ACIT, Cir.1, Nashik, Nashik V. Shashi Jadhav Developer Pvt.Ltd., Nashik

ITA 1374/PUN/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 49779 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 5 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-05-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 18-05-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 03-12-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: H K LEUVA
• Keywords: Question of law; Tax effect
• Section: 143(3)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDIC IAL MEMBER AND SHRI G.S. PANNU, ACCOUNTANT MEMBER I.T.A. NO. 1374/PN/09 (ASSTT. YEARS: 2006-07) ASSTT. COMMISSIONER OF IT .. APPELLANT CIR. 1, NASHIK VS. SHASHI JADHAV DEVELOPERS P.LTD. .. RESPONDENT 1 ST FLOOR, BUILDING NO. 3, STADIUM COMPLEX, M.G. ROAD, NASHIK PAN:AAECS 2413C APPELLANT BY: SHRI H.K. LEUVA RESPONDENT BY: NONE ORDER PER G.S. PANNU, AM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS)I, NASHIK DATE D 17.9.2009 WHICH, IN TURN, HAS ARISEN FROM ORDER OF THE ASSESSING OFFICER DATE D 26.12.2007 PASSED UNDER SECTION 143(3) OF THE INCOME-TAX ACT, 1961 (IN SHOR T THE ACT), PERTAINING TO THE ASSESSMENT YEARS 2006-07. 2. DURING THE COURSE OF HEARING OF THE APPEAL, ATTE NTION WAS DRAWN TO THE INSTRUCTION NO. 3/2011 DATED 09.02.2011 ISSUED BY T HE CENTRAL BOARD OF DIRECT TAXES (CBDT) FIXING THE MONETARY LIMITS FOR FILING OF DEPARTMENTAL APPEALS BEFORE THE TRIBUNAL. IN TERMS OF THE SAID INSTRUCTION, MON ETARY LIMIT FOR FILING DEPARTMENTAL APPEAL TO THE TRIBUNAL HAS BEEN FIXED AT RS 3 LAKHS . IN OTHER WORDS, IN CASES WHERE THE TAX EFFECT OF THE ADDITIONS DELETED BY TH E COMMISSIONER OF INCOME-TAX (APPEALS) IS LESS THAN RS 3 LAKHS, NO APPEAL SHALL BE FILED BY THE DEPARTMENT IN SUCH CASES. THE LEARNED DEPARTMENTAL REPRESENTATIVE FAIRLY SUBMITTED THAT THE 2 TAX EFFECT WITH RESPECT TO THE RELIEF ALLOWED BY TH E COMMISSIONER OF INCOME-TAX (APPEALS) IN THE CAPTIONED APPEAL IS BELOW RS 3 L AKHS, THOUGH THE RELIEF ALLOWED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) IS SOUG HT TO BE ASSAILED ON MERITS. 3. IN VIEW OF THE ABOVE PRECEDENT, FACTUALLY THE CA PTIONED DEPARTMENTAL APPEAL IS LIABLE TO BE CONSIDERED TO HAVE BEEN FILE D CONTRARY TO THE CBDT INSTRUCTION DATED 9.2.2011 (SUPRA). THE MUMBAI BENC H OF THE TRIBUNAL IN THE CASE OF ITO V SHRI ASHOK G. DHANDHARIAI, MUMBAI IN ITA NO2460/MUM/2010 DATED 28.2.2011 FOLLOWING THE JUDGMENT OF THE HONB LE BOMBAY HIGH COURT IN THE CASE OF CIT V MADHUKAR K. INAMDAR (HUF) 318 ITR 149 AND CIT V PITHWA ENGINEERING WORKS 276 ITR 519 (BOM) FOUND IT APPROP RIATE TO DISMISS THE DEPARTMENTAL APPEAL ON THE GROUND THAT TAX EFFECT I S LESS THAN RS 3 LAKHS, EVEN IN A CASE WHERE THE DEPARTMENTAL APPEAL WAS FILED PRIO R TO THE DATE OF THE CBDT INSTRUCTION DATED 9.2.2011 (SUPRA). THE FOLLOWING D ISCUSSION IN THE ORDER IS WORTHY OF NOTICE: 5. WE HEARD BOTH THE PARTIES. THE CASE OF CIT VS. CHHAJER PACKAGING & PLASTICS PVT. LTD. 300 ITR RELIED ON BY THE DR IS DISTINGUIS HABLE FROM THE FACTS OF THE PRESENT CASE. AT PARA 12 PAGE 184 OF THE DECISION IN THE CA SE OF CHHAJER