Income-tax Officer, Ward - 1 (3), Nashik V. Zakirhussain M. Khan, Nashik

ITA 1562/PUN/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8126 (ITAT-PUNE)
• Duration Of Justice: 3 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2010-2011
• Appeal Filed On: 03-10-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BHARAT DEORAJ SH E G AONKAR
• Keywords: Tax effect
• Section: 37(1); 144

Judgement Text

] IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH SMC, PUNE BEFORE SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER . / ITA NO.1562/PUN/2019 / ASSESSMENT YEAR : 2010-11 THE INCOME TAX OFFICER, WARD 1(3), NASHIK. . / APPELLANT V/S SHRI ZAKIRHUSSAIN MUNAWWARHUSSAIN KHAN, PROP. OF NEW SEHAR STEEL WIRE, SURVEY NO.67/1, NANDUR NAKA PANCHAVATI, NASHIK 422 003. PAN : ANHPK1524H. . / RESPONDENT ASSESSEE BY : NONE. REVENUE BY : SHRI BHARAT DEORAJ SHEGAONKAR / ORDER PER ANIL CHATURVEDI, AM : 1. THIS APPEAL FILED BY REVENUE IS EMANATING OUT OF THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) 1, NASHIK DATED 22.0 7.2019 FOR A.Y. 2010-11. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ON RE CORD ARE AS UNDER :- ASSESSEE IS AN INDIVIDUAL AND STATED TO BE ENGAGED IN THE BUSINESS OF MANUFACTURING / TRADING OF STEEL PRODUCTS. ASS ESSEE FILED HIS RETURN OF INCOME FOR A.Y. 2010-11 ON 10.05.2010 DECLAR ING TOTAL / DATE OF HEARING : 22.01.2020 / DATE OF PRONOUNCEMENT: 22.01.2020 2 INCOME OF RS.2,14,690/-. THE CASE WAS SELECTED FOR SCRUTIN Y AND CONSEQUENTLY THE ASSESSMENT WAS COMPLETED U/S 144 (1) R.W.S 147 OF THE ACT VIDE ORDER DATED 25.03.2015 AND THE TOTAL INCO ME WAS DETERMINED AT RS.40,17,950/- BY MAKING ADDITION OF RS.38,03,2 60/-. AGGRIEVED BY THE ORDER OF AO, ASSESSEE CARRIED THE MATT ER BEFORE LD.CIT(A), WHO VIDE ORDER DATED 22.07.2019 (IN APPEAL NO.NSK/ CIT(A)- 1/404/2015-16) GRANTED PARTIAL RELIEF TO THE ASSESSEE WHE REBY HE UPHELD THE ADDITION OF RS.4,72,282/- AND GRANTED PARTIAL RELIE F OF RS.33,26,978/-. AGGRIEVED BY THE ORDER OF LD.CIT(A), REVENU E IS NOW IN APPEAL AND HAS RAISED THE FOLLOWING GROUNDS. 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES O F THE CASE AND IN LAWS THE LD.CIT(A) IS JUSTIFIED IN RESTRICTING THE ADDITION @ 12.5% OF PURCHASES FROM THE ALLEGED HAWALA DEALERS INSTEAD O F 100% OF DISALLOWANCE MADE BY AO U/S 37(1) OF THE ACT. 2. THE ORDER OF THE CIT(A) MAY BE VACATED AND THAT OF THE ASSESSING OFFICER MAY BE RESTORED. 3. ON THE DATE OF HEARING, NONE APPEARED ON BEHALF OF THE ASSESSEE NOR ANY ADJOURNMENT APPLICATION WAS FILED DESPITE SERVICE OF NOTICE. I THEREFORE PROCEED TO DECIDE THE PRESENT APPEAL BASED O N THE MATERIAL AVAILABLE ON RECORD AND AFTER HEARING LD. D.R. 4. THE PERUSAL OF THE ASSESSMENT ORDER REVEAL THAT THE TAX EFFECT ON THE GROUNDS RAISED BY THE REVENUE WAS BELOW THE LIMIT PR ESCRIBED BY RECENT CBDT CIRCULAR NO.17/2019 DT.08.08.2019. WHEN THIS WAS POINTED OUT TO LD. D.R., HE FAIRLY ADMITTED THAT THE TAX E FFECT ON THE GROUNDS RAISED BY REVENUE IS BELOW THE LIMIT PRESCRIBED BY THE RECENT CBDT CIRCULAR NO.17/2019 DT.08.08.2019 AND THEREFORE THE A PPEAL BE DECIDED ACCORDINGLY. 3 5. I HAVE HEARD THE LD. D.R. AND PERUSED THE MATERIAL AVAILABLE ON RECORD. ON PERUSING THE GROUNDS OF APPEAL RAISED BY THE REVENUE, I FIND THAT REVENUE IS AGGRIEVED BY THE ORDER OF LD. CIT(A) IN RESPECT OF THE RELIEF GIVEN BY HIM. AS PER THE RECENT ANNOUNCEMENT OF CENTRAL BOARD OF DIRECT TAXES (CBDT) DATED 08.08.2019 (CIRCULAR NO. 17 OF 2019), NO DEPARTMENT APPEALS ARE TO BE FILED AGAINST RELIEF G IVEN BY LD. CIT(A) BEFORE THE INCOME TAX APPELLATE TRIBUNAL UNLESS THE TAX EFFECT, EXCLUDING INTEREST, EXCEEDS RS.50 LAKHS AND IT FURTHER STA TES THAT THE INSTRUCTIONS WILL APPLY RETROSPECTIVELY TO THE PENDING APP EALS ALSO. I FIND THAT IN THE PRESENT CASE THE TAX EFFECT INVOLVED IS LE SS THAN RS.50 LAKHS. IN THE ABSENCE OF ANY MATERIAL PLACED ON RECORD BY THE REVENUE TO DEMONSTRATE THAT THE ISSUE IN THE PRESENT APPEAL IS COVERED BY EXCEPTIONS PROVIDED IN PARA 10 OF THE AFORESAID CBDT CIRCU LAR, I AM OF THE VIEW THAT THE MONETARY LIMIT PRESCRIBED BY THE INSTRU CTIONS OF THE AFORESAID CBDT CIRCULAR WOULD BE APPLICABLE TO THE PRESENT APPEAL OF THE DEPARTMENT. I THEREFORE HOLD THE PRESENT APPEAL O F REVENUE TO BE NOT MAINTAINABLE ON ACCOUNT OF LOW TAX EFFECT. HOWEVER, IN C ASE THERE IS ANY ERROR IN THE COMPUTATION OF THE TAX EFFECT INVOLVED OR IF FOR ANY REASON, THE AFORESAID CBDT CIRCULAR IS NOT APPLICABLE, IT WOULD BE OPEN TO THE REVENUE TO SEEK REVIVAL OF THE APPEAL. THUS, THE GROUNDS OF THE REVENUE ARE DISMISSED. 6. IN THE RESULT, THE APPEAL OF REVENUE IS DISMISSED. ORDER PRONOUNCED ON 22 ND DAY OF JANUARY, 2020. SD /- ( ANIL CHATURVEDI ) ' / ACCOUNTANT MEMBER PUNE; DATED : 22 ND JANUARY, 2020. YAMINI 4 #$%&'(' % / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT 3. 4. 5 6. CIT(A)-1, NASHIK. PR. CIT-1, NASHIK. '#$ %%&',) &', *+ / DR, ITAT, SMC PUNE; $-.// GUARD FILE. / BY ORDER // TRUE COPY // 012%3&4 / SR. PRIVATE SECRETARY ) &', / ITAT, PUNE.