DCIT,Central Circle-1(4), Kolkata, Kolkata V. M/s Mishra Brick Field Pvt. Ltd., Kolkata

ITA 228/KOL/2017

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 3097 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 6 month(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 27-08-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2013-2014
• Appeal Filed On: 07-02-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P K SRIHARI
• Assessee Lawyers: A K TIBREWAL
• Keywords: Tax effect

Judgement Text

I.T.A. NOS 219, 228 & 229/KOL/2017 ASSESSMENT YEAR: 2013- 2014 PAGE 1 OF 5 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA D BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER & SHRI S.S. VISWANETHRA RAVI, JUDICIAL MEMBER I.T.A. NO. 219/KOL/2017 ASSESSMENT YEAR: 2013-2014 DEPUTY COMMISSIONER OF INCOME TAX,................. ............................APPELLANT CENTRAL CIRCLE-1(4), KOLKATA, AAYAKAR BHAWAN POORVA, 110, SHANTI PALLY, KOLKATA-700 107 -VS.- BINOD KUMAR MISHRA & OTHERS (HUF),................. ...........................RESPONDENT 7, WATERLOO STREET, 2 ND FLOOR, ESPLANADE, KOLKATA-700 069 [PAN: AABHB 7999 C] & I.T.A. NO. 228/KOL/2017 ASSESSMENT YEAR: 2013-2014 DEPUTY COMMISSIONER OF INCOME TAX,................. ............................APPELLANT CENTRAL CIRCLE-1(4), KOLKATA, AAYAKAR BHAWAN POORVA, 110, SHANTI PALLY, KOLKATA-700 107 -VS.- M/S. MISHRA BRICKS FIELD PVT. LIMITED,............. ...............................RESPONDENT 7, WATERLOO STREET, 2 ND FLOOR, ESPLANADE, KOLKATA-700 069 [PAN: AABCM 6831 H] & I.T.A. NO. 229/KOL/2017 ASSESSMENT YEAR: 2013-2014 DEPUTY COMMISSIONER OF INCOME TAX,................. ............................APPELLANT CENTRAL CIRCLE-1(4), KOLKATA, AAYAKAR BHAWAN POORVA, 110, SHANTI PALLY, KOLKATA-700 107 -VS.- M/S. LIKE WISH VINIMAY PVT. LIMITED,............... ............................RESPONDENT 3 RD FLOOR, ROOM NO. 14, 29A, RABINDRA SARANI, I.T.A. NOS 219, 228 & 229/KOL/2017 ASSESSMENT YEAR: 2013- 2014 PAGE 2 OF 5 KOLKATA-700 073 [PAN: AAACL 9178 R] APPEARANCES BY: SHRI P.K. SRIHARI, CIT, D.R. , FOR THE DEPARTMENT SHRI A.K. TIBREWAL, FCA & SHRI AMIT AGARWAL, ADVOCA TE, FOR THE ASSESSEES DATE OF CONCLUDING THE HEARING : AUGUST 27, 2018 DATE OF PRONOUNCING THE ORDER : AUGUST 27, 2018 O R D E R PER SHRI P.M. JAGTAP, A.M. : THESE THREE APPEALS PREFERRED BY THE REVENUE IN CA SE OF THREE ASSESSEES ARE DIRECTED AGAINST THE FOLLOWING ORDERS OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-20, KOLKATA:- (I) I.T.A. NO. 219/KOL/2017 BINOD KUMAR MISHRA & OTHERS (HUF)- ORDER DATED 8 TH NOVEMBER 2016; (II) I.T.A. NO. 228/KOL/2017 M/S. MISHRA BRICKS FIELD PVT. LIMITED- ORDER DATED 7 TH NOVEMBER, 2016; (III) I.T.A. NO. 229/KOL/2017 M/S. LIKE WISH VINIMAY PVT. LIMITED- ORDER DATED 7 TH NOVEMBER, 2016. 