Dy. CIT, Aurangabad V. Shri Jitendra Motilal Bansal, Jalna

ITA 1435/PUN/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 2697 (ITAT-PUNE)
• Duration Of Justice: 2 year(s) 7 month(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 17-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 17-02-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 08-07-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: MANISH KUMAR SINHA
• Keywords: Tax effect
• Section: 12A

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE . . , ! , # $ BEFORE SHRI R.K. PANDA, AM AND SHRI VIKAS AWASTHY, JM . / ITA NO.1435/PN/2013 #& & / ASSESSMENT YEAR : 2010-11 DY.CIT, CENTRAL CIRCLE, AURANGABAD . / APPELLANT V/S SHRI JITENDRA MOTILAL BANSAL, 42, PRITI SUDHA NAGAR, JALNA 431 203 PAN NO.AATPA5251A . / RESPONDENT / ASSESSEE BY : SHRI NIKHIL PATHAK / REVENUE BY : SHRI MANISH KUMAR SINHA / ORDER PER R.K.PANDA, AM : THIS APPEAL FILED BY THE REVENUE IS DIRECTED AGAINST THE OR DER DATED 01-04-2013 PASSED BY THE CIT(A), AURANGABAD RELAT ING TO ASSESSMENT YEAR 2010-11. 2. THE LD. COUNSEL FOR THE ASSESSEE AT THE OUTSET SUBM ITTED THAT THE AO HAS LEVIED PENALTY OF RS.10,50,000/- U/S.271AAA. IN APPEAL THE LD.CIT(A) SUSTAINED THE PENALTY AT RS.50,000/- THEREBY GIVING RELIEF OF RS.10 LAKHS. REFERRING TO THE RECENT CBDT CIRCULAR NO.21/2015 DATED 10-12-2015 PRESCRIBING MONETARY LIMIT FOR FILING OF APPEALS BY THE REVENUE HE SUBMITTED THAT THE TAX EFFECT IN THE APPEAL FILED BY THE REVENUE IN THE INSTANT CASE IS EXACTLY RS. 10 LAKHS. / DATE OF HEARING :17.02.2016 / DATE OF PRONOUNCEMENT:17.02.2016 2 ITA NO.1435/PN/2013 THEREFORE, IN VIEW OF THE GUIDELINES ISSUED BY THE CBDT FOR FILLING OF APPEALS BY REVENUE WHERE THE TAX EFFECT IS RS.10 LAKHS O R LESS, THE APPEAL FILED BY THE REVENUE IS NOT MAINTAINABLE. HE ACCORDING LY SUBMITTED THAT THE APPEAL OF THE REVENUE BE DISMISSED O N THE ISSUE OF MONETARY LIMIT. 3. THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVEN UE FAIRLY CONCEDED THAT THE TAX EFFECT IN THE APPEAL FILED BY THE RE VENUE IS EXACTLY RS.10 LAKHS. THEREFORE, THE APPEAL FILED BY THE R EVENUE IS NOT MAINTAINABLE IN VIEW OF THE CIRCULAR ISSUED BY CBDT. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE RECORD. ADMITTEDLY, THE TAX EFFECT IN THE INSTANT APPEAL IS LESS THA N RS.10 LAKHS. IN THIS BACKGROUND, WE HAVE TO CONSIDER THE CIRCU LAR NO.21/2015 DATED 10.12.2015 OF CBDT. THE CBDT VIDE THE S AID CIRCULAR HAS ANNOUNCED THAT SUBJECT TO CERTAIN EXCEPTIO NS, NO DEPARTMENTAL APPEAL WOULD BE FILED AGAINST THE RELIEF GIVEN BY THE