The ITO, Ward-2(2), JAMNAGAR V. M/s Subhash Motors Transport Co., JAMNAGAR

ITA 114/RJT/2016

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 9057 (ITAT-RAJKOT)
• Duration Of Justice: 1 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 06-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AVINASH KUMAR
• Assessee Lawyers: CHETAN L AGARWAL
• Keywords: Audit objection; Tax effect
• Section: 40A(3); 201(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT [CONDUCTED THROUGH E-COURT AT AH MEDABAD] BEFORE SHRI MAHAVIR PRASAD, JUDICIAL MEMBER AND SHRI, MANISH BORAD, ACCOUNTANT MEMBER ./ I.T.A. NO.114/RJT/2016 ( / ASSESSMENT YEAR : 2009-10) INCOME-TAX OFFICER, WARD-2(2), TARANJALI BUILDING, ROOM NO.09 GROUND FLOOR, P.N. MARG, JAMNAGAR V/S M/S. SUBHASH MOTORS TRANSPORT CO. VICTORIA BRIDGE, JAMNAGAR. (APPELLANT) (RESPONDENT) PAN: AAIFS 9571 L APPELLANT BY : SHRI AVINASH KUMAR, SR. D .R. RESPONDENT BY : SHRI CHETAN L. AGARWAL, A.R. ( )/ ORDER DATE OF HEARING : 15/05/2017 DATE OF PRONOUNCEMENT : 16/05/2017 PER MAHAVIR PRASAD, JUDICIAL MEMBER: 1. THIS APPEAL BY THE REVENUE IS PREFERRED AGAINST THE ORDER OF LD. CIT(A)- JAMNAGAR DATED 22/01/2016 PERTAINING TO A.Y . 2009-10. ITA NO. 114/RJT/2016 A.Y.2009-10 2 2. THE SUBSTANTIVE GRIEVANCE OF THE REVENUE READS AS U NDER:- I. WHETHER, ON FACTS AND THE CIRCUMSTANCES OF THE CASE , THE LEARNED CIT(A) WAS JUSTIFIED IN DELEING THE ADDITION/DISALLOWANCE OF RS.1,44,167/-. II. WHETHER, ON FACTS AND THE CIRCUMSTANCES OF THE CASE , THE LEARNED CIT(A) WAS JUSTIFIED IN DELETING THE ADDITION OF RS.1,46,0 00/- U/S.40A (3) OF THE IT ACT, 1961. III. A. ALTHOUGH THE TAX EFFECT INVOLVED IN THIS CASE IS LESS THAN RS.10 LAKHS, THE APPELLANT CLAIMS RELIEF ON LEGAL GROUND AS TO WHETHER THE PROVISIONS OF SECTION 40A(3) SHALL APPLY TO THE PAY MENT MADE IN CASH TO THE PARTNER OF THE ASSESSEE FIRM OR NOT. B. SIMILARLY, WHETHER THE PROVISO TO SECTION 201(1) READ WITH SECOND PROVISO BELOW SECTION 40(A)(IA) WOULD APPLY TO THE CASE OF THE ASSESSEE EVEN WHEN THE ASSESSEE HAD FAILED TO PROVE THAT THE PAYEES HAD ACCOUNTED FOR THE INTEREST PAID TO THEM IN THEIR INCOME AND H AD PAID TAX THEREON. IV. ON THE BASIS OF THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LEARNED CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFF ICER. V. THAT THE REVENUE CRAVES LEAVES TO ADD, AMEND, ALTER OR WITHDRAW ANY GROUND OF APPEAL. VI. IT IS THEREFORE PRAYED THAT THE ORDER OF THE CIT(A) , JAMNAGAR MAY KINDLY BE SET ASIDE AND THAT OF ASSESSING OFFICER BE RESTO RED. 3. AT THE OUTSET, THE LD. COUNSEL FOR THE ASSESSEE SUB MITTED THAT THE APPEAL OF THE REVENUE NEEDS TO BE DISMISSED ON ACCOUNT OF LOW TAX EFFECT IN VIEW OF THE CBDT CIRCULAR NO.21 OF 2015 DATED 10.12.2015. THE LD. DEPARTMENTAL REPRESENTATIVE FAIRLY ADMITTED THAT THE TAX EFFECT IS LESS THAN THE LIMIT PRESCRIBED BY THE AFORESAID CBDT CIRCULAR. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATE RIAL AVAILABLE ON RECORD. WE FIND THAT PRIMA-FACIE THIS APPEAL OF THE REVENUE IS NOT MAINTAINABLE IN VIEW OF CBDT CIRCULAR NO. 21/2015 I N F.NO.279/MISC. 142/2007-ITJ (PT) DATED 10TH DECEMBER 2015, VIDE WH ICH IT HAS BEEN PROVIDED THAT IF THE TAX EFFECT BY VIRTUE OF THE CO MMISSIONER OF INCOME-TAX (APPEALS)S ORDER IS BELOW RS. 10 LACS, THEN THAT O RDER WOULD NOT BE ITA NO. 114/RJT/2016 A.Y.2009-10 3 CHALLENGED BEFORE THE TRIBUNAL IN FURTHER APPEAL. THE BOARD HAS PROVIDED EXEMPTIONS AT CLAUSE (8) OF THE INSTRUCTIONS WHEREI N IT HAS BEEN PROVIDED THAT THESE INSTRUCTIONS WILL NOT BE APPLICABLE, IF VIRES OF ANY PROVISIONS HAS BEEN QUASHED BY IMPUGNED ORDER OR ADDITION WAS MADE ON SOME AUDIT OBJECTIONS OR THE ADDITION RELATES TO UNDISCLOSED F OREIGN ASSETS/BANK ACCOUNTS, ETC. WE FIND THAT THE PRESENT CASE DOES NOT FALL WITHIN THE EXEMPTION CLAUSE AND THE TAX IS LESS THAN RS.10 LAC S. THEREFORE, THE PRESENT APPEAL IS NOT MAINTAINABLE AND HENCE DISMISSED. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED IN LIMINE. ORDER PRONOUNCED IN OPEN COURT ON 16/05/2017 SD/- SD/- (MANISH BORAD) (MAHAVIR PRASAD) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD: 16/05/2017 PRITI COPY OF THE ORDER FORWARDED TO: - 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT (APPEALS) JAMNAGAR. 4. THE CIT CONCERNED. 5. THE DR., ITAT, AHMEDABAD. 6. GUARD FILE. BY ORDER DEPUTY/ASSTT.REGISTRAR ITAT,RAJKOT TRUE COPY 1. DATE OF DICTATION .. 15/05/2017 (COVERED CASE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER .. 15/05/2017 3. OTHER MEMBER... 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S..