M/s. Jitendra Sharma & Party, UDAIPUR V. ACIT, UDAIPUR

CO 19/JODH/2014

• Counselvise Citation: [2014] 123 COUNSELVISE.COM (IT) 0064 (ITAT-JODHPUR)
• Duration Of Justice: 21 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 01-10-2014
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 10-09-2014
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: JAI SINGH
• Keywords: Depreciation; Retrospective amendment; Tax effect
• Section: 148

Judgement Text

IN THE INCOME TAX APPELALTE TRIBUNAL : JODHPUR BENCH : JODHPUR BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND SHRI N.K. SAINI, ACCOUNTANT MEMBER. ITA NO. 407 /JODH/2014 (A.Y. 200 8 - 09 ) ACIT , CIRCLE - 2, UDAIPUR. VS. M/S. JITENDRA SHARMA & PARTY, BARMER JAISELMER GROUP, HO UDAIPUR, 101, VARDHAMAN COMPLEX, BHOPALPURA, UDAIPUR. (APPELLANT) PAN NO. AAAAJ 4862 A (RESPONDENT) C.O.NO. 19 /JODH/2014 (I.T.A.NO. 407/JODH/2014) (A.Y. 2008 - 09) M/S. JITENDRA SHARMA & PARTY, BARMER JAISELMER GROUP, HO UDAIPUR, 101, VARDHAMAN COMPLEX, BHOPALPURA, UDAIPUR. VS. ACIT, CIRCLE - 2, UDAIPUR. PAN NO. AAAAJ 4862 A (APPELLANT) (RESPONDENT) 2 ITA NO. 408/JODH/2014 (A.Y. 2008 - 09) ACIT, CIRCLE - 2, UDAIPUR. VS. M/S. SHYAM SUNDER & PARTY, HANUMAN G ARH GROUP , 424 PANCHRATAN COMPLEX, UDAIPUR. (APPELLANT) PAN NO. AA D A S 4 5 8 4 R (RESPONDENT) C.O.NO. 20/JODH/2014 ( ITA NO. 408/JODH/2014 ) (A.Y. 2008 - 09) M/S. SHYAM SUNDER & PARTY, HANUMAN GARH GROUP, 424 PANCHRATAN COMPLEX, UDAIPUR. VS. ACIT, CIRCLE - 2, UDAIPUR. PAN NO. AADAS 4584 R (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE . DEPARTMENT BY : SHRI JAI SINGH - D.R. DATE OF HEARING : 22 /0 9 /2014. DATE OF PRONOUNCEMENT : 01 / 1 0/2014. O R D E R 3 PER N.K. SAINI, A.M THE APPEALS BY THE DEPARTMENT AND THE CROSS OBJECTIONS BY THE ASSESSEES ARE DIRECTED AGAINST THE SEPARATE ORDERS EACH DATED 08/05/2014 OF LD. CIT(A) UDAIPUR . SINCE THE ISSUE INVOLVED IS COMMON AND THE APPEALS & THE CROSS OBJECTIONS WERE HEARD TOGETHER, SO THESE ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2 FIRST WE WILL DEAL WITH THE APPEAL IN I.T.A.NO. 407/JODH/2014 AND THE CROSS OBJECTION 19/JODH/2014 . THE GROUNDS RAISED IN THE APPEAL OF THE DEPARTMENT READ AS UNDER: - ON THE FACTS AND IN THE PRESENT CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DELETING THE DISALLOWANCE OF DEPRECIATION AMOUNTING TO RS. 1,60,005/ - IGNORING THE FACT: - 1. THAT NO SUCH ASSET WAS SHOWN AND NOTHING WAS MENTIONED IN SCHEDULE DPM, DOA, DEP, DCG OF THE ORIGINAL RETURN OF INCOME. 2. THAT THE SALE DEED SUBMITTED FOR CLAIMED PURCHASE OF VEHICLE WAS WRITTEN ON PLAIN PAPER AND SIGNED BY ONE MEMBER OF AOP ONLY AND HAVING NO REGISTRATION NUMBER AND THUS SAME DOES NOT HAVE ANY VALUE IN THE EYE OF RELEVANT LAW FOR REGISTRATION OF VEHICLE OR FOR OWNERSHIP OF VEHICLE . THAT THE APPELL ANT CRAVES TO ADD, AMEND, ALTER, DELETE OR MODIFY ANY OR ALL THE ABOVE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING. THE GROUNDS RAISED I N THE CROSS OBJECTION OF THE ASSESSEE READ AS UNDER: - 4 1. THE LD. COMMISSIONER OF INCOME TAX (APPEALS), UDAIPUR WAS JUSTIFIED IN DELETING THE DISALLOWANCE OF DEPRECIATION AMOUNTING TO RS. 160005.00 CLAIMED IN THE P & L ACCOUNT THAT DURING THE RELEVANT A.Y. 2007 - 2008, AFTER VERIFYING & CONSIDERING THE FACT THAT THE ASSESSEE RECTIFIED THE CLERICAL ERROR AT THE TIME OF FILING OF ORIGINAL IT RETURN ITR - 5 (THE SCHEDULE DPM, DOA, DEP & DCG WAS FILED NIL) IN THE IT RETURN FILED IN RESPONSE TO THE NOTICE U/S 148 OF THE IT ACT, 1961. THE LD. CIT (APPEALS), UDAIPUR ALSO VERIFIED & CONSIDERED THAT THE ASSESSEE PURCHASED THE VEHICLE OF RS. 1066700.00 ON 01 - 04 - 2007 AND PUT TO USE FOR ITS BUSINESS PURPOSES BEFORE 30 - 09 - 2007 I.E. FOR MORE THAN 180 DAYS. HENCE, THE ACTION OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS), UDAIPUR WAS JUSTIFIED & AS PER LAW. 2. THAT THE AS PER THE INSTRUCTION NO. 5/2014 DATED 10 - 07 - 2014 ISSUED BY CBDT WITH A VIEW TO REDUCING LITIGATION, THE MONETARY LIMITS FOR FILING OF APPEALS BY THE DEPARTMENT BEFORE INCOME TAX APPELLATE TRIBUNAL, HIGH COURTS AND SUPREME COURT, HAVE BEEN UPWARDLY REVISED. AS P ER THE AFORESAID INSTRUCTION, THE REVISED MONETARY LIMIT OF TAX EFFECT FOR APPEALS IN INCOME TAX MATTERS BEFORE APPELLATE TRIBUNAL IS RS. 400000.00 AND IN THE ASSESSEE AOP CASE, THE TAX EFFECT OF THE DISALLOWANCE MADE IS BELOW THE AFORESAID MONETARY LIMIT PRESCRIBED BY THE INSTRUCTION NO. 5/2014 DATED 10 - 07 - 2014. FURTHER, INSTRUCTIONS ISSUED BY CBDT INCLUDING THOSE PRESCRIBING THE MONETARY LIMIT OF TAX EFFECT FOR FILING THE APPEALS BEFORE THE TRIBUNAL, HIGH COURTS AND SUPREME COURT ARE BINDING ON THE IT A UTHORITIES. THEREFORE, IN VIEW OF CBDT INSTRUCTION, THE APPEAL FILED BY THE DEPARTMENT HAVING TAX EFFECT BELOW RS. 4 LAKH IS NOT MAINTAINABLE HENCE LIABLE TO BE DISMISSED. WE RELY UPON THE FOLLOWING JUDICIAL PRONOUNCEMENTS TO SUBSTANTIATE THE AFORESAID F ACTS: * ASSISTANT COMMISSIONER OF INCOME TAX VS. KAPOOR SINGH [(2008) 23 SOT 297 (DEL)] COMMISSIONER OF INCOME TAX VS. PITHWA ENGG. WORKS [(2005) 197 CTR (BOM) 655: (2005) 276ITR 519 (BOM)] COMMISSIONER OF INCOME TAX VS. CAMEO COLOUR CO. [(2002) 173 CTR (BOM) 255: (2002) 254 ITR 565 (BOM): (2002) 122 TAXMAN 336 (BOM)] CWT VS. EXECUTORS OF LATE D.T. UDESHI [(1992) 101 CTR (BOM) 290: (1991) 189 ITR 319 (BOM)] 5 ELLERMAN LINES VS. CIT [1972 CTR (SC) 71: (1971) 82 ITR 913 (SC)] K.P. VARGHESE VS. ITO [(1981) 24 CTR (SC) 358: (1981) 131 ITR 597 (SC)] NAVNIT LA L C. JAVERI VS. K.K. SEN, A AC [(1965) 56 ITR 198 (SC)] ASSISTANT COMMISSIONER OF INCOME TAX VS. RAJOO ENGINEERS LTD. [(2006) 102 TTJ (RAJKOT) 733: (2006) 100 ITD 555 (RAJKOT)] COMMISSIONER OF WEALTH TAX VS. S. ANNAMALAI [(2003) 181 CTR (MAD) 450: (2002) 258 ITR 675 (MAD): (2003) 133 TAXMAN 306] INCOME TAX OFFICER VS. BIR ENGG. WORKS [(2005) 93 TTJ (ASR)(S B ) 257: (2005) 94 ITD 164 (ASR)(S B )] 3. THE RESPONDENT PRAYS JUSTICE AND CROSS OBJECTIONS DESERVES TO BE ALLOWED. 