ITO, Ward - 30(4), Kolkata, Kolkata V. Smt. Nilima Singh, Kolkata

ITA 1629/KOL/2010

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 48048 (ITAT-KOLKATA)
• Duration Of Justice: 7 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-04-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 17-08-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: H N SINGH
• Assessee Lawyers: DIPAK KAR
• Keywords: Audit objection; Tax effect

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : KOLKATA ( ) . . , , . . , , ) [BEFORE HONBLE SRI B.R. MITTAL, J.M. & HONBLE SR I B.K. HALDAR, A.M.] / I.T.A NO. 1629/KOL/2010 !' #$ / ASSESSMENT YEAR : 2005-06 INCOME TAX OFFICER, WARD-30(4), KOLKATA -VS.- SMT. NILIMA SINGH, KOLKATA (PAN : ASXPS 9045 G) ( %& /APPELLANT ) ( '(%& / RESPONDENT ) FOR THE APPELLANT : SHRI H.N. SINGH, SR. D.R. FOR THE RESPONDENT : SHRI DIPAK KAR, A.R. ) / ORDER PER SHRI B. R. MITTAL, JUDICIAL MEMBER/ . . , :- THE DEPARTMENT HAS FILED THIS APPEAL FOR THE ASSES SMENT YEAR 2005-06 AGAINST THE ORDER OF LD. COMMISSIONER OF INCOME-TAX (APPEALS)-XIV, KO LKATA DATED 30.04.2010. 2. IT IS OBSERVED THAT THE TAX EFFECT IN THIS APPEA L IS LESS THAN RS.2 LAKHS. HENCE, THE LD. D.R. WAS ASKED AS TO WHETHER ANY OF THE EXCEPTIONS LAID DOWN IN PARA 8 OF CBDT CIRCULAR NO. 279/MISC.-64/05-ITJ DATED 24.10.05 READ WITH INSTRU CTION NO.5 OF 2008 DATED 15.05.2008 ARE APPLICABLE TO CONSIDER THIS APPEAL ON MERITS. THE D EPARTMENT IN ABOVE INSTRUCTION DATED 15.05.2008 HAS SPECIFIED 3 GROUNDS IN PARA 8 STATIN G THAT THE APPEAL COULD BE FILED BEFORE THE TRIBUNAL WHERE THE TAX EFFECT IS LESS THAN RS.2.00 LAKHS ONLY AND THE SAME ARE AS UNDER :- (A) WHERE THE CONSTITUTIONAL VALIDITY OF THE PROVIS IONS OF AN ACT OR RULE ARE UNDER CHALLENGE. (B) WHERE BOARDS ORDER, NOTIFICATION, INSTRUCTION OF CIRCULAR HAS BEEN HELD TO BE ILLEGAL OR ULTRA VIRES. (C) WHERE REVENUE AUDIT OBJECTION IN THE CASE HAS B EEN ACCEPTED BY THE DEPARTMENT. 3. LD. D.R. FAIRLY CONCEDED THAT NONE OF THE ABOVE CONDITIONS ARE APPLICABLE IN RESPECT OF THIS APPEAL. ITA NO.1629/KOL./2010 2 4. THERE IS NO DISPUTE ON THE FACT THAT THE CBDT VI DE INSTRUCTION NO. 2/2005 DATED 24.10.2005, ISSUES GUIDELINES TO THE REVENUE AUTHOR ITIES WITH REGARD TO FILING OF APPEALS BEFORE THE TRIBUNAL, HIGH COURT AND THE SUPREME COURT. FRO M THE SAID INSTRUCTIONS, IT IS EVIDENT THAT SINCE 1987, THE CBDT HAS BEEN INSTRUCTING ITS OFFIC ERS NOT TO FILE THE APPEAL WHERE THE TAX EFFECT IS BELOW CERTAIN MONETARY LIMITS. VIDE INSTRUCTION NO. 1903 DATED 28.10.1992 THE MONETARY LIMITS WAS REVISED UPWARD AND THE OFFICERS WERE DIR ECTED NOT TO FILE APPEAL BEFORE THE INCOME TAX APPELLATE TRIBUNAL WHERE THE TAX EFFECT WAS BEL OW RS.25,000/-. THE ABOVE MONETARY LIMIT WAS FURTHER REVISED UPWARD BY INSTRUCTION NO.1979 D ATED 27.3.2000 AND THE OFFICERS WERE DIRECTED NOT TO FILE THE APPEAL TO ITAT WHERE THE T AX EFFECT IS BELOW RS. 1,00,000/-. THEREAFTER IN PARTIAL MODIFICATION OF THE ABOVE INSTRUCTION, T HE BOARD VIDE INSTRUCTION NO.2/2005 DATED 24.10.2005 HAS FURTHER RAISED THE ABOVE MONETARY LI MIT TO RS.2,00,000/- WITH THE SAME DIRECTIONS. THUS THE C.B.D.T SINCE 1987 HAS NOT ONL Y TAKEN A CONSISTENT APPROACH OF INSTRUCTING ITS OFFICERS FOR NOT FILING THE APPEAL WHERE THE TA X EFFECT IS BELOW THE MONETARY LIMIT, BUT SUCH MONETARY LIMIT IS ALSO REVISED UPWARD FROM TIME TO TIME. THE CIRCULAR UNDER INSTRUCTION NO.1979 DATED 27-3-2000 WAS CONSIDERED BY THE BOMBA Y HIGH COURT IN THE CASE OF CAMCO COLOUR CO. 254 ITR 565 AND THEIR LORDSHIPS HELD AT PAGE 568 AS UNDER :- IT APPEARS THAT DESPITE THE ABOVE CIRCULAR, THE RE VENUE HAS CHOSEN TO FILE THE PRESENT APPEAL KNOWINGLY FULLY WELL THAT THE CO RRIDORS OF THE COURTS ARE FLOODED WITH PENDING LITIGATIONS. THE PRESENTATION OF THIS APPEAL IS QUITE CONTRARY TO THE INSTRUCTION ISSUED IN THE CIRCULAR, WHICH IS BINDING ON THE REVENUE. IN THE ABOVE VIEW OF THE MATTER, CONSIDERING THE IN STRUCTIONS ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES, WE ARE SATISFIED THA T THE BOARD HAS TAKEN A POLICY DECISION NOT TO FILE APPEAL IN A TYPE OF CAS E IN HAND AND THE SAME IS BINDING ON THE REVENUE (APPELLANT HEREIN). IN THE R ESULT, WE DISMISS THIS APPEAL ON THIS COUNT IN LIMINE WITH NO ORDER AS TO COSTS. 5. WE FIND THAT RECENTLY THE APEX COURT HAS CONSID ERED THE EFFECT OF CIRCULAR ISSUED BY THE CBDT IN THE CASE OF COMMISSIONER OF CUSTOMS VS. IND IAN OIL CORPORATION LTD. 267 ITR 272. THEIR LORDSHIPS EXAMINED THE EARLIER DECISIONS OF T HE APEX COURT WITH REGARD TO BINDING OF THE CIRCULAR AND LAID DOWN THE FOLLOWING PRINCIPLES AT PAGE 277 OF THE REPORTS- THE PRINCIPALS LAID DOWN BY ALL THESE DECISIONS AR E- 1) ALTHOUGH A CIRCULAR IS NOT BINDING ON A COURT ON AN ASSESSEE, IT IS NOT OPEN TO THE REVENUE TO RAISE A CONTENTION THAT IS C ONTRARY TO A BINDING CIRCULAR BY THE BOARD. WHEN A CIRCULAR REMAINS IN O PERATION, THE REVENUE ITA NO.1629/KOL./2010 3 IS BOUND BY IT AND CANNOT BE ALLOWED TO PLEAD THAT IT IS NOT VALID NOR THAT IT IS CONTRARY TO THE TERMS OF THE STATUTE. 2) DESPITE THE DECISION OF THIS COURT, THE DEPARTME NT CANNOT BE PERMITTED TO TAKE A STAND CONTRARY TO THE INSTRUCTIONS ISSUED BY THE BOARD. (3) A SHOW CAUSE NOTICE AND DEMAND CONTRARY TO EXI STING CIRCULARS OF THE BOARD ARE AB INITIO VOID. (4) IT IS NOT OPEN TO THE REVENUE TO ADVANCE AN ARG UMENT OR FILE AN APPEAL CONTRARY TO THE CIRCULARS. 6. IN VIEW OF THE ABOVE AND CONSIDERING THE CBDTS CIRCULAR F. NO. 279/MISC.-64/05-ITJ DATED 24 TH OCTOBER, 2005 READ WITH INSTRUCTION NO. 2/2005 DAT ED 24 TH OCTOBER, 2005 AND INSTRUCTION NO. 5/2008 DATED 15.05.2008, WE HOLD TH AT THE APPEAL FILED BY THE DEPARTMENT IS CONTRARY TO THE SAID CIRCULARS/ INSTRUCTIONS OF THE CBDT. ACCORDINGLY, THIS IS NOT ADMITTED AND IS BEING DISMISSED IN LIMINE. 7. IN THE RESULT, THE APPEAL FILED BY THE DEPARTMEN T IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 11.04. 2011. SD/- SD/- [B.K. HALDAR/ ( . . )] [ B.R. MITTAL / . . ] ACCOUNTANT MEMBER/ JUDICIAL MEMBER/ DATED : 11/ 04 / 2011 COPY OF THE ORDER FORWARDED TO: 1. SMT. NILIMA SINGH, FLAT 2C, 96, GARDEN REACH ROAD, KOLKATA-700023. 2 ITO, WARD-30(4), KOLKATA, 2, GARIAHAT ROAD (SOUTH), KOLKATA-68 3. CIT(A)- ,KOLKATA 4. CIT, KOLKATA- 5. DR, KOLKATA BENCHES, KOLKATA (TRUE COPY) BY ORDER ASSISTANT REGISTRAR, I.T.A.T., KOLKATA LAHA, SR. P.S.