JCIT (OSD), New Delhi V. M/s Minda Corporation Ltd., New Delhi

ITA 2366/DEL/2011

• Counselvise Citation: [2018] 122 COUNSELVISE.COM (IT) 5389 (ITAT-DELHI)
• Duration Of Justice: 7 year(s) 4 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-10-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 24-05-2017
• Assessment Year: 2007-2008
• Appeal Filed On: 10-05-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHEFALI SWROOP
• Assessee Lawyers: ROHIT JAIN
• Keywords: Depreciation; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH E : NEW DELHI) BEFORE SHRI R.S.SYAL, HONBLE VICE PRESIDENT AND SHRI LALIET KUMAR, ACCOUNTANT MEMBER ITA NO.2366/DEL./2011 (ASSESSMENT YEAR : 2007-08) JCIT(OSD), MINDA CORPORATION LTD. CIRCLE -6 (1), VS. 36A, ROOM NO. 413, RAJASTHAN UDYOG NAGAR C.R.BUILDING NEW DELHI NEW DELHI. PAN : AAACM0344C (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. ROHIT JAIN, ADV. REVENUE BY : SHRI SHEFALI SWROOP, CIT, DR DATE OF HEARING : 08.10.2018 DATE OF ORDER : .10.2018 O R D E R PER LALIET KUMAR, ACCOUNTANT MEMBER : 1. THE PRESENT APPEAL IS FILED BY THE REVENUE CHALLENG ED THE ASSESSEE ON THE FOLLOWING GROUNDS :- 1. THE ORDER OF LEARNED CIT(APPEALS) IS ERRONEOUS & CONTRARY TO FACTS & LAW. 2.ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDIT ION OF RS. 7,29,899/- MADE ON ACCOUNT OF DEPRECIATION. 2.1 THE LD. CIT(A) IGNORED THE FINDING RECORDED BY THE ASSESSING OFFICER AND THE FACT THAT THE ASSETS WERE NOT PUT TO USE DURING THE YEAR. ITA NO.2366/DEL./2011 2 3. ON THE FACTS IN THE CIRCUMSTANCES OF THE CASE AN D IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION O F RS. 7,29,899/- MADE ON ACCOUNT OF DEPRECIATION. 3.1 THE LD. CIT(A) IGNORED THE FINDING RECORDED BY THE ASSESSING OFFICER AND THE FACT THAT THE ASSETS WERE NOT PUT TO USE DURING THE YEAR. 4. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION O F RS. 5,38,287/- MADE ON ACCOUNT OF BAD ASSETS. 4.1 THE LD. CIT(A) IGNORED THE FINDINGS RECORDED BY THE ASSESSING OFFICER AND THE FACT THAT THE ASSESSEE CO ULD NOT FILE ANY EVIDENCE SUPPORT OF ITS CONTENTION THAT THE DEF ECTIVE GOODS WERE RETURNED. 5. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION O F RS. 11,33,760/- BEING THE 10% OF LEGAL EXPENSES. 5.1 THE LD. (A) IGNORED THE FINDING RECORDED BY THE ASSESSING OFFICER AND THE FACT THAT THE ASSESSEES C OULD NOT JUSTIFY THE HUGE EXPENSES DURING ASSESSMENT PROCEED INGS. 6. ON THE FACTS IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION O F RS. 57,725/- MADE ON ACCOUNT OF DEPRECIATION CAR SOLD D URING THE YEAR. 6.1 THE LD. CIT(A) IGNORED THE FINDING RECORDED BY THE ASSESSING OFFICER AND THE FACT THAT AS PER I.T. ACT NO DEPRECIATION IS ALLOWED ON ASSETS SOLD DURING THE Y EAR. 7. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE AND IN LAW, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDIT ION OF RS. 13,77,297/- MADE ON ACCOUNT OF WARRANTY EXPENSES. ITA NO.2366/DEL./2011 3 7.1 THE LD. CIT(A) IGNORED THE FINDING RECORDED BY THE ASSESSING OFFICER AND THE FACT THAT THE ASSESSEE DI D NOT FILE THE NECESSARY DETAILS DURING THE ASSESSMENT PROCEED ING TO SUBSTANTIATE ITS CLAIM. 2. THE PERUSAL OF THE ABOVE, IT IS CLEAR THAT THE T OTAL AMOUNT FOR WHICH THE PRESENT APPEAL IS FILED BY RS. 7,29,899/- + 5,38,287/-+ 11,33,760/-+57,725/-+ 13,77,297/-. MAKING TOTAL FOR RS. 3,836,968/- . AS THE ABOVE AND THE TOTAL TAX DEMAN D ON THE SEARCH, DELETION OF THE ADDITION MADE BY THE ASSESSING OFFI CER WOULD BE LESS THAN 20 LAKHS THEN SIMILARLY THE CBDT CIRCULAR NO.3/2018 DATED 11 TH JULY, 2018 VIDE WHICH THE REVENUE HAS BEEN DIRECTE D NOT TO PREFER ANY APPEAL IN CASE THE TAX EFFECT IS LESS THAN RS.20,00,000/- AND THIS FACTUAL POSITION HAS BEEN F AIRLY CONCEDED BY THE LD. D.R. THE LD. A.R. CONTENDED THAT THE AP PEAL OF THE REVENUE MAY BE DISMISSED IN THE LIGHT OF CBDT CIRCU LAR (SUPRA). 3. AFTER PERUSING THE MATERIALS AVAILABLE ON RECOR D, WE FIND THAT THE AMOUNT DISPUTED BEFORE US IS BELOW THE TAX EFFE CT LIMIT PRESCRIBED BY CBDT VIDE CIRCULAR NO. 3/2018 DATED 1 1.07.2018 FOR PREFERRING APPEALS BEFORE TRIBUNAL BY THE REVEN UE. ON PERUSAL OF THE CIRCULAR NO. 3/2018 DATED 11.07.2018 AND THE MA TERIALS AVAILABLE ON RECORD, LD. SR. DR COULD NOT POINT OU T AS TO HOW AND WHY SUCH A CIRCULAR IS NOT APPLICABLE TO THE FACTS OF THE CASE. WE ALSO FIND THAT THE CIRCULAR MAKES IT VERY CLEAR THA T THE REVISED MONETARY LIMITS SHALL APPLY RETROSPECTIVELY TO PEND ING APPEALS ALSO. WE FIND THAT THE CIRCULAR IS BINDING ON THE TAX AUT HORITIES. HENCE, WE HOLD THAT THE APPEAL OF THE REVENUE DESERVES TO BE DISMISSED IN TERMS OF LOW TAX EFFECT VIDE CIRCULAR NO. 3/2018 DA TED 11.07.2018. ACCORDINGLY, THIS BEING A LOW TAX EFFECT CASE, WE D ISMISS THIS ITA NO.2366/DEL./2011 4 APPEAL OF REVENUE IN LIMINE, AS UNADMITTED, WITHOUT GOING INTO THE MERITS OF THE CASE. 4. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISSE D. ORDER PRONOUNCED IN OPEN COURT ON THIS 09 TH OCTOBER, 2018. SD/- SD/- (R.S.SYAL) (LA LIET KUMAR) VICE PRESIDENT ACCOUNTANT MEMBER DATED 09/10/ 2018 BR COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A)-XXVI, NEW DELHI. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI. DATE OF DICTATION 08.10.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 08 .10.2018 DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE OTHER MEMBER 09.10.2018 DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. PS/PS 09.10.2018 DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT 09.10.2018 DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. PS/PS 09.10.2018 DATE ON WHICH THE FINAL ORDER IS UPLOADED ON THE WEBSITE OF ITAT 09.10.2018 DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .10.2018 DATE ON WHICH THE FILE GOES TO THE HEAD CLERK THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGISTRAR FOR SIGNATURE ON THE ORDER DATE OF DISPATCH OF THE ORDER