Addll. CIT, Haridwar V. M/s Haridwar Steelts Pvt. Ltd, Haridwar

ITA 1788/DEL/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3757 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 1 month(s) 17 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: I
• Assessment Year: 2006-2007
• Appeal Filed On: 19-04-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: BANITA DEVI
• Assessee Lawyers: SAILESH GUPTA
• Keywords: Tax effect
• Section: 260A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH I: NEW DELHI BEFORE SMT. DIVA SINGH, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER I.T. A. NO.1788/DEL/2010 ASSESSMENT YEAR : 2006-07 ASSISTANT COMMISSIONER OF INCOME-TAX, M/S. HARIDWA R STEELS (P) LTD., TAX CIRCLE, HARDWAR. VS. C-9. D-2, INDUSTRIAL A REA, BAHADRABAD, HARDWAR. PAN: AAABCH1283N (APPELLANT) (RES PONDENT) APPELLANT BY: MS. BANITA DEVI, SR. DR. RESPONDENT BY: SHRI SAILESH GUPTA, CA. O R D E R PER DIVA SINGH, JUDICIAL MEMBER: THIS IS AN APPEAL FILED BY THE DEPARTMENT AGAINST T HE ORDER DATED 31.12.2009 OF THE COMMISSIONER OF INCOME-TAX (APPEALS)-I, DEHRADUN, P ERTAINING TO THE ASSESSMENT YEAR 2006-07, WHEREIN THE SOLE ISSUE AGITATED BY THE REV ENUE IS AS UNDER:- THE LEARNED CIT(A) HAS ERRED IN LAW AND ON FACTS I N ADMITTING THE FRESH EVIDENCE IN THE FORM OF BILLS FOR PURCHASE OF PLANT AND MACHINERY DURING THE APPELLATE PROCEEDINGS IN THE CONTRAVENTION OF S UB RULE (1) OF RULE 46A OF THE I.T. RULES, 1962, WITHOUT PROVIDING THE OPPO RTUNITY OF BEING HEARD TO THE AO. 2 2. AT THE TIME OF HEARING, IT WAS SUBMITTED BY THE LEARNED AR FOR THE ASSESSEE THAT THE APPEAL FILED BY THE DEPARTMENT IS NON-MAINTAINA BLE ON ACCOUNT OF TAX EFFECT INVOLVED. IT WAS SUBMITTED THAT THE ASSESSEES TOTAL INCOME I S RS.3,42,573/- AND THE TAX EFFECT IS ABOUT RS.1,29,000/- AND ODD WHICH IS BELOW RS.3,00, 000/-. ACCORDINGLY, IN TERMS OF THE INSTRUCTION NO.3/2011 OF 9 TH FEBRUARY, 2011 ISSUED BY THE CENTRAL BOARD OF DIRE CT TAXES (CBDT) WHEREIN THE MONETARY LIMIT FOR FILING THE AP PEAL IN THE INCOME-TAX MATTERS BEFORE THE TRIBUNAL HAS BEEN FIXED AT RS.3,00,000/-, THE D EPARTMENTAL APPEAL DESERVES TO BE DISMISSED. IN SUPPORT OF HIS CLAIM RELIANCE WAS PL ACED ON VARIOUS ORDERS OF THE CO- ORDINATE BENCH TO AGITATE THAT THE DEPARTMENTAL APP EAL DESERVES TO BE DISMISSED. COPIES OF THE FOLLOWING ORDERS WERE PLACED BEFORE THE BENC H NAMELY (1) ORDER OF ITAT, MUMBAI BENCH `A MUMBAI IN THE C ASE OF ITO VS. SHRI ASHOK G. DHANDHARIAI IN ITA NO.2460/MUM./2010, DATED 28 TH FEBRUARY, 2011, FOR THE ASSESSMENT YEAR 2005-06; & (2) ORDER OF ITAT, DELHI BENCH `F NEW DELHI IN THE CASE OF ITO VS. M/S. PRS SECURITIES PVT. LTD. IN ITA NO.4447/2010, DATED 25. 03.2011 FOR THE ASSESSMENT YEAR 2001-02. (3) JUDGMENT OF HIGH COURT OF DELHI IN THE CASE OF CIT VS. DELHI RACE CLUB LTD. IN ITA NO.128/2008, DATED 3 RD MARCH, 2011.. 3. THE LEARNED DR IN REGARD TO THE TAX EFFECT INVOL VED STATED THAT THE SAME IS BELOW RS.3 LAKHS. 4. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL AVAILABLE ON RECORD. ON CAREFUL CONSIDERATION OF THE SAME, WE ARE OF THE VI EW THAT THE DEPARTMENTAL APPEAL DESERVES TO BE DISMISSED. IT IS SEEN THAT THE JURI SDICTIONAL HIGH COURT IN THE CASE OF CIT VS. DELHI RACE CLUB LTD. (SUPRA) HAS HELD AS UNDER: - THE TAX EFFECT INVOLVED IN THE PRESENT APPEAL IS R S.4,65,860/-. AS PER RECENT GUIDELINES OF THE CBDT, APPEAL IN THOSE CASE S WHERE THE TAX EFFECT IS LESS THAN 10 LACS, ARE NOT BE ENTERTAINED. 3 THIS COURT IN THE CASE OF COMMISSIONER OF INCOME-TA X-III V. M/S. P.S. JAIN AND CO. BEING NO.179/1991 DECIDED ON 2 ND AUGUST, 2010 HAS TAKEN A VIEW THAT SUCH CIRCULAR WOULD ALSO APPLY TO PENDING CASE S. 4.1 IN THE FACTS OF THE PRESENT CASE ADMITTEDLY THE TAX PAYABLE IN RESPECT OF GROUNDS OF APPEAL BY THE DEPARTMENT IS LESS THAN RS.3 LAKHS AN D AS PER REVISED INSTRUCTION OF THE CBDT NO.3 DATED 9.2.2011 WHEREIN THE CBDT HAS REVIS ED THE FILING LIMITS FOR APPEAL FILED BEFORE THE TRIBUNAL, HIGH COURT AND SUPREME C OURT AS UNDER:- BEFORE THE INCOME TAX APPELLATE TRIBUNAL : RS.3 LA KHS, APPEALS U/S 260A OF THE IT ACT BEFORE THE HONBLE HIGH COURT : RS.10 LAKHS AND BEFORE THE HONBLE SUPREME COURT : RS.25 LAKHS 4.2 SINCE IN THE PRESENT CASE THE ABOVE REVISED INS TRUCTION IS FULLY APPLICABLE IN VIEW OF THE JUDGMENT OF THE HONBLE DELHI HIGH COURT (SU PRA), HENCE IN OUR OPINION THE REVENUES APPEAL IS NOT MAINTAINABLE IN VIEW OF THE SAID CIRCULAR OF THE CBDT. REFERENCE MAY ALSO BE MADE TO THE DECISION OF HONB LE MADHYA PRADESH HIGH COURT IN THE CASE OF CIT VS. ASHOK KUMAR MANIBHAI PATEL & CO . (2009) 317 ITR 386 (MP). 4.3 WE FURTHER FIND THAT IT IS A SETTLED LAW THAT T HE CIRCULARS ISSUED BY CBDT ARE BINDING ON THE REVENUE. THIS POSITION WAS CONFIRME D BY THE APEX COURT IN THE CASE OF COMMISSIONER OF CUSTOMS VS. INDIAN OIL CORPORATION LTD. REPORTED IN 267 ITR 272 WHEREIN THEIR LORDSHIPS EXAMINED THE EARLIER DECISI ONS OF THE APEX COURT WITH REGARD TO BINDING NATURE OF THE CIRCULAR AND LAID DOWN THAT W HEN A CIRCULAR ISSUED BY THE BOARD REMAINS IN OPERATION THEN THE REVENUE IS BOUND BY I T AND CANNOT BE ALLOWED TO PLEAD THAT IT IS NOT VALID OR THAT IT IS CONTRARY TO THE TERMS OF THE STATUTE. THE APPEAL UNDER CONSIDERATION HAS CERTAINLY BEEN FILED CONTRARY TO THE CIRCULAR ISSUED BY THE CBDT INSTRUCTION NO.3 DATED 9.2.2011. 4 4.4 IN VIEW OF THE ABOVE, WE HOLD THAT THE APPEAL F ILED BY THE DEPARTMENT AGAINST THE IMPUGNED ORDER OF THE LD. CIT(A), IS CONTRARY TO TH E POLICY DECISION OF THE DEPARTMENT AND AS SUCH THE APPEAL FILED BY THE DEPARTMENT IS D ISMISSED IN LIMINE . 5. IN THE RESULT, APPEAL FILED BY THE REVENUE IS DI SMISSED. 6. THIS DECISION WAS PRONOUNCED IN THE OPEN COURT O N THE DATE OF HEARING ITSELF I.E. ON 6 TH JUNE, 2011. SD/- SD/- (B.C. MEENA) (DIVA SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBE R DATED: 6 TH JUNE, 2011. COPY OF THE ORDER FORWARDED TO:- 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR BY ORDER *MG DEPUTY REGISTRAR, ITAT.