The Dy. CIT., Circle-1(2), Baroda V. M/s. Plastichemix Industries, Baroda

ITA 223/AHD/2017

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 0897 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 7 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-08-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2012-2013
• Appeal Filed On: 27-01-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: L P JAIN
• Assessee Lawyers: S N SOPARKAR
• Keywords: Tax effect

Judgement Text

ITA NO. 223/AHD/ 2017 DCIT VS. PLASTICHEMIX INDUSTRIES ASSESSMENT YEAR : 2012-13 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL, AHMEDABAD BENCH C, AHMEDABAD [CORAM: JUSTICE P P BHATT, PRESIDENT, AND PRAMOD KU MAR, VICE PRESIDENT] ITA NO. 223/AHD/2017 ASSESSMENT YEAR: 2012-13 DY. COMMISSIONER OF INCOME-TAX CIRCLE 1(2), BARODA .....APPELLANT VS PLASTICHEMIX INDUSTRIES ..........RESPON DENT 6 TH FLOOR, KIRTI TOWER, TILAK ROAD, SAYAJIGANJ, BARODA 390005 [PAN : AABFP 8519 L] APPEARANCES BY L P JAIN, FOR THE APPELLANT SN SOPARKAR AND PARIN SHAH, FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING : AUGUST 27, 2019 DATE OF PRONOUNCEMENT : AUGUST 27, 2019 O R D E R PER BENCH : 1. BY WAY OF THIS APPEAL, THE ASSESSING OFFICER HAS CHALLENGED CORRECTNESS OF THE ORDER DATED 12 TH AUGUST 2016, PASSED BY THE LEARNED CIT(A)-4, VADOD ARA FOR THE ASSESSMENT YEAR 2012-13. 2. GRIEVANCES RAISED BY THE ASSESSING OFFICER ARE A S FOLLOWS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE AND IN LAW, THE LD. CIT (APPEALS) ERRED IN DELETING THE ADDITION OF RS.65,6 3,544/- ON ACCOUNT OF UNDERSTATEMENT OF CLOSING STOCK SIMPLY ACCEPTING TH E SUBMISSIONS OF THE ASSESSEE AND WITHOUT CONSIDERING THE FACTS THAT THE ASSESSEE SUPPRESSED THE VALUE OF CLOSING STOCK AS BROUGHT ON RECORD BY THE ASSESSING OFFICER. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND I N LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.65,63,544/- BY CONSIDERING THE CONTENTION OF THE ASSESSEE THAT VALUATION OF CLOSING STOCK IS TO BE DONE AS WORKED OUT BY THE ASSESSEE AND IGNORING THE FINDINGS BROUGHT ON R ECORD BY THE ASSESSING ITA NO. 223/AHD/ 2017 DCIT VS. PLASTICHEMIX INDUSTRIES ASSESSMENT YEAR : 2012-13 PAGE 2 OF 3 OFFICER THAT THERE WAS ANOMALY IN SHOWING CLOSING S TOCK QUANTITY AS WELL AS THE VALUE ADOPTED BY THE ASSESSEE IS VERY LESS IN C OMPARISON TO THE AVERAGE COST OF OPENING STOCK AND AVERAGE COST OF PURCHASES . 3. WHEN THIS APPEAL WAS CALLED OUT FOR HEARING, LEA RNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE PRESENT APPEAL OF THE REVENUE NE EDS TO BE DISMISSED ON ACCOUNT OF LOW TAX EFFECT IN VIEW OF THE RECENT CBDT CIRCULAR NO. 17 OF 2019 DATED 08.08.2019 WHEREBY THE MONETARY LIMITS FOR FILING THE APPEAL B Y THE REVENUE BEFORE THE TRIBUNAL WAS ENHANCED FROM RS.20 LAKHS TO RS.50 LAKHS. THIS INSTRUCTION IS APPLICABLE TO THE PENDING CASES ALSO. THEREFORE, THE PRESENT APPEAL O F THE REVENUE IS LIABLE TO BE DISMISSED AS NON-MAINTAINABLE AS HELD BY THIS TRIBU NAL IN THE CASE OF ITO VS. DINESH MADHAVLAL PATEL IN ITA NO.1398/AHD/2004 FOR AY 1998-99 VIDE A CONSOLIDATED ORDER DATED 14.08.2019. 4. THE LEARNED DEPARTMENTAL REPRESENTATIVE FAIRLY ADMITTED THAT THE TAX EFFECT INVOLVED IN THIS APPEAL IS LESS THAN THE LIMIT PRES CRIBED BY THE AFORESAID CBDT CIRCULAR. 5. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF APPLIC ABLE LEGAL POSITION. AS LEARNED COUNSEL RIGHTLY CONTENDS, THIS APPEAL OF THE REVENU E IS NO LONGER MAINTAINABLE IN VIEW OF THE RECENT CBDT CIRCULAR NO. 17 OF 2019 DAT ED 08.08.2019. THE MANDATORY LIMIT FOR CASES IN WHICH REVENUE CAN CHALLENGE THE RELIEF GRANTED BY THE CIT(A) NOW STANDS ENHANCED TO RS.50 LAKHS. THIS CONCESSION GR ANTED BY THE CENTRAL BOARD OF DIRECT TAXES (CBDT) IS RETROSPECTIVE IN EFFECT INAS MUCH AS IT APPLIES TO ALL PENDING APPEALS AS WELL. IN VIEW OF THE ABOVE POSITION, TH E APPEAL OF THE REVENUE IS NO LONGER MAINTAINABLE AND MUST BE DISMISSED AS SUCH. 6. IT IS, HOWEVER, MADE CLEAR THAT ON RE-VERIFICATI ON AT THE END OF THE ASSESSING OFFICER IT COMES OUT THAT THE TAX EFFECT OF MORE TH AN RS.50 LAKHS IS BEING INVOLVED IN THE APPEAL OR THE APPEAL FALLS WITHIN THE EXEMPTION CLAUSE OF THE CIRCULAR, THEN THE REVENUE WILL BE AT LIBERTY TO FILE MISCELLANEOUS AP PLICATION TO RECALL THE TRIBUNAL ORDER. THE APPLICATION SHOULD BE FILED WITHIN TIME LIMIT PRESCRIBED IN THE ACT. 7. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D DUE TO LOW TAX EFFECT. PRONOUNCED IN THE OPEN COURT TODAY ON THE 27 TH AUGUST, 2019. SD/- SD/- JUSTICE P P BHATT PRAMOD KUMAR (PRESIDENT) (VICE PRESIDENT) AHMEDABAD, DATED THE 27 TH DAY OF AUGUST, 2019 ITA NO. 223/AHD/ 2017 DCIT VS. PLASTICHEMIX INDUSTRIES ASSESSMENT YEAR : 2012-13 PAGE 3 OF 3 COPIES TO: (1) THE APPELLANT (2) THE RESPOND ENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCHES, AHMEDABAD 1. DATE OF DICTATION: ...27.08.2019.. 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE T HE DICTATING MEMBER: .... 27.08.2019..... 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR . P.S./P.S.: .27.08.2019........ 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE TH E DICTATING MEMBER FOR PRONOUNCEMENT: 27.08.2019 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK : ..27.08.2019.... 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK : . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER : . 8. DATE OF DESPATCH OF THE ORDER: ......