DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE - 1, AURANGABAD V. M/S.GOOD YEAR SOUTH ASIA TYRES PVT.LTD, AURANGABAD

MA 274/PUN/2022

AI Insights

The case involves the Deputy Commissioner of Income Tax (DCIT), Circle-1, Aurangabad as the applicant and M/s. Goodyear South Asia Tyres Pvt. Ltd. as the respondent. The Revenue filed a miscellaneous application under section 254(2) of the Income Tax Act, 1961, seeking to recall the Tribunal's earlier order that dismissed their appeal due to the monetary limit set by the CBDT's circular. The original appeal contested the assessment order which included additions on account of disallowance of depreciation on impaired and retired assets, unassessed interest, and capital expenses debited to the profit and loss account. The Tribunal's earlier dismissal was based on the monetary threshold for filing appeals, which was not met at that time. However, upon review, it was found that the tax effect involved in the appeal was significantly higher than the threshold, leading to the recall of the dismissal order.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 32611 (ITAT-PUNE)
• Duration Of Justice: 5 year(s) 8 month(s) 15 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 15-10-2024
• Appeal Filed By: Department
• Order Result: Allowed
• Next Hearing Date: 06-09-2024
• Assessment Year: 2009-2010
• Appeal Filed On: 31-01-2019
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: AKHILESH SRIVASTAVA
• Assessee Lawyers: NEERAJ K. JAIN
• Keywords: Retrospective amendment; Depreciation; Tax effect; Unabsorbed depreciation
• Section: 143(3)

Judgement Text

"IN THE INCOME TAX APPELLATE TRIBUNAL PUNE “A” BENCH : PUNE BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER AND SHRI G D PADMAHSHALI , ACCOUNTANT MEMBER M.A.No.274/PUN./2022 Arising out of I.T.A.No.2342/PUN./2017 - Assessment Year 2009-2010 The DCIT, Circle-1, “JEEVAN SUMAN” LIC Bldg., 2nd Floor, Cannought Place, Town Centre, N-5, CIDCO, Jalgaon Road, AURANGABAD. vs., M/s. Goodyear South Asia Tyres Pvt. Ltd., H-18, MIDC, Waluj, AURANGABAD – 431 136. PAN AABCG5544P (Applicant) (Respondent) For Revenue : Shri Akhilesh Srivastava For Assessee : Shri Neeraj K. Jain Date of Hearing : 06.09.2024 Date of Pronouncement : 15.10.2024 ORDER PER SATBEER SINGH GODARA, J.M. : This Revenue’s miscellaneous application M.A.No.274/PUN./2022 filed u/s.254(2) of the of the Income Tax Act, 1961 (in short \"the Act\"), seeks to recall/rectify our order dated 27.07.2018 dismissing it’s corresponding main appeal ITA.No.2342/PUN./2017 for assessment year 2009- 2010. Heard both the parties at length. Case file perused. 2. The Revenue pleads the following in it’s instant miscellaneous application : 2 M.A.No.274 /PUN./2022 “The assessee is a private limited company engaged in the business of manufacturing and sale of automotive tyres & flaps, etc. The assessment u/s 143(3) was completed on 26/03/2013 assessing the total income at Rs.18,32,60,654/- as against income returned by the assessee at Rs.18,14,24,371/-. During the assessment proceedings additions were made on account of disallowance of depreciation on Impaired & retire assets of Rs.4,66,565/-, addition on account of interest received and not offered to tax of Rs.12,58,692/- & expenses capital in nature debited to P & L account of Rs.1,11,026/- also while passing the order above the brought forwarded un-absorbed depreciation was restricted to Rs.112,67,66,573/- instead of Rs.259,93,51,194/-. The assessee company for the year under consideration after set off of un-absorbed depreciation for the A.Y. 1997- 98 & 1998-99 i.e. Rs.10,22,07,698/- & Rs.7,92,16.673/- to the extent of remaining profit declared nil income and c/f un-absorbed depreciation amounting to Rs.259,93,51,194/- comprising the period A.Y. 1998-99 to 2004-05 which includes un- absorbed depreciation of Rs.147,25,84,621/- related to A.Υ. 1998-99 to Α.Υ. 2000- 01. The un-absorbed depreciation pertaining to A.Y. 1998- 99 to 2000-01 was not allowed to be c/f in view of the amendment made to section 32(2) w.e.f. 01.04.1997 which 3 M.A.No.274 /PUN./2022 restricted the carry forward of unabsorbed depreciation to eight succeeding assessment years only. The issue has been elaborately discussed at page no 6 of the assessment order dated 26/03/2013. Aggrieved by the order of A.O, assessee preferred appeal before Ld. CIT(A) in which the assessee has been granted relief. Against the order of the CIT(A), the Revenue filed appeal u/s. 253 of the Act. As the decision of the Ld. CIT(A)-1 was not acceptable on the issue of interest received not offered to tax and expenses debited to P&L which were capital in nature and on the issue of un-absorbed depreciation. The Hon'ble ITAT vide its order No.ITA No.2342/PUN/2017 Dt. 27.07.2018 held at Para No.3, 4 & 5 that – \"The CBDT vide circular No.03/2018, dated 11.07.2018 has revised the monetary limits for filing of appeal by the Department before the Tribunal with retrospective effect. The tax effect in dispute in the captioned appeals is stated to be below the monetary limit of Rs.20.00 lakhs specified in the CBDT Circular dated 11.07.2018. In this background, the learned Departmental Representative for the Revenue was required to state their position, they have not referred to any material 4 M.A.No.274 /PUN./2022 which would show that the captioned appeals are protected by any of the exceptions provided in para 10 of the Circular. Without going into the merit of the issues raised in the captioned appeals. this bunch of appeals are deemed to be withdrawn/not pressed as their filing is in contravention of the CBDT Circular dated 11.07.2018. Before parting, we clarify here that the Revenue shall be liberty to approach the Tribunal for re-institution of appeals, if the requisite material is brought to show that the appeals are protected by the exceptions prescribed in para 10 of the Circular. 3. It is seen that the issues raised before the Hon'ble ITAT vide grounds of appeal have not been adjudicated and the case has been dismissed by relying on the CBDT's circular No. 03/2018. In this case, the T.E. involved is of Rs.56,28,21,809/- which is more than the prescribed monetary limit and hence it is prayed that the issue may kindly be adjudicated.” 3. Learned counsel could hardly dispute that the Revenue’s clinching plea, as per para-3 in the instant application, that the tax effect herein is Rs.56,28,21,809/-, which is very much over and above the CBDT’s circular. We appreciate the assessee’s fair stand and recall our impugned 5 M.A.No.274 /PUN./2022 order dated 27.07.2018. The registry is directed to fix the Revenue’s main appeal ITA.No.2342/PUN./2017 for hearing as per rules. Ordered accordingly. 4. This Revenue’s miscellaneous application M.A.No.274/PUN./2022 is allowed in above terms. Order pronounced in the open Court on 15.10.2024. Sd/- Sd/- [GD PADMAHSHALI] [SATBEER SINGH GODARA] ACCOUNTANT MEMBER JUDICIAL MEMBER Pune, Dated 15th October, 2024 VBP/- Copy to 1. The appellant 2. The respondent 3. The Pr. CIT, Pune concerned. 4. The D.R. ITAT, Pune-A-Bench, Pune. 5. Guard File. //By Order// //True Copy // Sr. Private Secretary, ITAT, Pune Benches, Pune. "