT(A) and in consequential order passes u/s 143(3) r.w.s 250, AO rightly initiated penalty on satisfaction of concealment of income during such proceedings ? 3. Whether on facts and circumstances of case and in law, Tribunal erred in holding that AO cannot initiate penalty in reassessment proceedings especially when original assessment order does not exist as it was set-aside by CIT(A)directing AO to pass fresh speaking order and whether such finding by Tribunal is perverse both in eyes of law and facts? http://www.judis.nic.in Order dt.21.07.2020 TCA No.358 of 2017 3/4 4. Whether on facts and circumstances of case and in law, Tribunal was right and justified in deleting penalty levied on bogus depreciation claim when assessee failed to substantiate claim by producing at least invoice evidencing purchase of such asset? 2. When matter was taken up for hearing, learned Standing Counsel brought to our notice, Circular instruction issued by Central Board of Direct Taxes vide Circular No.17/2019 dated 8th August 2019, wherein, it is stipulated that appeals shall not be filed/pursued by Department before High Court in cases where tax effect does not exceed Rs.1,00,00,000/- (Rupees One Crore). 3. In instant case, tax effect is said to be less than monetary limit imposed and therefore, Appeal filed by Revenue is dismissed as withdrawn, keeping open substantial questions of law for determination in appropriate cases. No costs. (V.K.,J.) (K.R.,J.) 21.07.2020 kpl/tar http://www.judis.nic.in Order dt.21.07.2020 TCA No.358 of 2017 4/4 DR.VINEET KOTHARI, J. and KRISHNAN RAMASAMY, J. (tar) TCA No.358 of 2017 21.07.2020 http://www.judis.nic.in Principal Commissioner of Income-tax 2, Chennai v. H.M.Brothers Ltd
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