PACKAGING & PLASTICS PVT. LTD. IT HAS BEEN HELD AS FOLLOWS: OTHERWISE ALSO, PARAGRAPH OF THIS CIRCULAR ITSELF SAVES CERTAIN APPEALS FROM BEING OBSTRUCTED DUE TO FINANCIAL LIMITS. PARAGRAPH 3 REA DS: THE BOARD HAS ALSO DECIDED THAT IN CASES INVOLVING SUBSTANTIAL QUESTION OF LAW OF IMPORTANCE AS WELL AS IN CASES WHERE THE SAME QUESTION OF LAW WILL REPEATEDLY ARISE, EITHER IN THE CASE CONCERNED OR IN SIMILAR CASES, SHOULD BE SEPARATELY CONSIDERED ON THE MERITS WITHO UT BEING HINDERED BY THE MONETARY LIMITS. IT IS EVIDENT THAT, WHENEVER THERE IS A SUBSTANTIAL QUESTION OF LAW, OR QUESTION OF LAW WHICH IS LIKELY TO RECUR IN FUTURE, THE DEPARTM ENT IS NOT PROHIBITED FROM FILING AND PURSUING APPEALS. WE BELIEVE THAT THE SAVING CL AUSE SAVES THE PRESENT APPEAL SINCE IT INVOLVES A QUESTION OF LAW REGARDIN G INTERPRETATION OF SECTION 275(1)(C) OF THE ACT, AND MORE PARTICULARLY THE ASP ECT OF MANNER IN WHICH THE LIMITATION SHOULD BE COMPUTED IN THE LIGHT OF THE S AID PROVISIONS. WE HAVE, THEREFORE, PROCEEDED TO HEAR THE ADVOCATES ON THE M ERITS. IN OUR OPINION, THE CASE OF CIT V CHHAJER WAS WITH RESPECT OF INTERPRETATION OF 275(1)(C) OF THE ACT AND HENCE CAME UNDER THE EXCEP TION CLAUSE UNDER THE CBDT CIRCULAR AND WAS NOT OBSTRUCTED BY THE MONETARY LIM IT OF RS 3 LAKHS PRESCRIBED BY THE CIRCULAR. THEREFORE THE CASE OF 300 ITR 180 IS INAPPLICABLE TO THE FACTS OF OUR CASE. FURTHER INSTRUCTION NO. 5 DT. 15.5.2008 FIXIN G THE MONETARY LIMIT AT RS 2 LAKHS IS SIMILAR TO THAT OF INSTRUCTION NO. 3 DATED 9.2.2011 WHICH THE ASSESSEE HAS BROUGHT TO OUR NOTICE IN SUPPORT OF HIS CONTENT ION. SINCE BOTH THE INSTRUCTION NOS. 5 & 3 ARE IDENTICAL, THE RATIO OF THE DECISION IN THE CASE OF CIT V PITHWA ENGG. WORK WHICH DEALS WITH INSTRUCTION NO. 5 DT. 1 5.5.2008 SHALL EQUALLY APPLY TO THE PRESENT CASE WHICH FALLS UNDER LNSTRUCTION N O. 3 DATED 9.2.2011. FOLLOWING 3 THE RATIO OF THE DECISION IN THE CASE OF CIT V PITH WA ENGG. WORK WHEREIN IT HAS BEEN HELD THAT IN OUR VIEW, THE BOARDS CIRCULAR D T. 27 TH MARCH, 2000 IS VERY MUCH APPLICABLE EVEN TO THE OLD REFERENCES WHICH ARE STI LL UNDECIDED, WE DISMISS THE DEPARTMENTAL APPEAL ON THE GROUND THAT THE TAX EFFE CT IS LESS THAN 3 LAKHS. 7. FOLLOWING THE AFORESAID PRECEDENT, THE CAPTIONED APPEAL FILED BY THE REVENUE IS LIABLE TO BE DISMISSED IN VIEW OF CBDT I NSTRUCTION NO. 3 DATED 9.2.2011 (SUPRA) AS THE TAX EFFECT WITH RESPECT TO THE QUANTUM OF RELIEF ALLOWED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) IN THE IMP UGNED YEAR IS BELOW RS 3 LAKHS AND IT HAS NOT BEEN SHOWN THAT THE APPEAL FAL LS UNDER ANY OF THE EXCEPTIONS PROVIDED IN PARA 8 OF THE CBDT INSTRUCTION (SUPRA). WE ORDER ACCORDINGLY. 8. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. DECISION PRONOUNCED IN THE OPEN COURT ON THIS 27TH DAY OF MAY 2011. SD/- SD/- (SHAILENDRA KUMAR YADAV) JUDICIAL MEMBER (G.S. PANNU) ACCOUNTANT MEMBER PUNE: DATED: 27 TH MAY, 2011 B COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. ACIT CIR.1 NASHIK 3. THE CIT(A)-I NASHIK 4. THE CIT-I NASHIK 5. THE D.R, B BENCH, PUNE TRUE COPY BY ORDER ASSISTANT REGISTRAR ITAT, PUNE BENCHES, PUNE