CIT(A) BEFORE THE TRIBUNAL, WHERE THE TAX EFFECT EXCLUDING INTEREST D OES NOT EXCEED RS.10 LAKHS. THE SAID INSTRUCTIONS ARE MADE A PPLICABLE NOT ONLY TO THE FUTURE APPEALS TO BE FILED BY THE REVENU E BUT EVEN TO THE PENDING APPEALS WHERE THE TAX INVOLVED IN EACH OF TH E APPEAL DOES NOT EXCEED RS.10 LAKHS, THE SAME ARE INSTRUCTED NOT TO BE PRESSED OR TO BE WITHDRAWN BY THE REVENUE. IN VIEW THEREOF, WHERE AN APPEAL IS PENDING BEFORE THE TRIBUNAL, IRRESPECTIVE OF THE YEAR TO WH ICH IT RELATES, THE SAID INSTRUCTIONS OF THE CBDT WOULD BE APPLICAB LE AND THE APPEALS OF THE REVENUE PENDING BEFORE THE TRIBUNAL WHERE THE TAX EFFECT IS LESS THAN RS.10 LAKHS WOULD BECOME NULLITY. THE RELE VANT EXTRACT OF THE CIRCULAR IS AS UNDER:- 3. HENCEFORTH, APPEALS/SLPS SHALL NOT BE FILED IN CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY LIMITS GIVEN UN DER:- 3 ITA NO.1435/PN/2013 S NO APPEALS IN INCOME - TAX MATTERS MONETARY LIMIT (IN RS.) 1 BEFORE APPELLATE TRIBUNAL 10,00,000/ - 2 BEFORE HIGH COURT 20,00,000/ - 3 BEFORE SUPREME COURT 25,00,000/ - IT IS CLARIFIED THAT AN APPEAL SHOULD NOT BE FILED MERELY BECAUSE THE TAX EFFECT IN A CASE EXCEEDS THE MONETARY LIMITS PRESCRIBED AB OVE. FILING OF APPEAL IN SUCH CASES IS TO BE DECIDED ON MERITS OF THE CASE. 4. FOR THIS PURPOSE, TAX EFFECT MEANS THE DIFFERE NCE BETWEEN THE TAX ON THE TOTAL INCOME ASSESSED AND THE TAX THAT WOULD HAVE BEEN CHARGEABLE HAD SUCH TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME IN RESPECT OF THE ISSUES AGAINST WHICH APPEAL IS INTENDED TO BE F ILED (HEREINAFTER REFERRED TO AS DISPUTED ISSUES). HOWEVER, THE TAX WILL NO T INCLUDE ANY INTEREST THEREON, EXCEPT WHERE CHARGEABILITY OF INTEREST ITS ELF IS IN DISPUTE. IN CASE THE CHARGEABILITY OF INTEREST IS THE ISSUE UNDER DI SPUTE, THE AMOUNT OF INTEREST SHALL BE THE TAX EFFECT. IN CASES WHERE R ETURNED LOSS IS REDUCED OR ASSESSED AS INCOME, THE TAX EFFECT WOULD INCLUDE NO TIONAL TAX ON DISPUTED ADDITIONS. IN CASE OF PENALTY ORDERS, THE TAX EFFE CT WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE ORDER TO BE APPEA LED AGAINST. 5. THE ASSESSING OFFICER SHALL CALCULATE THE TAX EF FECT SEPARATELY FOR EVERY ASSESSMENT YEAR IN RESPECT OF THE DISPUTED IS SUES IN THE CASE OF EVERY ASSESSMENT. IF, IN THE CASE OF AN ASSESSEE, THE DI SPUTED ISSUES ARISE IN MORE THAN ONE ASSESSMENT YEAR, APPEAL, CAN BE FILED IN R ESPECT OF SUCH ASSESSMENT YEAR OR YEARS IN WHICH THE TAX EFFECT IN RESPECT OF THE DISPUTED ISSUES EXCEEDS THE MONETARY LIMIT SPECIFIED IN PARA 3. NO APPEAL SHALL BE FILED IN RESPECT OF AN ASSESSMENT YEAR OR YEARS IN WHICH THE TAX EFFECT IS LESS THAN THE MONETARY LIMIT SPECIFIED IN PARA 3. IN OTHER WORDS, HENCEFO RTH, APPEALS CAN BE FILED ONLY WITH REFERENCE TO THE TAX EFFECT IN THE RELEVA NT ASSESSMENT YEAR. HOWEVER, IN CASE OF A COMPOSITE ORDER OF ANY HIGH C OURT OF APPELLATE AUTHORITY, WHICH INVOLVES MORE THAN ONE ASSESSMENT YEAR AND COMMON ISSUES IN MORE THAN ONE ASSESSMENT YEAR, APPEAL SHA LL BE FILED IN RESPECT OF ALL SUCH ASSESSMENT YEARS EVEN IF THE TAX EFFECT IS LESS THAN THE PRESCRIBED MONETARY LIMITS IN ANY OF THE YEAR(S), IF IT IS DEC IDED TO FILE APPEAL IN RESPECT OF THE YEAR(S) IN WHICH TAX EFFECT EXCEEDS THE MO NETARY LIMIT PRESCRIBED. IN CASE WHERE A COMPOSITE ORDER / JUDGMENT INVOLVES MO RE THAN ONE ASSESSEE, EACH ASSESSEE SHALL BE DEALT WITH SEPARATELY. 5. THE CBDT HAS FURTHER CLARIFIED THAT IN CASE THE DISPUTED ISSUE ARISES IN MORE THAN ONE ASSESSMENT YEAR, THEN THE APPE AL CAN BE FILED IN RESPECT OF SUCH ASSESSMENT YEAR OR YEARS IN WHICH TH E TAX EFFECT IN RESPECT OF THE DISPUTED ISSUE EXCEEDS THE MONETARY LIMIT SPECIFIED IN PARA 3 I.E. RS.10 LAKHS BEFORE THE TRIBUNAL. IT IS FURTHER DIR ECTED THAT HENCEFORTH, THE APPEALS CAN BE FILED BY THE REVENUE ONLY WITH REFERENCE TO THE TAX EFFECT IN THE RELEVANT ASSESSMENT Y EAR. HOWEVER, 4 ITA NO.1435/PN/2013 IN CASE OF A COMPOSITE ORDER OF ANY HIGH COURT OR APPELLA TE AUTHORITY, WHICH INVOLVES MORE THAN ONE ASSESSMENT YEAR AND COMMO N ISSUES IN MORE THAN ONE ASSESSMENT YEAR, THEN APPEAL SHALL BE FILED IN RESPECT OF SUCH ASSESSMENT YEAR, EVEN IF THE TAX EFFECT IS LESS THA N THE PRESCRIBED MONETARY LIMITS IN ANY OF THE YEAR(S), IF IT IS DECIDE D TO FILE APPEAL IN RESPECT OF THE YEAR(S) IN WHICH TAX EFFECT EXCEE DS THE MONETARY LIMIT PRESCRIBED. WHERE A COMPOSITE ORDER / JUD GMENT INVOLVES MORE THAN ONE ASSESSEE, THEN EACH ASSESSEE SH ALL BE DEALT WITH SEPARATELY. IT IS ALSO PROVIDED FURTHER VIDE PARAS 6 AND 7 THAT WHERE THE APPEAL BEFORE THE TRIBUNAL WAS NOT FILED ONLY O N ACCOUNT OF TAX EFFECT BEING LESS THAN SPECIFIED MONETARY LIMIT, THEN THE INCOME- TAX DEPARTMENT SHALL NOT BE PRECLUDED FROM FILING AN APPEAL AGAINST THE DISPUTED ISSUES IN THE CASE OF THE SAME ASSESSEE FO R ANY OTHER ASSESSMENT YEAR, OR IN CASE OF ANY OTHER ASSESSEE FOR T HE SAME OR ANY OTHER ASSESSMENT YEAR, IF THE TAX EFFECT EXCEEDS THE SPE CIFIED MONETARY LIMITS. THE CBDT HAS FURTHER VIDE PARA 8 SPECIFIED THE ISSUE WHICH SHOULD BE CONTESTED ON MERITS NOTWITHSTANDING THAT THE TAX EFFECT ENTAILED IS LESS THAN THE MONETARY LIMITS SPECIFIED. FURTHER , THE SPECIFIED MONETARY LIMITS AS PER