DY. COMMISSIONER OF INCOME TAX, RAIPUR V. AGRAWAL GLOBAL INFRATECH PVT. LTD., RAIPUR

ITA 347/RPR/2024

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The case involves the Deputy Commissioner of Income Tax (Appellant) against Agrawal Global Infratech Pvt. Ltd. (Respondent) concerning a penalty imposed under section 271AAC(1) of the Income Tax Act, 1961, for the Assessment Year 2018-19. The penalty of Rs. 54,36,942 was initially imposed by the Assessing Officer (AO) due to additions made under section 68 and section 40a(ia) of the Act, which were later contested and led to an appeal. The Commissioner of Income Tax (Appeals) allowed the appeal of the assessee, deleting the penalty, which was then challenged by the revenue before the ITAT. However, the ITAT dismissed the revenue's appeal based on the monetary limit prescribed by the CBDT, which restricts appeals with a tax effect below Rs. 60 lakhs.

• Counselvise Citation: [2024] 140 COUNSELVISE.COM (IT) 106791 (ITAT-RAIPUR)
• Duration Of Justice: 3 month(s) 28 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-11-2024
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 28-11-2024
• Assessment Year: 2018-2019
• Appeal Filed On: 01-08-2024
• Laws Referred To: Income Tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S.L.ANURAGI
• Assessee Lawyers: RAVI AGRAWAL
• Keywords: Unexplained cash credit; Tax effect
• Section: 143(3); 250; 68; 274; 40a(ia)

Judgement Text

"आयकर अपीलीय अिधकरण, रायपुर Ɋायपीठ, रायपुर IN THE INCOME TAX APPELLATE TRIBUNAL RAIPUR BENCH, RAIPUR ŵी रिवश सूद, Ɋाियक सद˟ एवं ŵी अŜण खोड़िपया, लेखा सद˟ क े समƗ । BEFORE SHRI RAVISH SOOD, JM & SHRI ARUN KHODPIA, AM आयकर अपील सं. / ITA No: 347/RPR/2024 (िनधाŊरण वषŊ Assessment Year: 2018-19) Deputy Commissioner of Income Tax, Aaykar Bhavan, Civil Lines, Raipur, C.G.- 492001 V s Agrawal Global Infratech Pvt. Ltd., C-2/101, Aishwarya Chambers, G.E. Road, Telibandha, Raipur, C.G.-492001 PAN: AAPCA0850L (अपीलाथŎ/Appellant) . . (ŮȑथŎ / Respondent) िनधाŊįरती की ओर से /Assessee by : Shri Ravi Agrawal, CA राजˢ की ओर से /Revenue by : Shri S. L. Anuragi, CIT DR सुनवाई की तारीख / Date of Hearing : 28.11.2024 घोषणा की तारीख/Date of Pronouncement : 29.11.2024 आदेश / O R D E R Per Arun Khodpia, AM: This is an appeal by the revenue, directed against the order of Commissioner of Income Tax (Appeals), NFAC, Delhi, [(in short “Ld. CIT(A)”] u/s 250 of the Income Tax Act, 1961 (in short “the Act”), for the AY 2018-19, dated 05.06.2024, which in turn arises from the order of Assessing Officer, NFACT, Delhi, (in short “Ld. AO”), u/s 271AAC(1) of the Act, dated 05.02.2022. 2. The grounds of appeal raised by the revenue are as under: 2 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur 1. \"Whether on the facts and in the circumstance of the case, and in law, the Id. CIT(A) has erred in deleting the penalty of Rs. 54,36,942/- imposed on the assessee 271AAC(1) of the Income Tax Act, 1961?\" 2. The order of Id. CIT(A) is not accordance with laws and facts of the case. 3. Any other ground which may be adduced at the time of hearing. 3. Brief facts of the case are as under: 4. Brief facts of the case are that the appellant filed return of income for the A.Y. 2018-19 on 07/08/2018 declaring total income at Rs. 10,33,16,780/-. The assessment was completed u/s 143(3) r.w.s. 144B determining the total income at Rs. 19,39,90,490/- by making following additions: Unsecured laon taxed u/s 68 Rs. 9,06,15,711/- Addition u/s 40a(ia) Rs. 58,000/- During the assessment proceedings, the A.O. observed that in the balance sheet, notes to account at note 5, in the heading \" Unsecured borrowings\", in the assessment year, the increase in the loans and advances from directors and related parties was mentioned as Rs.5,78,42,443/- and increase in the loans and advances from other company has been shown as Rs 2,63,03,268/-. The A.O. also observed that share capital amount was increased from Rs to Rs 65,70,000 for the financial year under consideration. The total amount for the transactions was Rs. 9,06,15,711/-. The appellant provided the details of the unsecured loans, increase in share capital etc. After examining these details, the AO did not accept the genuineness of the aforesaid credit entries totalling Rs. 9,06,15,711/- and added the same as unexplained cash credit u/s 68. Penalty proceedings u/s 271AAC were initiated with respect to this addition. 3 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur 4.2 During the penalty proceedings, the appellant was given numerous opportunities by issuing notices u/s 274 read with section 271AAC(1) of the Income Tax Act, 1961. The appellant replied but the contention of the appellant was not accepted by the A.O. The A.O. on the basis of material available on record and since the appellant failed to give any valid explanation, held the appellant to be in default within the meaning of section 274 r.w.s. 271AAC(1). The A.O. computed penalty at the rate of 10% u/s 271AAC(1) of the tax payable u/s. 115BBE and imposed penalty of Rs. 54,36,942/-. Aggrieved by the order of the AO, the appellant has preferred the present appeal. 4. Aggrieved with the aforesaid penalty order of Ld. AO, assessee preferred an appeal before the Ld. CIT(A), wherein the contentions and submissions of the assessee are found convincing, therefore, the appeal of assessee was allowed with the following observations: 6. Decision: 6.1 I have carefully considered the grounds of appeal, statement of facts, submissions made from time to time and the details mentioned in the penalty order. In this cse, the quantum appeal of the appellant for AY 2018-19 has been decided vide order No. ITBA/NFAC/S/250/2024-25/1065076917(1) dated 22/05/2024 and the addition u/s 68 of Rs. 9,06,15,711/- stands deleted. Consequently, the penalty levied u/s 271AAC(1) of Rs. 54,36,942/- in connection with tax payable u/s 115BBE on the addition u/s 68 of Rs. 9,06,15,711/- is hereby deleted. 4 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur 5. Aggrieved with the decisions of Ld. CIT(A), now the revenue has preferred to carry the matter before us, which is under consideration in the present case. 6. At the outset, from the appeal memo in form No. 36 furnished by the department, the aggregate tax effect relating to the grounds of appeal was reported at Rs. 54,36,942/-, which is below the revised monetary limit prescribed by the Central Board of Direct Taxes (CBDT) for filing of appeal before the Income Tax Appellate Tribunal (ITAT). The relevant Circular No. 9/2024 dated 17.09.2024 along with reference Circular No. 5/2024 dated 15.03.2024 are extracted hereunder for the sake of reference: 5 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur 6 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur 7 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur 8 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur 9 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur 10 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur 11 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur 7. As directed in the aforesaid circulars, the revenue is not entitled to file an appeal having tax effect below Rs.60 lakh effective from 17.09.2024, which shall be applicable to all the appeals filed henceforth and also to the appeals pending before the Tribunal, which may accordingly direct to be withdrawn, subject to exceptions as per paras 3.1 & 3.2 of circular no. 5/2024(supra) where the 12 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur decision to appeal shall be taken on merits without regard to the tax effect and the monetary limits. 8. Ld. CIT DR is confronted with the aforesaid preposition emerging from the circulars referred to herein (supra), that whether the present case having tax effect of Rs. 54,36,842/-, which is below the revised monetary limit of Rs. 60 lakhs fall under the exceptions carved out in paras 3.1 & 3.2 of circular no. 5/2024 (supra). In response, it is submitted that the case under consideration is not covered under any of the exceptions therefore, the same is below the revised monetary limits prescribed under circular no. 9/2024 (supra), accordingly, it needs to be dismissed as withdrawn. 9. Ld. AR representing the case of assessee have fairly aggrieved with the aforesaid submissions of the Ld. CIT-DR and have requested to dismiss the appeal of revenue which is not maintainable on account of low tax effect. 10. We have considered the rival submissions and perused the material available on record. Since the appeal of the revenue is evidently filed for the issues involving tax effect of Rs. 54,36,942/-, which is below the revised monetary limit of Rs.60 lakhs, therefore, the appeal of the revenue is not maintainable in terms of binding directions communicated by the CBDT vide 13 ITA No.347/RPR/2024 DCIT vs Agrawal Global Infratech Pvt. Ltd., Raipur circular no. 09/2024 (supra) read with circular no. 5/2024 (supra). The appeal of revenue in ITA No. 347/RPR/2024, therefore, stands dismissed as withdrawn / not maintainable. 11. In result, the appeal of revenue stands dismissed, in terms of our aforesaid observations. Order pronounced in the open court on 29/11/2024. Sd/- (RAVISH SOOD) Sd/- (ARUN KHODPIA) Ɋाियक सद˟ / JUDICIAL MEMBER लेखा सद˟ / ACCOUNTANT MEMBER रायपुर/Raipur; िदनांक Dated 29/11/2024 Vaibhav Shrivastav आदेश की Ůितिलिप अŤेिषत/Copy of the Order forwarded to : आदेशानुसार/ BY ORDER, (Senior Private Secretary) आयकर अपीलीय अिधकरण, रायपुर/ITAT, Raipur 1. अपीलाथŎ / The Appellant- DCIT, Raipur 2. ŮȑथŎ / The Respondent- Agrawal Global Infratech Pvt. Ltd. 3. आयकर आयुƅ(अपील) / The CIT(A), 4. The Pr. CIT, Raipur (C.G.) 5. िवभागीय Ůितिनिध, आयकर अपीलीय अिधकरण, रायपुर/ DR, ITAT, Raipur 6. गाडŊ फाईल / Guard file. // स×याǒपत Ĥित True copy // "