ACIT, JHUNJHUNU V. SHRI KRISHANA CONSTRUCTION CO., JHUNJHUNU

ITA 1046/JPR/2016

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 3115 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 8 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 23-08-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 01-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROSHANTA MEENA
• Assessee Lawyers: MANISH DHARNIDHARKA
• Keywords: Tax effect

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKO ] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA NO. 1046/JP/2016 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2013-14 ASSTT. COMMISSIONER OF INCOME TAX CIRCLE, JHUNJHUNU CUKE VS. M/S SHRI KRISHANA CONSTRUCTION CO., GAYATRI MARKET, CHIRAWA, JHUNJHUNU LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: ABGFS4261G VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT IZR;K{KSI.K @ C.O. NO. 04/JP/2017 (ARISING OUT OF VK;DJ VIHY LA-@ ITA NO. 1046/JP/2016) FU/KZKJ.K O'K Z @ ASSESSMENT YEAR 2013-14 M/S SHRI KRISHANA CONSTRUCTION CO., GAYATRI MARKET, CHIRAWA, JHUNJHUNU CUKE VS. ASSTT. COMMISSIONER OF INCOME TAX CIRCLE, JHUNJHUNU LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: ABGFS4261G IZR;K{KSID@ OBJECTOR IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS @ REVENUE BY : SHRI ROSHANTA MEENA (JCIT) FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SHRI MANISH DHARNIDHARKA (CA) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 23/08/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT : 23/08/2018 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M.: THIS IS THE APPEAL FILED BY THE REVENUE AND THE CR OSS OBJECTION FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A) -III, JAIPUR DATED 26/09/2016 PERTAINING TO THE A.Y. 2013-14 WHEREIN T HE REVENUE AND THE ASSESSEE HAVE TAKEN FOLLOWING GROUNDS OF APPEAL:- ITA 1046/JP/2016 & C.O. 04/JP/2017_ ACIT, CIRCLE JHUNJHUNU VS M/S SHRI KIRSHANA CONSTRU CTION, JHUNJHUNU 2 GROUNDS OF REVENUES APPEAL: (I) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN REDUCING NP RATE FROM 8% TO 5.5% IGNORI NG THE FACT THAT THE ASSESSEE DID NOT MAINTAIN DETAILS OF CONSUMPTION OF MATERIAL OF RS. 11,53,00,002/-. (II) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E LD. CIT(A) HAS ERRED IN DELETING THE DISALLOWANCE OF RS. 3,77,996/ - U/S 40(A)(IA) BECAUSE THE ASSESSEE WAS LIABLE TO DEDUCT TAX ON PAYMENT OF INTEREST TO NON BANKING FINANCIAL COMPANIES. GROUNDS OF ASSESSEES C.O.: 1. ON THE FACTS & CIRCUMSTANCES OF THE CASE LD. LOWER AUTHORITIES GROSSLY ERRED IN CONFIRMING THE REJECTION OF BOOKS OF ACCOU NT BY INVOKING PROVISION OF SECTION 145(3). 2. ON THE FACTS & CIRCUMSTANCES OF THE CASE LD. CIT(A) GROSSLY ERRED IN CONFIRMING THE ADDITION IN THE DECLARED INCOME BY E STIMATING 5.5% N.P. RATE INSTEAD OF DECLARED N.P. RATE OF 1.33%. 3. ON THE FACTS & CIRCUMSTANCES OF THE CASE LD. CIT(A) GROSSLY ERRED IN CONFIRMING THE ADDITION OF RS. 10,020/- ON UNDISCLO SED RECEIPTS OF RS. 1,25,250/-. 