The DCIT, Circle-3(1), Baroda V. Shri Pawankumar M. Sanghvi, Baroda

ITA 1034/AHD/2016

• Counselvise Citation: [2019] 115 COUNSELVISE.COM (IT) 3236 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-11-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2008-2009
• Appeal Filed On: 26-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: P D SHAH
• Keywords: Tax effect

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI AMARJIT SINGH, ACCOUNTANT MEMBER ./ ITA NO. 1034/AHD/2016 / ASSESSMENT YEAR: 2010-11 DEPUTY COMMISSIONER OF INCOME-TAX, CIRCLE 3 (1), BARODA VS. SHRI PAWANKUMAR M. SANGHVI, PROP. OF M/S. RAVI STEEL, NARSINGH ESTATE, WADI- YAMUNA MILL ROAD, PRATAP NAGAR, DIST: BARODA 390004 PAN : AGIPS 3322 F / (APPELLANT) / (RESPONDENT) REVENUE BY : SHRI VINOD TANWANI, SR DR ASSESSEE BY : SHRI PD SHAH, AR ! / DATE OF HEARING : 24/10/2019 / DATE OF PRONOUNCEMENT: 15/11/2019 / O R D E R PER RAJPAL YADAV, JUDICIAL MEMBER: THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL AGAINS T THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-4, VADODARA DATED 18.12.2015 PASSED FOR ASSESSMENT YEAR 2010-11. 2. THE GROUNDS TAKEN BY THE REVENUE ARE AS FOLLOWS: - 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT (APPEALS) ERRED IN DELETING THE ADDITION OF RS. 1,44,54,654/- ON ACCOUNT OF BOGUS ACCOMMODATION ENTRY OF LONG TERM CAPITAL G AIN FROM M/S ALLIANCE INTERMEDIATERIES & NETWORK PVT. LTD. AND M/S. G OLDSTAR FINVEST PVT.LTD. 2. THE LD. CIT(A) ERRED IN NOT APPRECIATING THE F ACT THAT M/S ALLIANCE INTERMEDIATERIES & NETWORK PVT. LTD AND M/S. GOLDST AR FINVEST PVT.LTD HAVE THEMSELVES DEPOSED BEFORE HON'BLE ITAT THAT TH EY WERE ENTRY PROVIDER, AND THE ITAT MUMBAI BY THEIR ORDER IN ITAT NO. 4625 /MUM/2005 & 5000/MUM/2005 FOR THE A.Y.2002-03 HAVE DECIDED TO C HARGE 0.15% OF TOTAL AMOUNT OF ENTRIES AS INCOME OF THESE TWO CONCERNS. ITA NO. 1034/AHD/2016 DCIT VS. SHRI PAWANKUMAR M SANGHVI FOR AY: 2010-11 2 3. THE LD. CIT(A) FAILED IN NOT APPRECIATING THE FACT THAT THE ASSESSEE COULD NOT SUBMIT DE-MAT ACCOUNT IN RESPECT OF SHARES PRIM E CAPITAL AND ZEN SHAVINGS, WHICH IS AN ESSENTIAL TO PROVE THE SHARE HOLDING RATHER THE BANKING CHANNEL SO RELIED UPON BY THE LD. CIT(A). 4. THE LD. CIT(A) ALSO FAILED IN NOT APPRECIATING THE FACT THAT DURING THE YEAR THESE COMPANIES ARE NOT STOCK BROKERS AS SUCH THEY HAVE NO RIGHT TO ISSUE BILLS FOR SUCH TRANSACTION, AS THEY WERE EXPELLED F ROM TRADING MEMBERSHIP OF THE STOCK EXCHANGE W.E.F. 21.06.2004. 3. WHEN THIS APPEAL WAS CALLED OUT FOR HEARING, LEA RNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE PRESENT APPEAL OF THE R EVENUE NEEDS TO BE DISMISSED ON ACCOUNT OF LOW TAX EFFECT IN VIEW OF T HE RECENT CBDT CIRCULAR NO. 17 OF 2019 DATED 08.08.2019 WHEREBY THE MONETAR Y LIMITS FOR FILING THE APPEAL BY THE REVENUE BEFORE THE TRIBUNAL WAS ENHAN CED FROM RS.20 LAKHS TO RS.50 LAKHS. THIS INSTRUCTION IS APPLICABLE TO THE PENDING CASES ALSO. THEREFORE, THE PRESENT APPEAL OF THE REVENUE IS LIA BLE TO BE DISMISSED AS NON-MAINTAINABLE AS HELD BY THIS TRIBUNAL IN THE CA SE OF ITO VS. DINESH MADHAVLAL PATEL IN ITA NO.1398/AHD/2004 FOR AY 1998 -99 VIDE A CONSOLIDATED ORDER DATED 14.08.2019. 4. THE LEARNED DEPARTMENTAL REPRESENTATIVE FAIRLY ADMITTED THAT THE TAX EFFECT INVOLVED IN THE APPEAL IS LESS THAN THE LIMI T PRESCRIBED BY THE AFORESAID CBDT CIRCULAR. 5. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF APPLICABLE LEGAL POSITION. AS LEARNED COUNSEL RIGHTLY CONTENDS, THE PRESENT AP PEAL OF THE REVENUE IS NO LONGER MAINTAINABLE IN VIEW OF THE RECENT CBDT CIRC ULAR NO. 17 OF 2019 DATED 08.08.2019. THE MANDATORY LIMIT FOR CASES IN WHICH REVENUE CAN CHALLENGE THE RELIEF GRANTED BY THE CIT(A) NOW STAN DS ENHANCED TO RS.50 LAKHS. THIS CONCESSION GRANTED BY THE CENTRAL BOAR D OF DIRECT TAXES (CBDT) IS RETROSPECTIVE IN EFFECT INASMUCH AS IT APPLIES T O ALL PENDING APPEALS AS ITA NO. 1034/AHD/2016 DCIT VS. SHRI PAWANKUMAR M SANGHVI FOR AY: 2010-11 3 WELL. IN VIEW OF THE ABOVE POSITION, THE APPEAL FI LED BY THE REVENUE IS NO LONGER MAINTAINABLE AND IS DISMISSED AS SUCH. 6. IT IS, HOWEVER, MADE CLEAR THAT ON RE-VERIFICATI ON AT THE END OF THE ASSESSING OFFICER IT COMES OUT THAT THE TAX EFFECT OF MORE THAN RS.50 LAKHS IS BEING INVOLVED IN THE APPEAL OR THE APPEAL FALLS WI THIN THE EXEMPTION CLAUSE OF THE CIRCULAR, THEN THE REVENUE WILL BE AT LIBERT Y TO FILE MISCELLANEOUS APPLICATION TO RECALL THE TRIBUNAL ORDER. THE APPLI CATION SHOULD BE FILED WITHIN TIME LIMIT PRESCRIBED IN THE ACT. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D DUE TO LOW TAX EFFECT. ORDER PRONOUNCED IN THE COURT ON 15 TH NOVEMBER 2019 AT AHMEDABAD. SD/- SD/- (AMARJIT SINGH) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 15/11/2019 BIJU T., SR.PS ! &'( )( / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ! # / CONCERNED CIT 4. # ( ) / THE CIT(A) 5. & ! , ! , / DR, ITAT, AHMEDABAD 6. / GUARD FILE . / BY ORDER, TRUE COPY / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION- 14.11.2019.. 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE D ICTATING MEMBER .14.11.2019.. OTHER MEMBER 15.11.2019. 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P.S ./P.S. - 15.11.2019. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DI CTATING MEMBER FOR PRONOUNCEMENT 15.11.2019 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK15.1 1.2019 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGIST RAR FOR SIGNATURE ON THE ORDER 8. DATE OF DESPATCH OF THE ORDER