2. AS POINTED OUT BY THE LD. COUNSEL FOR THE ASSESS EES, AT THE OUTSET, THE TAX EFFECT INVOLVED IN EACH OF THESE THREE APPEALS INDIVIDUALL Y IS LESS THAN THE REVISED MONETARY LIMIT OF RS.20 LACS FIXED BY CBDT FOR FILING THE RE VENUES APPEALS BEFORE THE TRIBUNAL VIDE LATEST CIRCULAR NO. 3/2018 DATED 11.07.2018. I T WILL BE PERTINENT TO REPRODUCE THE RELEVANT PORTION OF THE SAID CIRCULAR NO. 3/2018 DA TED 11.07.2018 AS UNDER:- 3 . HENCEFORTH, APPEALS/ SLPS SHALL NOT BE FILED IN CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY LIMITS GIVEN HEREUNDER: SL. NO. APPEALS/SLPS IN INCOME-TAX MATTERS MONETARY LIMIT (IN RS) 1. BEFORE APPELLATE TRIBUNAL 20,00,000/- 2. BEFORE HIGH COURT 50,00,000/- 3. BEFORE SUPREME COURT 1,00,00,000/- I.T.A. NOS 219, 228 & 229/KOL/2017 ASSESSMENT YEAR: 2013- 2014 PAGE 3 OF 5 IT IS CLARIFIED THAT AN APPEAL SHOULD NOT BE FILED ME RELY BECAUSE THE TAX EFFECT IN A CASE EXCEEDS THE MONETARY LIMITS PRESCRIBED ABOVE. F ILING OF APPEAL IN SUCH CASES IS TO BE DECIDED ON MERITS OF THE CASE. 4. FOR THIS PURPOSE, 'TAX EFFECT' MEANS THE DIFFERENC E BETWEEN THE TAX ON THE TOTAL INCOME ASSESSED AND THE TAX THAT WOULD HAVE BEEN CHARGE ABLE HAD SUCH TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME IN RESPE CT OF THE ISSUES AGAINST WHICH APPEAL IS INTENDED TO BE FILED (HEREINAFTER REFE RRED TO AS 'DISPUTED ISSUES). FURTHER, 'TAX EFFECT' SHALL BE TAX INCLUDING APPLICAB LE SURCHARGE AND CESS. HOWEVER, THE TAX WILL NOT INCLUDE ANY INTEREST THEREON, EXCEPT WHERE CHARGEABILITY OF INTEREST ITSELF IS IN DISPUTE. IN CASE THE CHARGEABILITY OF IN TEREST IS THE ISSUE UNDER DISPUTE, THE AMOUNT OF INTEREST SHALL BE THE TAX EFFECT. IN CASES WHERE RETURNED LOSS IS REDUCED OR ASSESSED AS INCOME, THE TAX EFFECT WOULD INCLUDE NOT IONAL TAX ON DISPUTED ADDITIONS. IN CASE OF PENALTY ORDERS, THE TAX EFFECT WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE ORDER TO BE APPEALED AGAINST. 3. ON PERUSAL OF THE CIRCULAR NO. 3/2018 DATED 11.0 7.2018 AND THE MATERIALS AVAILABLE ON RECORD, WE DO NOT SEE THESE CASES FALL ING UNDER ANY OF THE EXCEPTIONS CONTEMPLATED IN THE SAID CIRCULAR PER SE . WE ALSO FIND THAT THIS CIRCULAR MAKES IT VERY CLEAR THAT THE REVISED MONETARY LIMITS SHALL APPLY RETROSPECTIVELY TO PENDING APPEALS AS WELL. H ONBLE APEX COURT IN COMMISSIONER OF CUSTOMS VS IND IAN OIL CORPORATION LTD REPORTED IN 267 ITR 272 (SC) HAS SETTLED THE LAW THAT CBDTS CIRCULARS ARE VERY MUCH BINDING ON REVENUE AUTHORITIES. WE THUS HOLD THAT A LL THESE REVENUES APPEALS DESERVE TO BE DISMISSED IN TERMS OF LOW TAX EFFECT. WE MAKE IT CLEAR THAT IT SHALL BE VERY MUCH OPEN FOR THE REVENUE TO SEEK NECESSARY RECTIFICATIO N IN CASE IT IS FOUND THAT ANY OF THESE APPEALS INVOLVE OPERATIONS OF EXCEPTION CLAUSES IN THE TAX EFFECT CIRCULAR AS PER LAW. 4. IN RESPECT OF THESE THREE APPEALS FILED BY THE R EVENUE, THE ASSESSEES HAVE FILED THEIR CROSS OBJECTIONS BEING C.O. NOS. 28/KOL/2017 (IN ITA NO. 219/KOL/2017), 33/KOL/2017 (IN ITA NO. 228/KOL/2017) & 92/KOL/2017 (IN ITA NO. 229/KOL/2017). THE LD. D.R. HAS CONTENDED THAT THES E THREE CROSS OBJECTIONS FILED BY THE ASSESSEES ARE LIABLE TO BE DISMISSED IN LIMINE AS A RESULT OF DISMISSAL OF THE CORRESPONDING APPEALS OF THE DEPARTMENT BECAUSE OF LOW TAX EFFECT. IN THIS REGARD, THE LD. COUNSEL FOR THE ASSESSEES HAS RELIED ON THE DEC ISION OF DELHI BENCH OF THIS TRIBUNAL IN THE CASE OF ACIT VS.- AJAY KALIA (2016) 66 TAXMAN N.COM 99, WHEREIN IT WAS HELD THAT WHERE THE CROSS OBJECTION FILED UNDER SECTION 253(4 ) IS ON AN ISSUE INDEPENDENT OF THE I.T.A. NOS 219, 228 & 229/KOL/2017 ASSESSMENT YEAR: 2013- 2014 PAGE 4 OF 5 APPEAL FILED BY THE REVENUE, THEN SUCH CROSS OBJECT ION CANNOT BE DISMISSED SIMPLY ON THE GROUND OF DISMISSAL OF THE APPEAL BY THE REVENU E INVOLVING LOW TAX EFFECT. HE HAS CONTENDED THAT PENALTY UNDER SECTION 271AAB(1)(A) W AS IMPOSED BY THE ASSESSING OFFICER ON THE TOTAL INCOME, WHICH INCLUDED PARTLY THE INCOME REPRESENTED BY CASH AND OTHER ASSETS FOUND OR SEIZED DURING THE COURSE OF S EARCH WHILE THE BALANCE INCOME REPRESENTED INCOME SUO MOTU DECLARED BY THE ASSESSEES, WHICH WAS NOT REPRESENT ED BY ANY ASSET FOUND OR SEIZED DURING THE COURSE OF SEAR CH. HE HAS SUBMITTED THAT WHEN THE SAID PENALTY IMPOSED BY THE ASSESSING OFFICER WAS C HALLENGED BY THE ASSESSEES IN THE FIRST APPEAL FILED BEFORE THE LD. CIT(APPEALS), THE LD. CIT(APPEALS) VIDE HIS IMPUGNED ORDERS HAS CONFIRMED THE PENALTY TO THE EXTENT IT W AS ON THE AMOUNT OF UNDISCLOSED INCOME REPRESENTED BY CASH AND OTHER ASSETS FOUND O R SEIZED DURING THE COURSE OF SEARCH WHILE THE PENALTY IMPOSED IN RESPECT OF THE BALANCE UNDISCLOSED INCOME, WHICH WAS SUO MOTU DECLARED BY THE ASSESSEES AND WHICH DID NOT REPRES ENT ANY ASSET FOUND OR SEIZED DURING THE COURSE OF SEARCH, WAS CANCELLED B Y HIM. HE HAS CONTENDED THAT THE ISSUE INVOLVED IN THE CROSS OBJECTIONS FILED BY THE ASSESSEES CHALLENGING THE ACTION OF THE LD. CIT(APPEALS) TO THE EXTENT OF CONFIRMATION OF PENALTY LEVIED BY THE ASSESSING OFFICER UNDER SECTION 271AAB(1)(A) THUS IS DIFFEREN T AND THE SAME CAN BE DECIDED INDEPENDENT OF THE CORRESPONDING APPEAL FILED BY TH E REVENUE. WE FIND MERIT IN THIS CONTENTION OF THE LD. COUNSEL FOR THE ASSESSEES AND KEEPING IN VIEW THE SUBMISSIONS MADE BY THE LD. COUNSEL FOR THE ASSESSEES AND RESPE CTFULLY FOLLOWING THE DECISION OF THE COORDINATE BENCH OF THIS TRIBUNAL AT DELHI IN THE C ASE OF ACIT VS.- AJAY KALIA (SUPRA), WE HOLD THAT ALL THE THREE CROSS OBJECTIONS FILED B Y THE ASSESSES, WHICH INVOLVE AN ISSUE, WHICH CAN BE DECIDED INDEPENDENT OF THE APPEALS FIL ED BY THE REVENUE, ARE MAINTAINABLE HAVING INDEPENDENT EXISTENCE. THE REGISTRY IS ACCOR DINGLY DIRECTED TO FIX THE SAID CROSS OBJECTIONS ALONG WITH OTHER GROUP CASES INVOLVING A SIMILAR ISSUE FOR HEARING AND DISPOSAL. 5. IN THE RESULT, ALL THE THREE APPEALS OF THE REVE NUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON AUGUST 27, 20 18. SD/- SD/- (S.S. VISWANETHRA RAVI) (P.M. JAGTAP) JUDICIAL MEMBER ACCOUNTANT MEMBER KOLKATA, THE 27 TH DAY OF AUGUST, 2018 I.T.A. NOS 219, 228 & 229/KOL/2017 ASSESSMENT YEAR: 2013- 2014 PAGE 5 OF 5 COPIES TO : (1) DEPUTY COMMISSIONER OF INCOME TAX, CENTRAL CIRCLE-1(4), KOLKATA, AAYAKAR BHAWAN POORVA, 110, SHANTI PALLY, KOLKATA-700 107 (2) BINOD KUMAR MISHRA & OTHERS (HUF), 7, WATERLOO STREET, 2 ND FLOOR, ESPLANADE, KOLKATA-700 069 (3) M/S. MISHRA BRICKS FIELD PVT. LIMITED, 7, WATERLOO STREET, 2 ND FLOOR, ESPLANADE, KOLKATA-700 069 (4) M/S. LIKE WISH VINIMAY PVT. LIMITED, 3 RD FLOOR, ROOM NO. 14, 29A, RABINDRA SARANI, KOLKATA-700 073 (5) COMMISSIONER OF INCOME TAX (APPEALS)-20, KOLK ATA, (6) COMMISSIONER OF INCOME TAX- , (7) THE DEPARTMENTAL REPRESENTATIVE (8) GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, HEAD OF OFFICE/D.D.O. INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.