Commssr.Of Income Taxii,Hyd vs Infotech Enterprises Ltd.Hyd
2022 Latest Caselaw 4616 Tel

          THE HON'BLE THE CHIEF JUSTICE UJJAL BHUYAN
                                          AND
           THE HON'BLE SRI JUSTICE C.V.BHASKAR REDDY
                          I.T.T.A. No.90 of 2003
JUDGMENT:      (Per the Hon'ble the Chief Justice Ujjal Bhuyan)



     Heard       Mr.       B.Narsimha              Sarma,               learned    counsel

representing      Ms.       K.Mamata             Chowdary,               learned    Senior

Standing Counsel for Income Tax Department appearing for

the appellant and Mr. Challa Gunaranjan, learned counsel

for the respondent.

2. This appeal under Section 260A of the Income Tax Act,

1961, has been filed against the order dated 31.05.2002

passed by the Income Tax Appellate Tribunal, Hyderabad

Bench 'B', Hyderabad (Tribunal) in I.T.A.No.610/Hyd/2000

for the assessment year 1997-98.

3. In the appeal, the following substantial questions of law

have been proposed:

"A) Whether the Appellate Tribunal is justified in holding that 'net interest' and not 'gross interest' should be deducted from 'business profit' for the purpose of computation of relief U/s. 80HHE of the I.T.Act ? B) Whether the Appellate Tribunal is justified in holding that net interest alone should form the basis for

computation of 'business profit' without there being a finding about the nexus of interest receipts and interest payments ?

4. On 14.07.2003, the appeal was admitted.

5. In the hearing today, we have perused the assessment

order dated 30.03.2000. We find therefrom that the taxable

income of the respondent was determined at Rs.89,63,930.00

and quantum of tax to be paid was assessed at

Rs.22,55,320.00.

6. Central Board of Direct Taxes (CBDT) has issued

Circular No.17 of 2019, dated 08.08.2019, amending the

previous Circular No.3 of 2018, dated 11.07.2018, by further

enhancing the monetary limits for filing appeals by the

Income Tax Department before the Income Tax Appellate

Tribunals, High Courts and Supreme Court as a measure for

reducing litigation. In paragraph 2 of the said circular we

find that the monetary limit fixed for filing an appeal before

the High Court is Rs.1.00 crore.

7. In the instant appeal, tax effect is of

Rs.22,55,320.00, which is well below the monetary limit.

8. Therefore, the appeal filed by the Department is

dismissed in terms of the aforesaid Circular No.17 of 2019,

dated 08.08.2019. However, if the appeal comes within the

exception under paragraph 10 of Circular No.3 of 2018, it

would be open to the Income Tax Department to seek revival

of the appeal.

Miscellaneous applications pending, if any, shall stand

closed. However, there shall be no order as to costs.

______________________________________ UJJAL BHUYAN, CJ

______________________________________ C.V.BHASKAR REDDY, J 14.09.2022 Lur