ITO 25(3)2), MUMBAI V. VANDANA S. LOTLE, MUMBAI

ITA 2013/MUM/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 79481 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 4 month(s) 14 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 24-07-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 24-07-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 11-03-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NEERJA PRADHAN
• Keywords: Search and seizure; Question of law; Tax effect
• Section: 144

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL H BENCH, MUMBAI , , , BEFORE SHRI SANJAY ARORA , ACCOUNTANT MEMBER AND SHRI AMIT SHUKLA U , JUDICIAL MEM BER . / ITA NO. 2013 /MUM./ 2011 ( / ASSESSMENT YEAR : 20 0 7 08 ) INCOME TAX OFFICER WARD 25 ( 3 )( 2 ) C 11, ROOM NO.306 PRATYAKSHA KAR BHAVAN BANDRA KURLA COMPLEX, BANDRA (E) MUMBAI 400 051 .. / APPELLANT V/S SMT. VANDANA S. LOTLE ROOM NO.34, SHAFI MOHD. CHAWL GAONDEVI ROAD, POISAR KANDIVALI (E), MUMBAI 400 101 .... / RESPONDENT ./ PERMANENT ACCOUNT NUMBER ABZPL3261C / REV ENUE BY : MS. NE ERJA PRADHAN / ASSESSEE BY : NONE / DATE OF HEARING 2 4 . 0 7 .2014 / DATE OF ORDE R 24.07.2014 / ORDER , / PER AMIT SHUKLA , J.M. THE PRESENT APP EAL HA S BEEN PREFERRED BY THE REVENUE CHALLENGING THE IMPUGNED ORDER DATED 28 TH DECEMBER 2010 , PASSED BY THE LEARNED COMMISSIONER (APPEALS) X X XV , MUMBAI, FOR THE QUANTUM SMT. VANDANA S. LOTLE 2 OF ASSESSMENT PASSED UNDER SECTION 144 , OF THE INCOME TAX ACT, 1961 (FOR SHORT 'THE AC T' ) FOR THE ASSESSMENT YEAR 20 07 08. 2 . WHEN THE CASE WAS CALLED FOR HEARING, NEITHER THE ASSESSEE NOR ANY OF ITS AUTHORIZED REPRESENTATIVES APPEARED BEFORE US. HOWEVER, THE LEARNED DEPARTMENTAL REPRESENTATIVE , ON A QUERY RAIDED BY THE BENCH ABOUT LOW TAX E FFECT, SUBMITTED A LETTER DATED 22 ND JULY 2014, WRITTEN BY THE INCOME TAX OFFICER, WARD 25(3)(2), MUMBAI, STATING THAT THE TAX EFFECT IN THE APPEAL PREFERRED BY THE REVENUE IS BELOW ` 3 LAKHS. THE WORKING OF THE TAX EFFECT HAS BEEN GIVEN AS UNDER: A. MRS. VANDANA S. LOTLE (2007 08) ADDITION : I . DISALLOWANCE OF EXPENSES ` 9,40,755 II . DISALLOWANCE U/S 58 ` 1,63,000 TOTAL DISALLOWANCE ` 1 1,03,755 TAX EFFECT ` 2,88,750 ======= 3 . AFTER HEARING THE LEARNED DEPARTMENTAL REPRESENTATI VE, WE FIND THAT AS PER CBDT INSTRUCTION NO.3 OF 2011, DATED 9 TH FEBRUARY 2011, THE APPEAL BEFORE THE APPELLATE TRIBUNAL CAN BE FILED BY THE REVENUE, WHEN THE TAX EFFECT EXCEEDS THE MONITORY LIMIT OF ` 3,00,000. THIS APPEAL HAS BEEN FILED AFTER 9 TH FEBRUAR Y 2011. NOW, IN THE LATEST INSTRUCTION, THE CBDT HAS RAISED THE LIMIT OF TAX EFFECT FOR FILING OF APPEAL BEFORE THE TRIBUNAL AT ` 4 LAKHS. HOWEVER, THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT V/S MADHUKAR K. INAMDAR (HUF), [2009] 318 ITR 149 (BOM.) HA S HELD THAT SUCH CIRCULARS ARE APPLICABLE ON PENDING