4. THE RESPONDENT CRAVES LEAVE TO ADD, AMEND, ALTER MODIFY, DELETE AND OR CHANGE ALL OR ANY OF THE ABOVE GROUNDS OF CROSS OBJECTIONS ON OR BEFORE THE DATE OF HEARING. 3. DURING THE COURSE OF HEARING, N OBODY WAS PRESENT ON BEHALF OF THE ASSESSEE AND THE ADJOURNMENT APPLICATION MOVED BY THE LEARNED COUNSEL FOR THE ASSESSEE WAS REJECTED BECAUSE IT WAS NOTICED THAT THE TAX EFFECT IN THE APPEAL OF THE DEPARTMENT IS LESS THAN RS. 4 LAC AND IN THE CROSS OBJECTION, NO SPECIFIC RELIEF IS SOUGHT . 4. DURING THE COURSE OF HEARING, LD. D.R., ALTHOUGH SUPPORTED THE ORDER OF THE ASSESSING OFFICER, BUT COULD NOT CONTROVERT THIS FACT THAT TAX EFFECT IN THIS APPEAL OF THE DEPARTMENT IS LESS THAN RS.4,00,000/ - . 6 5 . AFTER CONSIDERING THE SUBMISSIONS OF THE LD. D.R. AND THE MATERIAL ON RECORD, IT IS NOTICED THAT SECTION 268A HAS BEEN INSERTED BY THE FINANCE ACT, 2008 WITH RETROSPECTIVE EFFECT FROM 01/04/99. THE PROVISIONS CONTAINED IN SECTION 268A READ AS UNDER: 268A. (1) THE BOARD MAY, FROM TIME TO TIME, ISSUE ORDERS, INSTRUCTIONS OR DIRECTIONS TO OTHER INCOME - TAX AUTHORITIES, FIXING SUCH MONETARY LIMITS AS IT MAY DEEM FIT, FOR THE PURPOSE OF REGULATING FILING OF APPEAL OR APPLICATIO N FOR REFERENCE BY ANY INCOME - TAX AUTHORITY UNDER THE PROVISIONS OF THIS CHAPTER. (2) WHERE, IN PURSUANCE OF THE ORDERS, INSTRUCTIONS OR DIRECTIONS ISSUED UNDER SUB - SECTION (1), AN INCOME - TAX AUTHORITY HAS NOT FILED ANY APPEAL OR APPLICATION FOR REFERENCE ON ANY ISSUE IN THE CASE OF AN ASSESSEE FOR ANY ASSESSMENT YEAR, IT SHALL NOT PRECLUDE SUCH AUTHORITY FROM FILING AN APPEAL OR APPLICATION FOR REFERENCE ON THE SAME ISSUE IN THE CASE OF ( A ) THE SAME ASSESSEE FOR ANY OTHER ASSESSMENT YEAR; OR ( B ) ANY OTHER ASSESSEE FOR THE SAME OR ANY OTHER ASSESSMENT YEAR. (3) NOTWITHSTANDING THAT NO APPEAL OR APPLICATION FOR REFERENCE HAS BEEN FILED BY AN INCOME - TAX AUTHORITY PURSUANT TO THE ORDERS OR INSTRUCTIONS OR DIRECTIONS ISSUED UNDER SUB - SECTION (1), IT SHALL NOT BE LAWFUL 7 FOR AN ASSESSEE, BEING A PARTY IN ANY APPEAL OR REFERENCE, TO CONTEND THAT THE INCOME - TAX AUTHORITY HAS ACQUIESCED IN THE DECISION ON THE DISPUTED ISSUE BY NOT FILING AN APPEAL OR APPLICATION FOR REFERENCE IN ANY CASE. (4) THE APPELLATE TRI BUNAL OR COURT, HEARING SUCH APPEAL OR REFERENCE, SHALL HAVE REGARD TO THE ORDERS, INSTRUCTIONS OR DIRECTIONS ISSUED UNDER SUB - SECTION (1) AND THE CIRCUMSTANCES UNDER WHICH SUCH APPEAL OR APPLICATION FOR REFERENCE WAS FILED OR NOT FILED IN RESPECT OF ANY C ASE. (5) EVERY ORDER, INSTRUCTION OR DIRECTION WHICH HAS BEEN ISSUED BY THE BOARD FIXING MONETARY LIMITS FOR FILING AN APPEAL OR APPLICATION FOR REFERENCE SHALL BE DEEMED TO HAVE BEEN ISSUED UNDER SUB - SECTION (1) AND THE PROVISIONS OF SUB - SECTIONS (2), (3 ) AND (4) SHALL APPLY ACCORDINGLY. ] 6 . IT IS NOT IN DISPUTE THAT THE BOARDS INSTRUCTION OR DIRECTIONS ISSUED TO THE OTHER INCOME - TAX AUTHORITIES ARE BINDING ON THOSE AUTHORITIES, THEREFORE, THE DEPARTMENT OUGHT NOT TO HAVE FILED THE APPEAL IN VIEW OF TH E ABOVE MENTIONED SECTION 268A SINCE THE TAX EFFECT IN THE INSTANT CASE IS LESS THAN THE AMOUNT PRESCRIBED FOR NOT FILING THE APPEAL. 7 . IT IS NOTICED THAT THE CBDT HAS ISSUED INSTRUCTION NO.5 OF 2014 DATED 10.07.2014, BY WHICH THE CBDT HAS REVISED THE 8 MONETARY LIMIT TO RS. 4,00,000/ - FOR FILING THE APPEAL BEFORE THE TRIBUNAL. 8 . KEEPING IN VIEW THE CBDT INSTRUCTION NO.5 OF 2014 DATED 10.07.2014 AND ALSO THE PROVISIONS OF SECTION 268A OF INCOME TAX ACT, 1961, WE ARE OF THE VIEW THAT THE REVENUE SHOULD NOT HAVE FILED THE INSTANT APPEAL BEFORE THE TRIBUNAL. WHILE TAKING SUCH A VIEW, WE ARE FORTIFIED BY THE FOLLOWING DECISIONS OF HON'BLE PUNJAB & HARYANA HIGH COURT: - 1. CIT V OSCAR LABORATORIES P. LTD (2010) 324 ITR 115 (P&H) 2. CIT V ABINASH GUPTA (2010) 327 I TR 619 (P&H) 3. CIT V VARINDERA CONSTRUCTION CO. (2011) 331 ITR 449 (P&H)(FB) 9 . SIMILARLY THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT V. DELHI RACE CLUB LTD. IN ITA NO.128/2008, ORDER DATED 03.03.2011 BY FOLLOWING THE EARLIER ORDER DATED 02.08.2010 IN ITA NO.179/1991 IN THE CASE OF CIT DELHI - III V. M/S. P.S. JAIN & CO. HELD THAT SUCH CIRCULAR WOULD ALSO BE APPLICABLE TO PENDING CASES. 9 10 . FROM THE RATIO LAID DOWN BY THE HONBLE DELHI HIGH COURT, IT I S CLEAR THAT THE INSTRUCTIONS ISSUED IN THE CIRCULARS BY CBDT ARE APPLICABLE FOR PENDING CASES ALSO. THEREFORE, BY KEEPING IN VIEW THE RATIO LAID DOWN IN THE AFORESAID REFERRED TO CASES, WE ARE OF THE CONSIDERED VIEW THAT INSTRUCTION NO.5/14 DATED 10.07.2 014 ISSUED BY THE CBDT ARE APPLICABLE FOR THE PENDING CASES ALSO AND IN THE SAID INSTRUCTIONS, MONETARY TAX LIMIT FOR NOT FILING THE APPEAL BEFORE THE ITAT IS RS. 4.00 LAKHS. 11 . IN VIEW OF THE ABOVE, WITHOUT GOING INTO MERITS OF THE CASE, WE DISMISS THE APPEAL S FILED BY THE REVENUE. 1 2 . IN TH E CROSS OBJECTION , THE ASSESSEE SUPPORTED THE ORDER OF THE LD. CIT(A) AND ALSO MENTIONED THAT THE DEPARTMENT OUGHT NOT TO HAVE FILED THIS APPEAL HAVING TAX EFFECT BELOW RS. 4 LAC. SINCE THE APPEAL OF THE DEPARTMENT HAS BEEN DISMISSED, THIS CROSS OBJECTION BECOMES INFRUCTUOUS . 13 IN I.T.A.NO. 408/JODH/2014 AND C.O.NO. 20/JODH/2014 SIMILAR GROUNDS HAVE BEEN RAISED AS WERE IN I.T.A.NO. 10 407/JODH/2014 & C.O.NO. 20/JODH/2014 , THE ONLY DIFFERENCE IS IN THE AMOUNT OF DELETION OF ADDITION MADE BY THE ASSESSING OFFICER. THEREFORE, OUR FINDINGS GIVEN IN THE FORMER PART OF THIS ORDER SHALL APPLY MUTATIS - MUTANDIS . 14 IN THE RESULT, APPEAL S OF THE REVENUE STAND DISMISSED AND THE CROSS OBJECTIONS OF THE ASSESSEES ARE DISMISSED AS INFRUCTUOUS . ( ORDER PRONOUNCED IN THE OPEN COURT ON 01 . 1 0.2014 ) S D/ - SD/ - (HARI OM MARATHA) (N.K.SAINI) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED : 01 ST OCTOBER , 2014 VR/ - COPY TO: THE APPELLANT THE RESPONDENT THE CIT BY ORDER THE CIT(A) THE DR SR. PRIVATE SECRETARY, ITAT, JODHPUR