Asstt.Commissioner of Income Tax, Ludhiana V. Malwa Cotton Spinning Mills Ltd, Ludhiana

ITA 1101/CHANDI/2013

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 1556 (ITAT-CHANDIGARH)
• Duration Of Justice: 1 year(s) 8 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-08-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 28-07-2015
• Assessment Year: 2006-2007
• Appeal Filed On: 02-12-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K MITTAL
• Assessee Lawyers: M L JOSHI
• Keywords: Question of law; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DIVISION BENCH, CHANDIGARH BEFORE SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI T.R.SOOD, ACCOUNTANT MEMBER ITA NO. 1101/CHD/2013 ASSESSMENT YEAR: 2006-07 THE ACIT, VS M/S MALWA COTTON SPINNI NG CIRCLE - VII, MILLS LTD., LUDHIANA. INDUSTRIAL AREA A LUDHIANA. PAN: AABCM1201D (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI S.K.MITTAL, DR RESPONDENT BY : SHRI M.L.JOSHI DATE OF HEARING : 28.07.2015 DATE OF PRONOUNCEMENT : 03.08.2015 O R D E R PER BHAVNESH SAINI,JM THIS APPEAL BY REVENUE IS DIRECTED AGAINST THE ORDE R OF LD. CIT(APPEALS)-II, LUDHIANA DATED 11.09.2013 FOR ASSESSMENT YEAR 2006-07. 2. IN THE PRESENT APPEAL, REVENUE CHALLENGED THE DE LETION OF ADDITION OF RS. 3,06,964/- IN RESPECT OF INTEREST E XPENDITURE AND DELETION OF ADDITION OF RS. 5,93,000/- ON ACCOUNT O F INTEREST FREE LOANS GIVEN FOR NON-BUSINESS PURPOSES. 3. THE LD. CIT(APPEALS), WITH REGARD TO DISALLOWANC E OF INTEREST EXPENDITURE NOTED THAT IT IS NOT THE CASE OF THE ASSESSING OFFICER THAT THE FUNDS WERE USED FOR NON- BUSINESS PURPOSES. THE DISALLOWANCE WAS, THEREFORE, DELETED . WITH REGARD TO ADDITION ON ACCOUNT OF INTEREST FREE LOAN S GIVEN, 2 THE LD. CIT(APPEALS) DELETED THE ADDITION FINDING T HE SIMILAR DISALLOWANCE DELETED BY ITAT IN ASSESSEE'S OWN CASE FOR ASSESSMENT YEAR 2003-04. 4. THIS DEPARTMENTAL APPEAL IS FILED IN THE OFFICE OF THE TRIBUNAL ON 02.12.2013. IT IS ADMITTED FACT THAT T HE TAX EFFECT ON THE ISSUES RAISED IN THE DEPARTMENTAL APP EAL IS LESS THAN RS. 3 LACS. AS PER CBDT DIRECTION NO. 3/ 2011 DATED 09.02.2011, THE DEPARTMENTAL APPEAL WOULD NOT BE FILED BEFORE THE TRIBUNAL IN CASE THE TAX EFFECT IN THE DEPARTMENTAL APPEAL DOES NOT EXCEED RS. 3 LACS. IN THIS CASE, NO QUESTION OF LAW ARISES AND NO CIRCULAR OR NOTIFICATION OF THE DEPARTMENT HAVE BEEN CHALLENGED . SINCE TAX EFFECT IS BELOW RS. 3 LACS IN THE DEPARTMENTAL APPEAL, THEREFORE, APPEAL OF THE REVENUE IS FILED IN CONTRA VENTION OF THE ABOVE CBDT CIRCULAR, WHICH IS APPLICABLE TO THE PRESENT DEPARTMENTAL APPEAL. THE DEPARTMENTAL APPEAL, THUS , IS NOT MAINTAINABLE AND IS LIABLE TO BE DISMISSED. 5. IN THE RESULT, DEPARTMENTAL APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 3 RD AUGUST,2015. SD/- SD/- (T.R.SOOD) (BHAVNESH SAINI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 3 RD AUGUST,2015. POONAM COPY TO: THE APPELLANT, THE RESPONDENT, THE CIT(A), THE CIT, DR ASSISTANT REGISTRAR, ITAT CHANDIGARH