2. FIRSTLY, WE WILL TAKE UP THE CROSS OBJECTION FIL ED BY THE ASSESSEE WHEREIN HE HAS CHALLENGED THE ACTION OF THE ASSESSI NG OFFICER IN INVOKING THE PROVISIONS OF SECTION 145(3) AND ESTIMATING N.P . RATE 2.1 AT THE OUTSET OF HEARING, THE LD AR OF THE ASSE SSEE STATED THAT HE DOESNT WISH TO PRESS THE GROUNDS SO TAKEN IN THE A SSESSEES C.O., THEREFORE, THE SAME STANDS DISMISSED AS NOT PRESSED . 3. NOW WE TAKE THE REVENUES APPEAL. AT THE TIME OF HEARING, THE LD. AR OF THE ASSESSEE HAS RAISED AN OBJECTION OF MAINT AINABILITY OF THE APPEAL OF THE REVENUE DUE TO THE TAX EFFECT NOT EXCEEDING RS. 20 LACS AS PER THE CBDT CIRCULAR NO. 3 OF 2018 DATED 11 TH JULY, 2018. ITA 1046/JP/2016 & C.O. 04/JP/2017_ ACIT, CIRCLE JHUNJHUNU VS M/S SHRI KIRSHANA CONSTRU CTION, JHUNJHUNU 3 3.1. THE LD. D/R HAS FAIRLY SUBMITTED THAT THE TAX EFFECT INVOLVED IN THE REVENUES APPEAL COMES TO RS 10,95,167/- LESS THAN RS 20 LACS WHICH IS PRESCRIBED THRESHOLD LIMIT IN TERMS OF THE CBDT CIR CULAR NO. 3/2018 DATED 11 TH JULY, 2018 ISSUED IN SUPERSESSION OF ITS EARLIER C IRCULAR NO. 21 OF 2015 DATED 10.12.2015. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS OBSERVED THAT THE DEMAN D/ TAX EFFECT IN THE REVENUES APPEAL IN QUESTION IS BELOW RS. 20.00 LAC S. UNDER THE POWERS VESTED BY SECTION. 268A(1) OF THE IT ACT, CBDT HAS RECENTLY ISSUED CIRCULAR NO. 3/2018 DATED 11TH JULY, 2018 (F NO. 27 9/MISC. 142/2007- ITJ(PT) INSTRUCTING THE AUTHORITIES BELOW THAT DEPA RTMENTAL APPEAL SHOULD NOT BE FILED BEFORE ITAT WHERE THE DEMAND/TAX EFFEC T DOES NOT EXCEED RS. 20 LACS. THE CIRCULAR IS SPECIFICALLY MENTIONED TO BE APPLICABLE FOR ALL PENDING APPEALS. 5. SUBJECT TO SOME EXCEPTIONS, IT IS FURTHER DIREC TED BY CBDT THAT ALL THE DEPARTMENTAL APPEALS PENDING BEFORE ITAT WHERE THE DEMAND/TAX EFFECT IS NOT EXCEEDING THAN 20 LACS SHOULD BE EITH ER WITHDRAWN OR NOT PRESSED BY THE DEPARTMENTAL REPRESENTATIVES. 6. THE PRESENT APPEAL IS NOT COVERED BY ANY EXCEPT IONS MENTIONED IN THE SAID CBDT CIRCULAR. SINCE THE TAX DEMAND IN DIS PUTE IN THIS DEPARTMENTAL APPEAL IS BELOW THE LIMIT SET OUT BY C BDT FOR THE APPEAL, THE APPEAL OF THE ASSESSEE IS NOT MAINTAINABLE IN VIEW OF CBDT CIRCULAR NO. 3 OF 2018 DATED 11.07.2018. ACCORDINGLY THE APPEAL OF THE REVENUE IS DISMISSED AS NOT PRESSED/WITHDRAWN. ITA 1046/JP/2016 & C.O. 04/JP/2017_ ACIT, CIRCLE JHUNJHUNU VS M/S SHRI KIRSHANA CONSTRU CTION, JHUNJHUNU 4 7. IN THE RESULT, BOTH THE APPEAL OF THE REVENUE AN D THE C.O. OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 23/08/2018 SD/- SD/- FOT; IKY JKO FOE FLAG ;KNO (VIJAY PAL RAO) (VIKRAM SINGH YADAV ) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 23/08/2018 *GANESH KR. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- ACIT, JHUNJHUNU 2. IZR;FKHZ@ THE RESPONDENT- SHRI KRISHANA CONSTRUCTION CO., JHUNJHUNU 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 1046/JP/2016 & CO 04/JP/2017) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR