The DCIT, Circle-1 (1), Rajkot V. M/s. Tirthak Paper Mill Pvt. Ltd., Morbi-363641

ITA 163/RJT/2022

AI Insights

The case involves an appeal by the Deputy Commissioner of Income Tax, Circle-1(1), Rajkot against M/s. Tirthak Paper Mill Pvt. Ltd. The appeal was directed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, which had deleted certain additions made by the Assessing Officer for the Assessment Year 2013-14. The additions pertained to alleged clandestine removal of goods and issues related to the creditworthiness and genuineness of transactions. The Revenue contended that the CIT(A) erred in deleting the additions without proper basis, despite admissions made by the company's director regarding clandestine activities. However, the appeal was dismissed at the outset due to the low tax effect involved, following the guidelines of the CBDT Circular aimed at reducing litigation.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 138274 (ITAT-RAJKOT)
• Duration Of Justice: 1 year(s) 3 month(s) 18 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-08-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 08-08-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 04-05-2022
• Laws Referred To: CBDT Circular No.17 of 2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect; Tax effect
• Section: 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL RAJKOT BENCH, RAJKOT (Conducted through E-Court at Ahmedabad) BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER & SHRI SIDDHARTHA NAUTIYAL, JUDICIAL MEMBER I .T .A . N o .1 6 3 /R j t /2 02 2 ( A s se ss m e nt Y e a r : 20 13- 14 ) De put y C o m mi s s io ne r o f In c o me Ta x , Cir c l e- 1( 1 ), Ra j ko t V s . M/ s . Ti r t ha k Pa pe r M i ll Pv t. L td ., Su rv e y No . 14 , Vi ll a ge L il ap u r , Po st Li la pu r , M or bi , G uj a r a t- 36 36 4 1 [P AN N o. A A C C T3 81 3 F ] (Appellant) .. (Respondent) Appellant by : Shri Abhimanyu Singh, Sr. D.R. Respondent by: Ms. Devina Patel, A.R. D a t e of H ea r i ng 09.08.2023 D a t e of P r o no u n ce me nt 23.08.2023 O R D E R PER SIDDHARTHA NAUTIYAL, JM: This appeal has been filed by the Revenue against the order passed by the Ld. Commissioner of Income Tax(Appeals), (in short “Ld. CIT(A)”), National Faceless Appeal Centre, (in short “NFAC”), in Order No. ITBA/NFAC/S/250/2021-22/1040636733(1) vide order dated 12.03.2022 passed for Assessment Year 2013-14. 2. The Revenue has taken the following grounds of appeals:- “(1) On facts and circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the addition of Rs.1,22,02,420/- holding that the department of Central Excise had itself dropped the proceedings. ITA No.163/Rjt/2022 DCIT vs. M/s. Tirthak Paper Mill Pvt. Ltd. Asst.Year –2013-14 - 2 - (2) The Ld. CIT(A) allowed the appeal merely on the fact that the CE & EX department had dropped the proceedings without bringing on records the basis on which the CE & EX department had dropped the Proceedings. (3) The Ld. CIT(A) failed to appreciate the facts that in his statement the director of the company had itself accepted that they had made clandestine removal of goods. (4) That the Ld. CIT(A) has erred in deleting the addition of Rs.24,00,000/-. The AO has made the addition because the assessee had failed to proof regarding creditworthiness and genuineness of transaction. (5) It is therefore prayed that the order of the Ld. CIT(A) be set aside and the order of the AO restored.” 3. At the time of hearing, it was submitted by the Ld. AR for the assessee that appeal filed by the Revenue is hit by recently issued CBDT Circular No.17 of 2019 dated 08/08/2019 revising the previous thresholds pertaining to tax effects. As per aforesaid Circular, all pending appeals filed by Revenue are liable to be dismissed as a measure for reducing litigation where the tax effect does not exceed the prescribed monetary limit which is now revised at Rs.50 Lakhs. In the instant case, the tax effect on the disputed issues raised by the Revenue is stated to be not exceeding Rs.50 lakhs and therefore appeal of the Revenue is required to be dismissed in limine. 4. The Learned DR for the Revenue fairly admitted the applicability of the CBDT Circular No. 17 of 2019. Accordingly, appeal of the Revenue is ITA No.163/Rjt/2022 DCIT vs. M/s. Tirthak Paper Mill Pvt. Ltd. Asst.Year –2013-14 - 3 - dismissed as not maintainable. However, it will be open to the Revenue to seek restoration of its appeal on showing inapplicability of the aforesaid CBDT Circular in any manner. 5. In the result, the appeal of the Revenue is dismissed. This Order pronounced in Open Court on 23/08/2023 Sd/- Sd/- (WASEEM AHMED) (SIDDHARTHA NAUTIYAL) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 23/08/2023 TANMAY, Sr. PS TRUE COPY आदेश क त ल प अ े षत/Copy of the Order forwarded to : 1. अपीलाथ / The Appellant 2. यथ / The Respondent. 3. संबं धत आयकर आय ु त / Concerned CIT 4. आयकर आय ु त(अपील) / The CIT(A)- 5. वभागीय त न ध, आयकर अपील!य अ धकरण, राजोकट / DR, ITAT, Rajkot 6. गाड' फाईल / Guard file. आदेशान ु सार/ BY ORDER, उप/सहायक पंजीकार Dy./Asstt.Registrar) आयकर अपील य अ धकरण, राजोकट / ITAT, Rajkot 1. Date of dictation 21.08.2023(in LTE format) 2. Date on which the typed draft is placed before the Dictating Member 21.08.2023 3. Other Member..................... 4. Date on which the approved draft comes to the Sr.P.S./P.S .08.2023 5. Date on which the fair order is placed before the Dictating Member for pronouncement .08.2023 6. Date on which the fair order comes back to the Sr.P.S./P.S 23 .08.2023 7. Date on which the file goes to the Bench Clerk 23 .08.2023 8. Date on which the file goes to the Head Clerk.......................................... 9. The date on which the file goes to the Assistant Registrar for signature on the order.......................... 10. Date of Despatch of the Order..........................................