AWN Agro Pvt. Ltd., 2014-15 V. DCIT, CIr.1(1)(1), Ahmedabad

CO 53/AHD/2018

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 5299 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 month(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 29-01-2019
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2014-2015
• Appeal Filed On: 29-11-2018
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: ERA KAPOOR
• Keywords: Audit objection; Tax effect
• Section: 143(3)

Judgement Text

ITA NO.2108/AHD/2017& C.O. NO.53/AHD/2018 ASSESSMENT YEAR: 2014-15 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD A1 BENCH, AHMEDABAD [CORAM: JUSTICE P P BHATT, PRESIDENT AND PRAMOD KUM AR, VICE PRESIDENT] ITA NO.2108/AHD/2017 ASSESSMENT YEAR: 2014-15 DY. COMMISSIONER OF INCOME TAX, CIRCLE-1(1)(1), AHMEDABAD. ...... ...... APPELLANT VS. AWN AGRO PVT. LTD., .... RESPONDENT FORTUNE HOUSE, NR, NAVRANGPURA RAILWAY CROSSING, AHMEDABAD 380 009. [PAN: AAJCA 3256 G] C.O. NO.53/AHD/2018 (IN ITA NO.2108/AHD/2017) ASSESSMENT YEAR: 2014-15 AWN AGRO PVT. LTD., ....AP PELLANT FORTUNE HOUSE, NR, NAVRANGPURA RAILWAY CROSSING, AHMEDABAD 380 009. [PAN: AAJCA 3256 G] VS. DY. COMMISSIONER OF INCOME TAX, CIRCLE-1(1)(1), AHMEDABAD. .. .. RESPONDENT APPEARANCES BY MUDIT NAGPAL FOR THE REVENUE ERA KAPOOR FOR THE ASSESSEE DATE OF CONCLUDING THE HEARING : 29.01.2019 DATE OF PRONOUNCEMENT : 29.01.2019 O R D E R PER BENCH: ITA NO.2108/AHD/2017& C.O. NO.53/AHD/2018 ASSESSMENT YEAR: 2014-15 PAGE 2 OF 3 1. BY WAY OF THIS APPEAL, THE APPELLANT ASSESSING O FFICER HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 24.07.2017, PASSED B Y THE LEARNED CIT(A)-1, AHMEDABAD, IN THE MATTER OF ASSESSMENT UNDER SECTIO N 143(3) OF THE INCOME-TAX ACT, 1961, FOR THE ASSESSMENT YEAR 2014-15, ON THE FOLLOWING GROUNDS :- THAT THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE DISALLOWANCE OF RS.60,44,418/- MADE ON THE GROUND THAT MARKET-TO -MARKET FOREIGN EXCHANGE LOSS IS NOTIONAL LOSS AND CANNOT B ALLOWED AS PER INSTRUCTION 3 OF 2010 OF CBDT. ON THE FACT AND IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, THE CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFFICER T O THE EXTENT MENTIONED ABOVE SINCE THE ASSESSEE HAS FAILED TO DISCLOSE HIS TRUE INCOME/BOOK PROFIT. THE APPELLANT PRAYS THAT THE ORDER OF CIT(A) ON THE ABOVE GROUNDS BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESORTED TO THE ABOVE EXTENT. 2. AT THE OUTSET, LEARNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE PRESENT APPEAL OF THE REVENUE NEED TO BE DISMISSED ON ACCOU NT OF LOW TAX EFFECT IN VIEW OF THE RECENT CBDT CIRCULAR NO.3 OF 2018 DATED 11.07.2 018. THE LEARNED DEPARTMENTAL REPRESENTATIVE FAIRLY ADMITTED THAT TH E TAX EFFECT INVOLVED IN THIS APPEAL IS LESS THAN THE LIMIT PRESCRIBED BY THE AFORESAID CBDT CIRCULAR. 3. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT PRIMA-FACIE THE APPEAL OF THE REVENUE IS NOT MAINTAINABLE IN VIEW OF THE CBDT CIRCULAR NO.3/2018 IN F.NO.279/MIS C.142/2007-ITJ (PT) DATED 11 TH JULY, 2018, VIDE WHICH IT HAS BEEN DECIDED BY THE B OARD THAT NO DEPARTMENTAL APPEALS SHOULD BE FILED BEFORE THE TRIBUNAL IF THE TAX EFFECT BY VIRTUE OF THE COMMISSIONER OF INCOME-TAX (APPEALS)S ORDER IS BEL OW RS. 20 LACS. THE BOARD HAS PROVIDED EXEMPTIONS AT CLAUSE (10) OF THE INSTRUCTI ONS WHEREIN IT HAS BEEN PROVIDED THAT THESE INSTRUCTIONS WILL NOT BE APPLICABLE, WHE RE THE CONSTITUTIONAL VALIDITY OF THE PROVISIONS OF AN ACT/RULE IS UNDER CHALLENGE OR WHE RE BOARDS ORDER, NOTIFICATION, INSTRUCTION OR CIRCULAR HAS BEEN HELD TO BE ILLEGAL OR WHERE REVENUE AUDIT OBJECTION IN THE CASE HAS BEEN ACCEPTED BY THE DEPARTMENT OR WHE RE THE ADDITION RELATES TO UNDISCLOSED FOREIGN ASSETS/BANK ACCOUNTS ETC. WE F IND THAT THE PRESENT CASE DOES NOT FALL WITHIN THE EXEMPTION CLAUSE AND THE TAX EF FECT IS LESS THAN RS.20 LACS. THEREFORE, THE PRESENT APPEAL IS NOT MAINTAINABLE A ND HENCE DISMISSED. 4. LEARNED DEPARTMENTAL REPRESENTATIVE STATES THE LIBERTY MAY KINDLY BE GIVEN TO POINT OUT, UPON NECESSARY FURTHER VERIFICATIONS, AND TO SEEK RECALL THE DISMISSAL OF APPEALS AND RESTORATION OF THE APPEALS IN THE CASES (I) IN WHICH IT CAN BE DEMONSTRATED THAT THE APPEALS ARE COVERED BY THE EX CEPTIONS (II) WHICH ARE INADVERTENTLY INCLUDED IN THIS BUNCH OF APPEALS, WH EREIN THE TAX EFFECT, IN TERMS OF THE CBDT CIRCULAR (SUPRA), EXCEEDS RS 20,00,000. NONE O PPOSES THIS PRAYER; WE ACCEPT THE SAME. WE MAKE IT CLEAR THAT THE APPELLANTS SHAL L BE AT LIBERTY TO POINT OUT THE CASES WHICH ARE WRONGLY INCLUDED IN THE APPEALS SO SUMMARILY DISMISSED, EITHER OWING TO WRONG COMPUTATION OF TAX EFFECT OR OWNING TO SUCH CASES BEING COVERED BY THE PERMISSIBLE EXCEPTIONS- OR FOR ANY OTHER REASON , AND WE WILL TAKE APPROPRIATE REMEDIAL STEPS IN THIS REGARD. ITA NO.2108/AHD/2017& C.O. NO.53/AHD/2018 ASSESSMENT YEAR: 2014-15 PAGE 3 OF 3 5. COMING TO THE CROSS OBJECTION FILED BY THE ASSES SEE, WHEN THIS CROSS OBJECTION WAS CALLED OUT FOR HEARING, LEARNED COUNS EL FOR THE ASSESSEE MS. ERA KAPOOR SUBMITTED THAT SHE DOES NOT WISH TO PRESS TH E CROSS OBJECTION DUE TO SMALLNESS OF THE AMOUNT INVOLVED. SHE, HOWEVER, PR AYED THAT LIBERTY MAY BE GIVEN TO TAKE UP THE ISSUE IN SUBSEQUENT YEARS, IF SO ADVISE D. 6. IN VIEW OF THE ABOVE, CROSS OBJECTION FILED BY T HE ASSESSEE IS TREATED AS DISMISSED. 7. IN THE RESULT, APPEAL FILED BY THE REVENUE AND C ROSS OBJECTION FILED BY THE ASSESSEE, BOTH ARE DISMISSED. PRONOUNCED IN THE OP EN COURT TODAY ON THE 29 TH DAY OF JANUARY, 2019. SD/- SD/- JUSTICE P P BHATT PRAMOD KUMAR (PRESIDENT) (VICE PRESIDENT) AHMEDABAD, DATED THE 29 TH DAY OF JANUARY, 2019 PBN/* COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD