D.C.I.T., Circle-6(1), Kolkata, Kolkata V. M/s Guiness Properties & Holding Pvt. Ltd., Kolkata

ITA 2280/KOL/2016

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 1418 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-03-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2000-2001
• Appeal Filed On: 01-12-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S DASGUPTA
• Assessee Lawyers: MIRAJ D. SHAH
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENC H : KOLKATA [BEFORE HONBLE SRI N.V.VASUDEVAN, JM & SHRI WAS EEM AHMED, AM] I.T.A NO. 2280/KOL/20 16 ASSESSMENT YEAR : 2000-0 1 D.C.I.T., CIRCLE-6(1) -VS.- M/S GUINESS P ROPERTIES & KOLKATA HOLDINGS PVT. LTD., KOLKATA [PAN : AAACG 9843 L] (APPELLANT) (RESPONDENT) FOR THE APPELLANT : SHRI S.DASGUPTA, ADDL. CI T, SR.DR FOR THE RESPONDENT : SHRI MIRAJ D.SHAH, AR DATE OF HEARING : 15.02.2018. DATE OF PRONOUNCEMENT : 01.03.2018. ORDER PER N.V.VASUDEVAN, JM THIS IS AN APPEAL BY THE REVENUE AGAINST THE ORDER DATED 21.09.2016 OF CIT(A)- 8, KOLKATA RELATING TO A.Y.2000-01. 2. RECENTLY THE CBDT HAS ISSUED CIRCULAR NO. 2 1/2015, DATED 10TH DECEMBER, 2015, WHEREBY THE MONETARY LIMITS FOR FILING OF APPEALS BY THE DEPARTMENT BEFORE INCOME TAX APPELLATE TRIBUNAL AND HIGH COURTS AND SLP BEFORE SUPREME COURT HAVE BEEN INCREASED AS MEASURE FOR REDUCING LITIGATION. THE REVISED MONETARY LIMITS LAID DOWN IN PARA-3 OF THIS CIRCULAR AND THE MANNER OF COMPUTING TAX EFFECT AS LAID DOWN IN PARA-4 OF THIS CIRCULAR ARE AS FOLLOWS: 3. HENCEFORTH, APPEALS/ SLPS SHALL NOT BE FILED I N CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY LIMITS GIVEN HEREUNDER: - SL. NO. APPEALS IN INCOME-TAX MATTERS MONETARY LIMIT (IN RS) 1. BEFORE APPELLATE TRIBUNAL 10,00,000/- 2. BEFORE HIGH COURT 20,00,000/- 3. BEFORE SUPREME COURT 25,00,000/- 2 ITA NO.2280/KOL/2016 M/S GUINESS PROPERTIES & HOLDINGS PVT. LTD. A.YR.2000-01 2 IT IS CLARIFIED THAT AN APPEAL SHOULD NOT BE FILED MERELY BECAUSE THE TAX EFFECT IN A CASE EXCEEDS THE MONETARY LIMITS PRESCRIBED ABOVE. FILIN G OF APPEAL IN SUCH CASES IS TO BE DECIDED ON MERITS OF THE CASE. 4. FOR THIS PURPOSE, 'TAX EFFECT' MEANS THE DIFFERE NCE BETWEEN THE TAX ON THE TOTAL INCOME ASSESSED AND THE TAX THAT WOULD HAVE BEEN CH ARGEABLE HAD SUCH TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME IN RESPECT OF THE ISSUES AGAINST WHICH APPEAL IS INTENDED TO BE FILED (HEREINAFTER REFERRED TO AS 'D ISPUTED ISSUES'). HOWEVER THE TAX WILL NOT INCLUDE ANY INTEREST THEREON, EXCEPT WHERE CHAR GEABILITY OF INTEREST ITSELF IS IN DISPUTE. IN CASE THE CHARGEABILITY OF INTEREST IS T HE ISSUE UNDER DISPUTE, THE AMOUNT OF INTEREST SHALL BE THE TAX EFFECT. IN CASES WHERE RE TURNED LOSS IS REDUCED OR ASSESSED AS INCOME, THE TAX EFFECT WOULD INCLUDE NOTIONAL TAX O N 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. IN PARA-10 OF THE SAID CIRCULAR IT HAS FURTHER BEEN CLARIFIED THAT THE REVISED MONETARY LIMITS WILL APPLY RETROSPECTIVELY. THE RE LEVANT PARA-10 OF THE CIRCULAR READS THUS: 10. THIS INSTRUCTION WILL APPLY RETROSPECTIVELY TO PENDING APPEALS AND APPEALS TO BE FILED HENCEFORTH IN HIGH COURTS/ TRIBUNALS. PENDING APPEALS BELOW THE SPECIFIED TAX LIMITS IN PARA 3 ABOVE MAY BE WITHDRAWN/ NOT PRESSE D. APPEALS BEFORE THE SUPREME COURT WILL BE GOVERNED BY THE INSTRUCTIONS ON THIS SUBJECT, OPERATIVE AT THE TIME WHEN SUCH APPEAL WAS FILED. 4. IN THE PRESENT CASE, THE TAX EFFECT IN THIS AP PEAL BY THE REVENUE IS LESS THAN RS.10,00,000/-. THOUGH THIS APPEAL HAD BEEN FILED BY THE REVENUE ON 01.12.2016 AND WAS WITHIN THE MONETARY LIMIT IN THE FORM OF TAX EF FECT FOR FILING APPEALS BEFORE TRIBUNAL, IN VIEW OF PARA-10 OF THE CIRCULAR OF CBD T, EVEN SUCH APPEALS WILL BE GOVERNED BY THE NEW MONETARY LIMITS LAID DOWN IN TH E CBDT CIRCULAR NO.21/2015 REFERRED TO ABOVE. 5. 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 T HE CASE OF COMMISSIONER OF CUSTOMS VS INDIAN OIL CORPORATION LTD. REPORTED IN 267 ITR 272 WHEREIN THEIR LORDSHIPS EXAMINED THE EARLIER DECISIONS OF THE APE X COURT WITH REGARD TO BINDING NATURE OF THE CIRCULAR AND LAID DOWN THAT WHEN A CI RCULAR ISSUED BY THE BOARD REMAINS IN OPERATION THEN THE REVENUE IS BOUND BY IT AND CANNO T BE ALLOWED TO PLEAD THAT IT IS NOT 3 ITA NO.2280/KOL/2016 M/S GUINESS PROPERTIES & HOLDINGS PVT. LTD. A.YR.2000-01 3 VALID OR THAT IT IS CONTRARY TO THE TERMS OF THE ST ATUTE. THE APPEAL UNDER CONSIDERATION HAS CERTAINLY BEEN FILED CONTRARY TO THE CIRCULAR ISSUE D BY THE CBDT CIRCULAR NO.21 DATED 10.12.2015. 6.1. IN THE EVENT THE REVENUE FINDS AT A LATER POIN T OF TIME THAT THE TAX EFFECT IN THE APPEAL IS MORE THAN RS.10 LAKHS OR DESPITE LOW TAX EFFECT THE APPEAL OF THE REVENUE IS MAINTAINABLE, THE REVENUE IS AT LIBERTY TO MOVE TH IS TRIBUNAL FOR RECALL OF THIS ORDER. 7. IN VIEW OF THE ABOVE, WE HOLD THAT THE APPEAL FI LED 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 . 8. IN THE RESULT, THE APPEAL BY THE REVENUE IS DI SMISSED. ORDER PRONOUNCED IN THE COURT ON 01.03.2018. SD/- SD/- [WASEEM AHMED] [ N.V.VASUDEVAN ] ACCOUNTANT MEMBER JUDICIAL ME MBER DATED : 01.03.2018. [RG SR.PS] COPY OF THE ORDER FORWARDED TO: 1. M/S GUINESS PROPERTIES & HOLDINGS PVT. LTD., 10, CANNING STREET, KOLKATA-700001. 2. D.C.I.T., CIRCLE-6 (1), KOLKATA. 3. CIT(A)-8, KOLKATA 4. C.I.T-2, KOLKATA . 5. CIT(DR), KOLKATA BENCHES, KOLKATA. TRUE COPY BY ORDER SENIOR PRIVATE SECR ETARY HEAD OF OFFICE/ D.D.O., ITAT KOLKATA BENCHES 4 ITA NO.2280/KOL/2016 M/S GUINESS PROPERTIES & HOLDINGS PVT. LTD. A.YR.2000-01 4