APPEALS ALSO. THE RELEVANT OBSERVATIONS ARE AS UNDER: THE CIRCULAR DATED MAY 15, 2008 IN GENERAL AND PARAGRAPH (5) THEREOF IN PARTICULAR LAY DOWN THAT EVEN IF THE SAME ISSUE, IN RESPECT OF THE SAME A SSESSEE, FOR OTHER ASSESSMENT YEARS IS SMT. VANDANA S. LOTLE 3 INVOLVED, THE DEPARTMENT SHOULD NOT FILE APPEAL, IF THE TAX EFFECT IS LESS THAN ` 4 LAKHS. IN OTHER WORDS, EVEN IF THE QUESTION OF LAW IS OF RECURRING NATURE, THE REVENUE IS NOT EXPECTED TO FILE APPEALS IN SUCH CASES, IF THE TAX IMPACT IS LESS THAN THE MONETARY LIMIT FIXED BY THE CENTRAL BOARD OF DIRECT TAXES. THE BOARD HAS ALSO ISSUED A CIRCULAR ON JUNE 5, 2007, DIRECTING THE DEPARTMENT TO EXAMINE ALL APPEALS PENDING BEFORE THE COURT ON A CASE TO CASE BASIS WITH FURTH ER DIRECTION TO WITHDRAW CASES WHEREIN THE CRITERIA OF MONETARY LIMITS AS PER THE PREVAILING INSTRUCTION ARE NOT SATISFIED, UNLESS THE QUESTION OF LAW INVOLVED OR RAISED IN APPEAL OR REFERRED TO THE HIGH COURT FOR OPINION IS OF A RECURRING NATURE REQUIRED TO BE SETTLED BY THE HIGHER COURT. THE CIRCULAR MAKES IT CLEAR THAT ON THE DATE OF ISSUANCE OF THE CIRCULAR, PREVAILING INSTRUCTIONS FIXING MONETARY LIMIT WILL HOLD GOOD EVEN FOR PENDING CASES. THE CIRCULAR DATED MAY 15, 2008 WOULD BE APPLICABLE TO PENDING CASES REQUIRING THE DEPARTMENT TO WITHDRAW CASES WHEREIN THE TAX EFFECT IS LESS THAN THE PRESCRIBED MONETARY LIMITS. THE CIRCULAR DATED MAY 15, 2008, WOULD BE APPLICABLE TO CASES PENDING BEFORE THE COURT EITHER FOR ADMISSION OR FOR FINAL DISPOSAL AND IT I S BINDING ON THE REVENUE. 4 . IN VIEW OF THE ADMITTED FACT THAT THE TAX EFFECT IS LESS THAN ` 3 LAKHS, THEREFORE, THE APPEAL OF THE DEPARTMENT IS DISMISSED AS NON MAINTAINABLE. 5 . 5. IN THE RESULT, REVENUES APPEA L IS DISMISSED. 24 TH JULY 2014 ORDER PRONOUNCED IN THE OPEN COURT O N 24 TH JULY 2014 SD/ - SANJAY ARORA ACCOUNTANT MEMBER SD/ - AMIT SHUKLA JUDICIAL MEMBER MUMBAI, DATED : 24 TH JULY 2014 SMT. VANDANA S. LOTLE 4 / COPY OF THE ORDER FORWARDED TO : ( 1 ) / THE ASSESSEE ; ( 2 ) / THE REVENUE; ( 3 ) ( ) / THE CIT(A ) ; ( 4 ) / THE CIT, MUMBAI CITY CONCERNED ; ( 5 ) , , / THE DR, ITAT, MUMBAI ; ( 6 ) / GUARD FILE . / TRUE COPY / BY ORDER . / PRADEEP J. CHOWDHURY / SR. PRIVATE SECRETARY / / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI SMT. VANDANA S. LOTLE 5 DATE INITIAL ORIGINAL DICTAT ION PAID IS ENCLOSED AT THE END OF FILE 1. DRAFT DICTATED ON 24.7.2014 SR.PS 2. DRAFT PLACED BEFORE AUTHOR 25.7.2014 SR.PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER 25.7.2014 JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER 25.7.2014 JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS 25.7.2014 SR.PS 6. DATE OF PRONOUNCEMENT 24.7.2014 SR.PS 7. FILE SENT TO THE BENCH CLERK 30.7.2014 SR.PS 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER , / / 19997 98 2000 01 / / / / / / / / / /