ITO, Uttrakhand V. M/s Sanjay Chaudhary A.O.P.,

ITA 130/DEL/2009

• Counselvise Citation: 13020114 RSA 2009
• Duration Of Justice: 2 year(s) 10 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-12-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 22-11-2011
• Assessment Year: 2002-2003
• Appeal Filed On: 13-01-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S MOHANTY
• Assessee Lawyers: O P SAPRA
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G DELHI BEFORE SHRI RAJPAL YADAV AND SHRI K.G. BANSAL ITA NO. 130(DEL)/2009 ASSESSMENT YEAR: 2002-03 INCOME-TAX OFFICER, M/S SANJ AY CHOUDHARY, AOP, WARD-2, HARDWAR. VS. C/O M/S BA LBIR TRAVELS, PURSHART MKT., HOTEL SCHIN BUILDING, OPP. RAILWAY STATION, HARDWAR. (APPELLANT) (RESPONDENT) APPELLANT BY : SMT. S. MOHANTY, DR RESPONDENT BY : SHRI O.P. SAPRA, ADVOCATE DATE OF HEARIN G: 22.11.2011 DATE OF PRONOU NCEMENT: 09.12.2011. ORDER PER K.G. BANSAL : AM THE ONLY GROUND TAKEN BY THE REVENUE IS THAT THE LD. CIT(APPEALS) ERRED ON FACTS AND IN LAW IN HOLDING THAT CONTRIB UTION BY MEMBERS OF A.O.P CANNOT BE ADDED IN THE HANDS OF THE AOP BY IGNORI NG THE FACT THAT THE MEMBERS OF THE AOP COULD NOT PROVE THE CAPACITY TO CONTRIBUTE THE CAPITAL AND THE GENUINENESS OF THE TRANSACTION. 2. THE ADMITTED FACT BEFORE US IS THAT THE TAX EFFECT IS LESS THAN RS. 3.00 LAKH AS THE ADDITION ON THIS GROUND AMOUN TED TO RS. 7,11,109/-. THE ITA NO. 130(DEL)/2009 2 REVENUE COULD NOT POINT TOWARDS ANY DECISION O F JURISDICTIONAL HIGH COURT IN THE MATTER REGARDING FILING APPEAL WHERE TAX EFFECT IS LESS THAN THE PRESCRIBED LIMIT. HOWEVER, HONBLE DELHI HIGH COU RT IN THE CASE OF CIT VS. P.S. JAIN & CO., (2011) 335 ITR 591 HAS HEL D THAT THE CIRCULAR OF THE BOARD IN THIS MATTER SHALL APPLY EVEN IN RESPECT O F OLD REFERENCES WHICH ARE PENDING FOR DECISION. RESPECTFULLY FOLLOWIN G THIS DECISION, THE APPEAL OF THE REVENUE IS DISMISSED IN LIMINE. FOR THE SAKE OF READY REFERENCE, THE JUDGMENT IS REPRODUCED BELOW:- HEARD MR. SANJEEV SABHARWAL, LEARNED COUNSEL FOR THE APPELLANT AND MR. B.N. GOSWAMI, LEARNED COUNSEL FOR THE RESPONDE NT. IT IS FAIRLY STATED BY MR. SANJEEV SABHARWAL, LEARNED COUNSEL F OR THE APPELLANT THAT THE TAX IMPACT WOULD BE RS. 1,80,000/-. IN CIT VS. ASHOK KUMAR MANIBHAI PATEL AND CO . (2009) 317 ITR 386 (MP), A DIVISION BENCH OF THE MADHYA PRADESH HIGH COURT HAS HELD AS THUS (PAGE 390): QUITE APART FROM THE ABOVE , WE MAY ALSO NOTE THAT THIS COURT IN THE CASE OF CWT VS. DR. AJAD KUMAR JAIN (HUF) , SAG AR (W.P. NO. 162 OF 1998) WHILE TAKING NOTE OF THE TAX IMPAC T AND PLACING RELIANCE ON THE DECISION RENDERED IN CIT VS. PITHWA ENGG. WORKS (2005) 276 ITR 519 (BOM) HAS OPINED THUS: 11. THE FACTUAL SCENARIO CAN BE PERCEIVE D FROM ANOTHER ASPECT. SUBMISSION OF MR. A.K. SHRIVASTAVA, LEARNED COUNSEL FOR THE RESPONDENT IS THAT THE TAX IMPACT IS RS. 52,565 AND, THEREFORE, AS PER THE CIRCULAR OF THE CBDT THE REFERENCE NEED NOT BE ADVERTED TO. A DIVISION BENCH OF THE HIGH COURT OF BOMBAY I N THE CASE OF CIT VS. PITHWA ENGG. WORKS, ( 2005) 276 ITR 519 ( BOM) IN PARA 6 EXPRESSED THE VIEW AS UNDER (PAGE 520) : ITA NO. 130(DEL)/2009 3 THIS COURT CAN VERY WELL TAKE JUDICIAL NOTICE OF THE FACT THAT BY PASSAGE OF TIME MONEY VALUE HAS GONE DOWN, THE COST OF LITIGATION EXPENSES HAS GONE UP, THE ASSESSEES ON T HE FILE OF THE DEPARTMENTS HAVE INCREASED; CONSEQUENTLY THE BURDEN ON THE DEPARTMENT HAS ALSO INCREASED TO A TREMENDOUS EXTEN T. THE CORRIDORS OF THE SUPERIOR COURTS ARE CHOKED WITH HU GE PENDENCY OF CASES. IN THIS VIEW OF THE MATTER, THE BOARD HAS RI GHTLY TAKEN A DECISION NOT TO FILE REFERENCES IF THE TAX EFFECT I S LESS THAN RS. 2 LAKHS. THE SAME POLICY FOR OLD MATTERS NEEDS TO BE ADOPTED BY THE DEPARTMENT. IN OUR VIEW, THE BOARDS CIRCULAR DT. 2 7 TH MARCH, 2000, IS VERY MUCH APPLICABLE EVEN TO THE OLD REFERENCES WHICH ARE STILL UNDECIDED. THE DEPARTMENT IS NOT JUSTIFIED IN PROCE EDING WITH THE OLD REFERENCES WHEREIN THE TAX IMPACT IS MINIMAL. T HUS, THERE IS NO JUSTIFICATION TO PROCEED WITH DECADES OLD REFERENCE S HAVING NEGLIGIBLE TAX EFFECT.' JUDGED FROM BOTH ANGLES WE WOULD ANSWER TH E REFERENCE IN THE NEGATIVE IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. KEEPING IN VIEW THE AFORESAID PRINCIPLE, WE ARE N OT INCLINED TO ANSWER THE PRESENT REFERENCE AND ACCORDINGLY THE SAME IS DISMISSED. 3. IN THE RESULT, THE APPEAL IS DISMISSED. SD/- SD/- (RAJPAL YADAV) (K.G. BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER SP SATIA COPY OF THE ORDER FORWARDED TO:- SANJAY CHOUDHARY, HARDWAR. ITO, WARD-2, HARDWAR, UTTRAKHAND. CIT(A) CIT THE DR, ITAT, NEW DELHI. ASSISTANT REGISTRAR.