ITO, Ward - 36(3), Kolkata, Kolkata V. M/s. Singhal Motors, Kolkata

ITA 1908/KOL/2010

• Counselvise Citation: [2012] 140 COUNSELVISE.COM (IT) 59592 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 3 month(s) 25 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2012
• Appeal Filed By: Department
• Bench Allotted: C
• Assessment Year: 2005-2006
• Appeal Filed On: 08-10-2010
• Court: TRIBUNAL
• Department Lawyers: A K PRAMANIK
• Assessee Lawyers: A BANSAL
• Keywords: Bogus purchase; Tax effect
• Section: 260A

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL, BEN CH C, KOLKATA () BEFORE , , , , , SHRI MAHAVIR SINGH, JUDICIAL MEMBER. /AND . .. . ! ! ! !. .. . , '# SHRI C.D.RAO, ACCOUNTANT MEMBER $%& $%& $%& $%& ' ' ' ' / ITA NO . 1908/KOL/2010 () *+/ ASSESSMENT YEAR : 2005-06 (-. / APPELLANT ) I.T.O., WARD-36(3), KOLKATA. - ( - - VERSUS - . (01-./ RESPONDENT ) M/S.SINGHAL MOTORS, KOLKATA (PAN: AAKFS 8866 K) 2 %& 2 %& 2 %& 2 %& /C.O. NO.185/KOL/2010 ' ' ' ' / A/O ITA NO.1908/KOL/2010 () *+/ ASSESSMENT YEAR : 2005-06 (-. / APPELLANT ) M/S.SINGHAL MOTORS, KOLKATA (PAN: AAKFS 8866 K) - ( - - VERSUS - . (01-./ RESPONDENT ) I.T.O., WARD-36(3), KOLKATA. -. 3 4 '/ FOR THE DEPARTMENT: SHRI A.K.PRAMANIK 01-. 3 4 '/ FOR THE ASSESSEE : SHRI A.BANSAL 5(6 3 !# /DATE OF HEARING : 02.02.2012. 7* 3 !# /DATE OF PRONOUNCEMENT : 02.02.2012. '8 / ORDER ( (( ( . .. . ! ! ! !. .. . ) )) ), , , , '# PER SHRI C.D.RAO, AM THE ABOVE TWO APPEALS ONE FILED BY THE REVENUE AND THE CROSS OBJECTION FILED BY THE ASSESSEE ARE AGAINST ORDERS DATED 27.07.201 0 OF THE CIT(A)-XX, KOLKATA PERTAINING TO A.YR. 2005-06. 2 2. IN THIS APPEAL THE REVENUE HAS TAKEN THE FOLLOWI NG GROUND :- 1. THE LD. CIT(A)-XX, KOLKATA HAS ERRED IN DELETIN G THE ADDITION OF RS.7,54,806/- MADE ON ACCOUNT OF BOGUS PURCHASE WIT HOUT PROPER APPRECIATION OF FACTS. 2. THERE IS A DELAY OF 35 DAYS IN FILING OF THE CROSS OBJECTION BY THE ASSESSEE FOR WHICH THE ASSESSEE HAS FILED A CONDONATION PETITION EXPLAINING THE REASONS FOR SUCH DELAY. AFTER CONSIDERING THE SUBMISSIONS BY THE ASS ESSEE THE DELAY IS CONDONED. 3. AT THE TIME OF HEARING WHEN THE BENCH ASKED THE LD. DR APPEARING ON BEHALF OF REVENUE ABOUT THE TAX EFFECT IN THIS APPEAL, HE FAI RLY CONCEDED THAT THE TAX EFFECT IS BELOW RS.3 LAKHS. THEREFORE, WE CONSIDER FIT TO DIS MISS THE REVENUES APPEAL IN LIMINE. 4. AS REGARDING THE CROSS OBJECTION RAISED BY ASSES SEE AT THE TIME OF HEARING THE LD. COUNSEL APPEARING ON BEHALF OF ASSESSEE FAIRLY CONSENTED TO WITHDRAW THE CROSS OBJECTION IF THE DEPARTMENTAL APPEAL IS DISMISSED I N LIMINE. HOWEVER, HE CONTENDED THAT THE ISSUE RAISED IN CROSS OBJECTION CANNOT BE A PRECEDENT IN THE FUTURE YEARS. 5. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CAR EFUL PERUSAL OF MATERIAL AVAILABLE ON RECORD, THIS TRIBUNAL IS CONSISTENTLY FOLLOWING THE CBDT INSTRUCTION IN DISMISSING THE REVENUES APPEAL IN LIMINE BY FOLLOW ING BOARD CIRCULAR CBDT INSTRUCTION NO.3/2011(F.NO.279/MISE/142/2007-ITJ) D ATED 9.2.2011 WHEREIN IT HAS BEEN ENHANCED THE LIMITS FOR FILING OF APPEALS BEFO RE THE TRIBUNAL TO RS.3 LAKHS. THE REVENUES APPEAL IS LIABLE TO BE DISMISSED IN LIMIN E. IN VIEW OF THE LATEST ORDER OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS DELH I RACE CLUB IN ITA NO.128/2008 WHEREIN THE HONBLE HIGH COURT OPINED THAT THAT THE CIRCULAR WOULD ALSO APPLY TO THE PENDING CASES. THE HONBE HIGH COURT HAS HELD AS UN DER :- THE TAX EFFECT INVOLVED IN THE PRESENT APPEAL IS RS.4,65,860/-. AS PER RECENT GUIDELINES OF THE CBDT, APPEAL IN THOSE CASES WHERE THE TAX EFFECT IS LESS THAN 10 LACS, ARE NOT BE ENTERTAINED. 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 CASES. 3 5.1. ADMITTEDLY THE TAX PAYABLE IN RESPECT OF GROUN DS OF APPEAL BY THE DEPARTMENT IS LESS THAN RS.3 LAKHS AND AS PER REVISED INSTRUCT ION OF THE CBDT NO. 3 DATED 9.2.2011 WHEREIN THE CBDT HAS REVISED THE FILING LI MITS FILED BEFORE THE TRIBUNAL, HIGH COURT AND SUPREME COURT AS UNDER :- BEFORE THE INCOME TAX APPELLATE TRIBUNAL : RS. 3 L AKHS, 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 SINCE IN THE PRESENT CASE THE ABOVE REVISED INSTRUC TION IS WELL APPLICABLE IN VIEW OF THE HONBLE DELHI HIGH COURT (SUPRA) HENCE IN OUR OPINI ON THE REVENUES APPEAL IS NOT MAINTAINABLE IN VIEW OF THE SAID CIRCULAR OF THE CB DT. 5.2. WE FURTHER FIND THAT IT IS A SETTLED LAW THAT THE CIRCULARS ISSUED BY CBDT ARE BINDING ON THE REVENUE. THIS POSITION WAS CONFIRMED BY THE APEX COURT IN THE CASE OF COMMISSIONER OF CUSTOMS VS INDIAN OIL CORPORATIO N 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 THA T WHEN A CIRCULAR ISSUED BY THE BOARD REMAINS IN OPERATION THEN THE REVENUE IS BOUN D BY IT AND CANNOT BE ALLOWED TO PLEAD THAT IT IS NOT VALID OR THAT IT IS CONTRARY T O THE TERMS OF THE STATUTE. THE APPEAL UNDER CONSIDERATION HAS CERTAINLY BEEN FILED CONTRA RY TO THE CIRCULAR ISSUED BY THE CBDT INSTRUCTION NO.3 DATED 9.2.2011. 5.3. IN VIEW OF THE ABOVE, WE HOLD THAT THE APPEAL FILED BY THE DEPARTMENT, AGAINST THE IMPUGNED ORDER OF THE LD. CIT(A), IS CONTRARY T O THE POLICY DECISION OF THE DEPARTMENT AND AS SUCH THE APPEAL FILED BY THE DEPA RTMENT IS DISMISSED IN LIMINE . 5.4. SINCE WE HAVE DISMISSED THE REVENUES APPEAL I N LIMINE THE CROSS OBJECTION IS ALSO DISMISSED AS BEING WITHDRAWN. HOWEVER, THE ISS UE RAISED IN THE CROSS OBJECTION CANNOT BE A PRECEDENT FOR THE REVENUE IN FURTHER YE ARS. 4 6. IN THE RESULT BOTH THE REVENUES APPEAL AND CROS S OBJECTION OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 02.02.2012. SD/- SD/- , , , , MAHAVIR SINGH, JUDICIAL MEMBER . .. . ! ! ! !. .. . , ,, , '# '# '# '# , C.D.RAO, ACCOUNTANT MEMBER. ( (( (!# !# !# !#) )) ) DATE: 02.02.2012. '8 3 0% 9'%*:- COPY OF THE ORDER FORWARDED TO: 1. M/S.SINGHAL MOTORS, 1, BONEFIELD LANE, KOLKATA-7000 01. 2 THE I.T.O., WARD-36(3), KOLKATA. 3. THE CIT, 4. THE CIT(A)-XX, KOLKATA. 5. DR, KOLKATA BENCHES, KOLKATA 1% 0/ TRUE COPY, '8(5/ BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES R.G.(.P.S.)