PARA 9 WOULD NOT APPLY TO WRIT MATTERS AND DIRECT TAX MATTERS OTHER THAN INCOME TAX AND ALSO IS NOT APPLICABLE TO THE APPEALS WHERE TAX EFFECT IS NOT QUANTIFIABL E OR NOT INVOLVED, SUCH AS THE CASE OF REGISTRATION OF TRUSTS OR INS TITUTIONS UNDER SECTION 12A OF THE ACT. IN SUCH CASES, THE DECISIO N TO FILE AN APPEAL IS TO BE TAKEN ON THE MERITS OF A PARTICULARS CAS E. THE PARAS 6 TO 9 OF THE CIRCULAR READ AS UNDER:- 6. IN A CASE WHERE APPEAL BEFORE A TRIBUNAL OR A C OURT IS NOT FILED ONLY ON ACCOUNT OF THE TAX EFFECT BEING LESS THAN THE MO NETARY LIMIT SPECIFIED ABOVE, THE COMMISSIONER OF INCOME-TAX SHALL SPECIFI CALLY RECORD THAT EVEN THOUGH THE DECISION IS NOT ACCEPTABLE, APPEAL IS NO T BEING FILED ONLY ON THE CONSIDERATION THAT THE TAX EFFECT IS LESS THAN THE MONETARY LIMIT SPECIFIED IN THIS INSTRUCTION. IN SUCH CASES, THERE WILL BE NO PRESUMPTION THAT THE INCOME-TAX DEPARTMENT HAS ACQUIESCED IN THE DECISIO N ON THE DISPUTED 5 ITA NO.1435/PN/2013 ISSUES. THE INCOME-TAX DEPARTMENT SHALL NOT BE PRE CLUDED FROM FILING AN APPEAL AGAINST THE DISPUTED ISSUES IN THE CASE OF T HE SAME ASSESSEE FOR ANY OTHER ASSESSMENT YEAR, OR IN THE CASE OF ANY OTHER ASSESSEE FOR THE SAME OR ANY OTHER ASSESSMENT YEAR, IF THE TAX EFFECT EXCEED S THE SPECIFIED MONETARY LIMITS. 7. IN THE PAST, A NUMBER OF INSTANCES HAVE COME TO THE NOTICE OF THE BOARD, WHEREBY AN ASSESSEE HAS CLAIMED RELIEF FROM THE TRIBUNAL OR THE COURT ONLY ON THE GROUND THAT THE DEPARTMENT HAS IM PLICITLY ACCEPTED THE DECISION OF THE TRIBUNAL OR COURT IN THE CASE OF TH E ASSESSEE FOR ANY OTHER ASSESSMENT YEAR OR IN THE CASE OF ANY OTHER ASSESSE E FOR THE SAME OR ANY OTHER ASSESSMENT YEAR, BY NOT FILING AN APPEAL ON T HE SAME DISPUTED ISSUES. THE DEPARTMENTAL REPRESENTATIVES/COUNSELS MUST MAKE EVERY EFFORT TO BRING TO THE NOTICE OF THE TRIBUNAL OR THE COURT TH AT THE APPEAL IN SUCH CASES WAS NOT FILED OR NOT ADMITTED ONLY FOR THE REASON O F THE TAX EFFECT BEING LESS THAN THE SPECIFIED MONETARY LIMIT AND, THEREFORE, N O INFERENCE SHOULD BE DRAWN THAT THE DECISIONS RENDERED THEREIN WERE ACCE PTABLE TO THE DEPARTMENT. ACCORDINGLY, THEY SHOULD IMPRESS UPON THE TRIBUNAL OR THE COURT THAT SUCH CASES DO NOT HAVE ANY PRECEDENT VAL UE. AS THE EVIDENCE OF NOT FILING APPEAL DUE TO THIS INSTRUCTION MAY HAVE TO BE PRODUCED IN COURTS, THE JUDICIAL FOLDERS IN THE OFFICE OF CSIT MUST BE MAINTAINED IN A SYSTEMIC MANNER FOR EASY RETRIEVAL. 