The DCIT, Circle-1(2), Baroda V. M/s. Liquid Control India (P) Ltd., Baroda

ITA 23/AHD/2010

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 9683 (ITAT-AHMEDABAD)
• Duration Of Justice: 6 year(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 29-01-2016
• Assessment Year: 2002-2003
• Appeal Filed On: 04-01-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SONIA KUMAR
• Keywords: Audit objection; Tax effect

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL D BENCH, AHMEDABAD - , , BEFORE SHRI KUL BHARAT, JUDICIAL MEMBER AND SHRI MANISH BORAD, ACCOUNTANT MEMBER ./ I.T.A. NO.23/AHD/2010 ( / ASSESSMENT YEAR : 2002-03) THE DCIT CIRCLE-1(2) BARODA / VS. LIQUID CONTROLS INDIA P LTD. 808, VCCI COMPLEX, GIDC MAKARPURA, BARDOA 390 007 $ ./ ./ PAN/GIR NO. : AAACL 3371 J ( $' / APPELLANT ) .. ( ()$' / RESPONDENT ) $' * / APPELLANT BY : MS. SONIA KUMAR, SR.DR ()$' + * / RESPONDENT BY : SHRI SANJAY R.SHAH, AR ,- + . / DATE OF HEARING 29/01/2016 /0 + . / DATE OF PRONOUNCEMENT 02/02/2016 / O R D E R PER SHRI KUL BHARAT, JUDICIAL MEMBER : THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST TH E ORDER OF THE LD.COMMISSIONER OF INCOME TAX(APPEALS)-V, BARODA [CIT(A) IN SHORT] DATED 30/10/2009 PERTAINING TO ASSESSMENT Y EAR (AY) 2002-03. THE REVENUE HAS RAISED THE FOLLOWING GROUNDS OF APP EAL:- 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD.CIT(APPEALS) HAS ERRED IN RESTRICTING THE ADDITI ON OF RS.26,39,609/- MADE ON ACCOUNT OF ADJUSTMENTS TO TR ANSFER PRICING ITA NO.23/AHD/2 010 DCIT VS. LIQUID CONTROLS INDIA P LTD. ASST.YEAR 2002-03 - 2 - APPLYING AVERAGE RATIO @ 7.27% OF THE FOUR COMPARAB LE COMPANIES TO RS.15,28,587/- BEING 5.78% OF THE THREE COMPARAB LE COMPANIES. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD.CIT(APPEALS) ERRED IN EXCLUSION OF SALES TAX AND EXCISE DUTY IN THE TOTAL TURNOVER FOR THE PURPOSE OF DEDUCTION U/S .80HHC IN VIEW OF THE AMENDMENT BROUGHT IN BY THE INSERTION TO THE PROVISIONS OF SECTION 145(A)(B) OF THE ACT W.E.F. 01.04.1999. 3. THE APPELLANT CRAVES LEAVE TO ADD TO, AMEND OR ALTE R THE ABOVE GROUNDS AS MAY BE DEEMED NECESSARY. RELIEF CLAIMED IN APPEAL IT IS PRAYED THAT THE ORDER OF THE CIT(APPEALS) BE SET ASIDE AND THAT OF THE ASSESSING OFFICER BE RESTORED. 2. AT THE OUTSET, THE LEARNED COUNSEL FOR THE ASS ESSEE CONTENDED THAT AS PER CENTRAL BOARD OF DIRECT TAXES CIRCULAR NO. 2 1/2015 IN F.NO.279/MISC. 142/2007-ITJ (PT) DATED 10TH DECEMBE R 2015, THE REVISED LIMIT FOR PREFERRING REVENUE'S APPEALS IS R S. 10 LACS. HE SUBMITTED THAT THE TAX EFFECT IN THE PRESENT REVENU E'S APPEAL IS BELOW THE PRESCRIBED LIMIT OF RS. 10 LACS. HE, THEREFORE, PLEADED THAT IN VIEW OF THE CBDT CIRCULAR, THE REVENUE'S APPEAL MAY BE DISM ISSED AS THE TAX EFFECT BEING BELOW THE PRESCRIBED LIMIT. 3. THE LD. DEPARTMENTAL REPRESENTATIVE COULD NOT CO NTROVERT THE AFORESAID SUBMISSIONS OF THE LD. COUNSEL FOR THE AS SESSEE. ITA NO.23/AHD/2 010 DCIT VS. LIQUID CONTROLS INDIA P LTD. ASST.YEAR 2002-03 - 3 - 4. WE HAVE HEARD BOTH THE SIDES AND PERUSED THE MAT ERIAL PLACED BEFORE US. WE FIND THAT THE APPEAL OF THE REVENUE IS NOT MAINTAINABLE IN VIEW OF CBDT CIRCULAR NO. 21/2015 IN F.NO.279/MISC. 142/2007-ITJ (PT) DATED 10TH DECEMBER 2015, VIDE WHICH IT HAS BE EN PROVIDED THAT IF THE TAX EFFECT BY VIRTUE OF THE COMMISSIONER OF INC OME-TAX (APPEALS)S ORDER IS BELOW RS. 10 LAKHS, THEN THAT ORDER WOULD NOT BE CHALLENGED BEFORE THE TRIBUNAL IN FURTHER APPEAL. THE BOARD H AS PROVIDED EXEMPTIONS AT CLAUSE (8) OF THE INSTRUCTIONS WHEREI N IT HAS BEEN PROVIDED THAT THESE INSTRUCTIONS WILL NOT BE APPLICABLE, IF VIRES OF ANY PROVISIONS HAS BEEN QUASHED BY IMPUGNED ORDER OR ADDITION WAS MADE ON SOME AUDIT OBJECTIONS OR THE ADDITION RELATES TO UNDISCL OSED FOREIGN ASSETS/BANK ACCOUNTS, ETC. WE FIND THAT THE PRESENT CASE DOE S NOT FALL WITHIN THE EXEMPTION CLAUSE AND THE TAX IS LESS THAN RS. 10 LA KHS. THEREFORE, THE PRESENT APPEAL OF THE REVENUE IS NOT MAINTAINABLE A ND HENCE DISMISSED. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED IN LIMINE. ORDER PRONOUNCED IN THE COURT ON 2 ND FEBRUARY, 2016 AT AHMEDABAD. SD/- SD/- ( ) ( ) ( MANISH BORAD ) ( KUL BHARAT ) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD; DATED 02/ 02 /2016 4..., ,.../ T.C. NAIR, SR. PS ITA NO.23/AHD/2 010 DCIT VS. LIQUID CONTROLS INDIA P LTD. ASST.YEAR 2002-03 - 4 - !'#$%&' &$ / COPY OF THE ORDER FORWARDED TO : 1. $' / THE APPELLANT 2. ()$' / THE RESPONDENT. 3. 56 7 / CONCERNED CIT 4. 7 ( ) / THE CIT(A)-V, BARODA 5. 8,9 (56 , . 560 , / DR, ITAT, AHMEDABAD 6. 9;< =- / GUARD FILE. ! / BY ORDER, )8 ( //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 1.2.16 (TAX LIMIT BELOW 10 L ACS) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER ..1.2.16 3. OTHER MEMBER... 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.2.2.16 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 2.2.16 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER