Madoorie Tea Estate Pvt. Ltd., Kolkata V. ITO, Ward - 10(1), Kolkata, Kolkata

CO 72/KOL/2010

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8553 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 11 month(s) 6 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 24-05-2013
• Appeal Filed By: Assessee
• Bench Allotted: A
• Assessment Year: 2006-2007
• Appeal Filed On: 18-06-2010
• Court: TRIBUNAL
• Department Lawyers: RAJESH KUMAR JCITSR
• Assessee Lawyers: SWETA GHATAK
• Keywords: Tax effect
• Section: 260A

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL, BENCH A , KOLKATA [ () . .. . . .. . , ,, , , !' ##$ %& ##$ %& ##$ %& ##$ %& ] ]] ] [BEFORE HONBLE SRI K.K.GUPTA, AM & HONBLE SRI GEORGE MATHAN, JM] '( '( '( '( /ITA NO.1056/KOL/2010 )&* !+,/ ASSESSMENT YEAR : 2006-07 (%. / APPELLANT ) - !& - ( 01%. /RESPONDENT) I.T.O., WARD-10(1) -VERSUS- MADOORIE TEA ESTATE P VT. LTD. KOLKATA KOLKATA (PAN: AAECM 5172 G ) C.O. NO.72/KOL/2010 '( '( '( '( /A/O ITA NO.1056/KOL/2010 )&* !+,/ ASSESSMENT YEAR : 2006-07 (%. / CROSS OBJECTOR ) ( 01%. /RESPONDENT) MADOORIE TEA ESTATE PVT. LTD.. - !& - I.T.O., WARD-10(1) KOLKATA -VERSUS- KOLKATA (PAN: AAECM 5172 G) %. 2 3 / FOR THE DEPARTMENT SHRI RAJESH KUMAR, JCIT,SR.DR 01%. 2 3 / FOR THE ASSESSEE SMT.SWETA GHATAK, ADVOCATE &!4 2 5 /DATE OF HEARING : 24.05.2013 6+ 2 5 /DATE OF PRONOUNCEMENT : 24.05.2013 7 / ORDER PER BENCH ITA NO.1056/KOL/2010 IS AN APPEAL FILED BY THE REVE NUE AND C.O. NO.72/KOL/2010 IS A CROSS OBJECTION FILED BY THE AS SESSEE AGAINST THE ORDER OF LD. C.I.T.(A)-XII.. KOLKATA IN APPEAL NO.352/XII/10(4)/ 08-09 DATED 23.02.2010 FOR ASSESSMENT YEAR 2006-07. 2. SHRI RAJESH KUMAR, JCIT, SR DR REPRESENTED ON BEHALF OF THE REVENUE AND SMT.SWETA GHATAK, ADVOCATE REPRESENTED ON BEHALF O F THE ASSESSEE. ITA NO.1056/KOL/2010 & C.O.NO.72/KOL/2 010 ITO VS MADOORIE TEA ESTATE PVT.LTD. A.YR.2006-07 2 3. AT THE TIME OF HEARING IT WAS SUBMITTED BY THE LD. AR THAT THE ASSESSEE WISHES TO WITHDRAW ITS CROSS OBJECTION TO WHICH THE LD. DR DID NOT HAVE ANY OBJECTION. CONSEQUENTLY THE CROSS OBJECTION FILED BY THE ASSES SEE STANDS DISMISSED. IT WAS FURTHER SUBMITTED BY THE LD. AR THAT IN RESPECT OF THE REVENUES APPEAL THE TAX EFFECT WAS BELOW RS.3 LAKHS. IT WAS THE SUBMISSION THAT TH E APPEAL WAS IN RELATION TO FRINGE BENEFIT TAX AND AS PER SECTION 115 WE OF THE ACT TH E FBT WAS AN ADDITIONAL INCOME TAX. IT WAS THE SUBMISSION THAT AS THE TAX EFFECT W AS BELOW RS.3 LAKHS THE APPEAL OF THE REVENUE IS LIABLE TO BE DISMISSED. IN REPLY THE LD. DR VEHEMENTLY SUPPORTED THE ORDER OF THE AO. 4. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. A PERU SAL OF SECTION 115WE CLEARLY SHOWS THAT THE FBT IS AN ADDITIONAL INCOME TAX. HOW EVER, AS IT IS NOTICED THAT THE TAX EFFECT IN THIS CASE IS ONLY RS.2,21,361/- WHICH IS LESS THAN THE MONETARY LIMIT PRESCRIBED BY THE CBDT FOR PERUSING THE APPEAL BEFO RE I.T.A.T. IT APPEARS THAT THE TAX EFFECT INVOLVED IN THIS CASE IS BELOW RS.3 LAKHS. S INCE THE TAX EFFECT IS LESS THAN RS. 3 LAKHS AS PER CBDT INSTRUCTION NO.3/2011(F.NO.279/MI SE/142/2007-ITJ) DATED 9.2.2011 WHEREIN IT HAS BEEN ENHANCED THE LIMITS FO R FILING OF APPEALS BEFORE THE TRIBUNAL TO RS.3 LAKHS THE REVENUES APPEAL IS LIAB LE TO BE DISMISSED IN LIMINE. IN VIEW OF THE LATEST ORDER OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS DELHI RACE CLUB IN ITA NO.128/2008 WHEREIN THE HONBLE HI GH COURT OPINED THAT THAT THE CIRCULAR WOULD ALSO APPLY TO THE PENDING CASES. 5 THE LD. DR APPEARING ON BEHALF OF THE REVENUE CON TENDED THAT IN THIS SAID CIRCULAR IT WAS SPECIFICALLY MENTIONED AT PARA 11 T HAT THE CIRCULAR IS EFFECTIVE FOR THE APPEALS FILED SUBSEQUENT TO THE SPECIFIC DATE IN TH E CIRCULAR. SINCE THIS APPEAL HAS BEEN FILED PRIOR TO THE ISSUE OF CIRCULAR THE MONETARY L IMIT SPECIFIED IN THE CIRCULAR IS NOT APPLICABLE TO THE PRESENT APPEAL. THEREFORE, HE REQ UESTED TO DISPOSE OF ON MERIT. 6. ON CAREFUL PERUSAL OF MATERIAL ON RECORD KEEPIN G IN VIEW OF THE FACT THAT THE LD. DR COULD NOT GIVE CONTRARY JUDGEMENT TO THE ONE ON WHICH THE LD. COUNSEL FOR THE ITA NO.1056/KOL/2010 & C.O.NO.72/KOL/2 010 ITO VS MADOORIE TEA ESTATE PVT.LTD. A.YR.2006-07 3 ASSESSE HAS RELIED WHEREIN THE HONBLE DELHI HIGH C OURT IN THE CASE OF CIT VS DELHI RACE CLUB IN ITA NO.128/2008 DATED 03.03.2011 HAS H ELD AS UNDER :- THE TAX EFFECT INVOLVED IN THE PRESENT APPEAL IS R S.4,65,860/-. AS PER THE RECENT GUIDELINES OF THE CBDT, APPEAL IN THOSE CASE S WHERE THE TAX EFFECT IS LESS THAN 10 LACS, ARE NOT TO BE ENTERTAINED. THIS COURT IN THE CASE OF COMMISSIONER OF INCOME TA X-III V. M/S. P.S.JAIN AND CO. BEING ITA NO.179/1991 DECIDED ON 2 ND AUGUST, 2010 HAS TAKEN A VIEW THAT SUCH CIRCULAR WOULD ALSO APPLY TO PENDING CASES. 6.1. ADMITTEDLY THE TAX PAYABLE IN RESPECT OF GROUN DS OF APPEAL BY THE DEPARTMENT IS LESS THAN RS.3 LAKHS AND AS PER REVISED INSTRUCT ION OF THE CBDT NO.3 DATED 9.2.2011. WHEREIN THE CBDT HAS REVISED THE FILING L IMITS FILED BEFORE THE TRIBUNAL, HIGH COURT AND SUPREME COURT AS UNDER :- BEFORE THE INCOME TAX APPELLATE TRIBUNAL : RS. 3 L AKHS, APPEALS U/S 260A OF THE IT ACT BEFORE THE HONBLE HIGH COURT : RS.10 LAKHS AND BEFORE THE HONBLE SUPREME COURT : RS.25 LAKHS SINCE IN THE PRESENT CASE THE ABOVE REVISED INSTRUC TION IS WELL APPLICABLE IN VIEW OF THE HONBLE DELHI HIGH COURT (SUPRA) HENCE IN OUR OPINI ON THE REVENUES APPEAL IS NOT MAINTAINABLE IN VIEW OF THE SAID CIRCULAR OF THE CB DT. 6.2. WE FURTHER FIND THAT IT IS A SETTLED LAW THAT THE CIRCULARS ISSUED BY CBDT ARE BINDING ON THE REVENUE. THIS POSITION WAS CONFIRMED BY THE APEX COURT IN THE CASE OF COMMISSIONER OF CUSTOMS VS INDIAN OIL CORPORATIO N LTD. REPORTED IN 267 ITR 272 WHEREIN THEIR LORDSHIPS EXAMINED THE EARLIER DECISI ONS OF THE APEX COURT WITH REGARD TO BINDING NATURE OF THE CIRCULAR AND LAID DOWN THA T WHEN A CIRCULAR ISSUED BY THE BOARD REMAINS IN OPERATION THEN THE REVENUE IS BOUN D BY IT AND CANNOT BE ALLOWED TO PLEAD THAT IT IS NOT VALID OR THAT IT IS CONTRARY T O THE TERMS OF THE STATUTE. THE APPEAL UNDER CONSIDERATION HAS CERTAINLY BEEN FILED CONTRA RY TO THE CIRCULAR ISSUED BY THE CBDT INSTRUCTION NO.3 DATED 9.2.2011. THE LEARNED D R APPEARING ON BEHALF OF THE REVENUE COULD NOT POINT OUT THAT THE CASE IN HAND F ALLS UNDER THE EXCEPTIONAL CLAUSES OF THE SAID CIRCULAR OF THE CBDT. ITA NO.1056/KOL/2010 & C.O.NO.72/KOL/2 010 ITO VS MADOORIE TEA ESTATE PVT.LTD. A.YR.2006-07 4 6.3. RESPECTFULLY FOLLOWING THE ABOVE DECISION OF T HE HONBLE DELHI HIGH COURT, WE HOLD THAT THE APPEAL FILED BY THE DEPARTMENT, AG AINST THE IMPUGNED ORDER OF THE LD. CIT(A), IS CONTRARY TO THE POLICY DECISION OF T HE DEPARTMENT AND AS SUCH THE APPEAL FILED BY THE DEPARTMENT IS DISMISSED IN LIMINE . 7. IN THE RESULT THE APPEAL FILED BY THE REVENUE S TANDS DISMISSED AND THE CROSS OBJECTION FILED BY THE ASSESSEE STANDS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 24.05.2013. SD/- SD/- [ .., ,, , ] [ .##$ %& , ] [K.K.GUPTA] [ GEORGE MATHAN ] ACCOUNTANT MEMBER JUDICIAL MEMBER ( (( (5 5 5 5) )) ) DATE: 24.05.2013. R.G.(.P.S.) 7 2 0))8 98+:- COPY OF THE ORDER FORWARDED TO: 1. MADOORIE TEA ESTATE PVT. LTD., 7 TH FLOOR, NIHAT HOUSE, 11, R.N.MUKHERJEE ROAD, KOLKATA-700001. 2 THE I.T.O., WARD-10(1), KOLKATA. 3 . CIT KOLKATA 4. CIT(A)- XII, KOLKATA. 5. DR, KOLKATA BENCHES, KOLKATA 18 0)/ TRUE COPY, 7&/ BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES