Madras High Court
The Commissioner Of Income Tax vs M/S.Indian Syntans Investments P Ltd on 17 June, 2025
TCA No.398 of 2013
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED: 17.06.2025
CORAM
THE HON'BLE MR.K.R.SHRIRAM, CHIEF JUSTICE
AND
THE HON'BLE MR.JUSTICE SUNDER MOHAN
TCA No.398 of 2013
The Commissioner of Income Tax,
Chennai : Appellant
versus
M/s.Indian Syntans Investments P Ltd.,
No.12, Third Main Road,
Kasturba Nagar,
Adyar,
Chennai 600 020 : Respondent
Prayer: Appeal filed against the order of the Income Tax Appellate Tribunal,
Madras “D” Bench, Chennai, dated 21.09.2021 in I.T.A.11 12/Mds/2012.
For Appellant : Mr.T.Ravi Kumar
For Respondent : Mr.R.Sivaraman
Page 1 of 6
https://www.mhc.tn.gov.in/judis ( Uploaded on: 19/06/2025 04:05:24 pm )
TCA No.398 of 2013
JUDGMENT
(Delivered by the Hon'ble Chief Justice)
The assessee is an investment company engaged in the business of
investing and also trading in shares and securities. The assessment for AY
2007-08 was completed under Section 143(3) of the Income Tax Act, 1961,
(for short, 'the Act') determining the total income of the assessee at
Rs.2,95,54,662/-. The Commissioner of Income Tax thereafter issued a
notice dated 6 March 2012 under Section 263 of the Act. This was followed
by an order dated 30 March 2012. Aggrieved by the order, assessee
preferred an appeal before the Income Tax Appellate Tribunal. The
Appellate Tribunal, by an order pronounced on 21 September 2012,
allowed the appeal and quashed and set aside the order dated 30 March
2012 passed under Section 263 of the Act. In fact, the Appellate Tribunal
has also made certain observations against the concerned Commissioner of
Income Tax for issuing the notice under Section 263 of the Act. Against this
order, the present appeal under Section 260-A of the Act has been
preferred.
https://www.mhc.tn.gov.in/judis ( Uploaded on: 19/06/2025 04:05:24 pm )
2. On 26 August 2013, the appeal was admitted on the following
three substantial questions of law:
“1. Whether on the facts and in the
circumstances of the case, the Income Tax Appellate
Tribunal was right in holding that the revision order
passed under Section 263 is bad in law and therefore
set aside the same?
2. Whether the disallowance under Section 14A
is to be taken into account while computing exempt
income earned by the assessee during the previous
year as the assessee had earned income including long
term capital under Section 10(38) and 10(36) of the
Act?
3. Whether the trading profit is to be reduced
at the final point as the capital loss on sale of
investment was adjusted against the business profit
made by the assessee?”
3. In our view, we do not have to go into the details to answer the
substantial questions of law. The reason being, even before the notice under
Section 263 of the Act was issued, the audit had raised certain queries on
the assessment order passed. These queries were replied to by the Assistant
Commissioner of Income Tax, who was the Assessing Officer, vide a
communication dated 25 August 2010; where the last paragraph reads as
under:
“In view of the facts of the case as discussed
above there is no legal infirmity in the assessment
order. The observation of the Audit officer is purely
https://www.mhc.tn.gov.in/judis ( Uploaded on: 19/06/2025 04:05:24 pm )
based on certain presumption and surmises and is not
supported by any provisions of the Act. In view of the
above, the audit objection may please be dropped.”
4. Subsequently, the Deputy Commissioner of Income Tax, Company
Circle, vide a communication dated 5 May 2014, addressed to the office of
the Director General of Audit (Central), after referring to the order passed
under Section 263 of the Act and the order passed by the Income Tax
Appellate Authority that is impugned in this appeal, has stated, “The
objections raised in this case vide the reference may kindly be dropped/
treated as settled”. Subsequently, the office of the Principal Director of
Audit (Central), Chennai, by a communication dated 7 October 2021,
addressed to the Commissioner of Income Tax-I, Chennai, has observed that
this case is not being pursued further and be closed.
5. In such circumstances, in our view, it is nothing but an academic
exercise to proceed to answer the substantial questions of law framed, by
spending our precious judicial time.
https://www.mhc.tn.gov.in/judis ( Uploaded on: 19/06/2025 04:05:24 pm )
6. The appeal stands disposed of accordingly. There will be no order
as to costs.
(K.R.SHRIRAM, CJ.) (SUNDER MOHAN, J.)
17.06.2025
Index : Yes/No
Neutral Citation : Yes/No
tar
To
1.The Commissioner of Income Tax,
Chennai
2.The Income Tax Appellate Tribunal,
Madras “D” Bench, Chennai
https://www.mhc.tn.gov.in/judis ( Uploaded on: 19/06/2025 04:05:24 pm )
THE HON'BLE CHIEF JUSTICE
AND
SUNDER MOHAN, J.
(tar)
17.06.2025
https://www.mhc.tn.gov.in/judis ( Uploaded on: 19/06/2025 04:05:24 pm )