8. ADVERSE JUDGMENTS RELATING TO THE FOLLOWING ISSU ES SHOULD BE CONTESTED ON MERITS NOTWITHSTANDING THAT THE TAX EF FECT ENTAILED IS LESS THAN THE MONETARY LIMITS SPECIFIED IN PARA 3 ABOVE OR TH ERE IS NO TAX EFFECT: (A) WHERE THE CONSTITUTIONAL VALIDITY OF THE PROVISIONS OF AN ACT OR RULE ARE UNDER CHALLENGE, OR (B) WHERE BOARDS ORDER, NOTIFICATION, INSTRUCTION OR C IRCULAR HAS BEEN HELD TO BE ILLEGAL OR ULTRA VIRES, OR (C) WHERE REVENUE AUDIT OBJECT IN THE CASE HAS BEEN ACC EPTED BY THE DEPARTMENT, OR (D) WHERE THE ADDITION RELATES TO UNDISCLOSED FOREIGN A SSETS / BANK ACCOUNTS. 9. THE MONETARY LIMITS SPECIFIED IN PARA 3 ABOVE SH ALL NOT APPLY TO WRIT MATTERS AND DIRECT TAX MATTERS OTHER THAN INCOME TA X. FILING OF APPEALS IN OTHER DIRECT TAX MATTERS SHALL CONTINUE TO BE GOVER NED BY RELEVANT PROVISIONS OF STATUTE & RULES. FURTHER, FILING OF APPEAL IN CASES OF INCOME TAX, WHERE THE TAX EFFECT IS NOT QUANTIFIABLE OR NO T INVOLVED, SUCH AS THE CASE OF REGISTRATION OF TRUSTS OR INSTITUTIONS UNDER SEC TION 12A OF THE IT ACT, 1961, SHALL NOT BE GOVERNED BY THE LIMITS SPECIFIED IN PA RA 3 ABOVE AND DECISION TO FILE APPEAL IN SUCH CASES MAY BE TAKEN ON MERITS OF A PARTICULAR CASE. 6. THE RETROSPECTIVE OPERATION OF THE INSTRUCTIONS TO PEN DING APPEALS IS PROVIDED IN PARA 10 OF THE CIRCULAR, WHICH READS AS UNDER:- 10. THIS INSTRUCTION WILL APPLY RETROSPECTIVELY TO PENDING APPEALS AND APPEALS TO BE FILED HENCEFORTH IN HIGH COURTS / TRI BUNALS. PENDING APPEALS BELOW THE SPECIFIED TAX LIMITS IN PARA 3 ABOVE MAY BE WITHDRAWN / NOT PRESSED. APPEALS BEFORE THE SUPREME COURT WILL BE GOVERNED BY THE INSTRUCTIONS ON THIS SUBJECT, OPERATIVE AT THE TIME WHEN SUCH APPEAL WAS FILED. 6 ITA NO.1435/PN/2013 7. IN VIEW OF THE ABOVE SAID INSTRUCTIONS OF CBDT WHERE THE TAX EFFECT IS RS. 10 LAKHS OR LESS, THE APPEAL FILED BY THE REVEN UE, WHICH IS PENDING BEFORE THE TRIBUNAL IS NOT TO BE PRESSED OR WITHD RAWN BY THE REVENUE AUTHORITIES. SINCE THE TAX EFFECT IN THE INSTANT A PPEAL FILED BY THE REVENUE IS ADMITTEDLY RS.10 LAKHS, THEREFORE, IN VIEW OF THE INSTRUCTIONS OF CBDT AND THE ENTIRETY OF FACTS, WE DISMISS THE APPEAL FILED BY THE REVENUE AS NOT MAINTAINABLE. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT AT THE TIME OF HE ARING ITSELF, I.E. ON 17-02-2016. SD/- SD/- ( VIKAS AWASTHY ) ( R.K. PANDA ) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE ; DATED : 17 TH FEBRUARY, 2016. ) *#,! -! / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. THE CIT(A) , AURANGABAD 4. 5. 6. THE CIT, AURANGABAD $ ''(, (, / DR, ITAT, B PUNE; - / GUARD FILE. / BY ORDER , // TRUE COPY // // TRUE COPY // // $ ' //TRUE COPY // /0 ' ( / SR. 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