ITO, New Delhi V. M/s. Sky Lark Marketing, Delhi

ITA 2377/DEL/2013

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0071 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-05-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 21-05-2015
• Assessment Year: 2001-2002
• Appeal Filed On: 23-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Accommodation entries; Tax effect
• Section: 147; 148

Judgement Text

1 ITA NO. 2377 & 2388/DEL/13 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: G NEW DELHI BEFORE SH. S. V. MEHROTRA, JUDICIAL MEMBER AND SH. ABY T. VARKEY, ACCOUNTANT MEMBER I.T.A .NO.-237 7 & 2378/DEL/2013 (ASSESSMENT YEA R-2001-02) ) ITO WARD-36(1) H-BLOCK, VIKAS BHAWAN NEW DELHI (APPELLANT) VS SKY LARK MARKETING G-20, I. J. COMPLEX LAXMI NAGAR, DELHI (RESPONDENT) APPELLANT BY SH.BRR KUMAR, SR. DR. RESPONDENT BY SH.PRADEEP KUMAR, ADV ORDER PER A.T.VARKEY, JM BY THE PRESENT APPEAL FILED BY THE REVENUE THE CORR ECTNESS OF THE ORDER DATED 11/1/2013 OF LD. CIT(A)XXVII, NEW DELHI PERTAINING TO 2001-02 ASSESSMENT YEAR HAS BEEN ASSAILED ON THE FOLLOWING GROUNDS. ITA NO. 2377/DEL/13 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LD. CIT(A) HAD ERRED IN LAW AND ON FACTS IN ANNULLING THE ASSESSME NT ORDER DATED 28/11/2008 FOR THE ASSTT. YEAR 2001-02 PASSED U/S 1 44/147 OF THE I.T. ACT. NO WRITTEN SUBMISSION WAS FILED BY THE ASSESSEE AT THE APPELLATE STAGE AS IS EVIDENT FROM PARA 6 OF THE APPEAL ORDER AND THE CIT (A) DECIDED THE APPEAL ON MERIT. (II) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) OUGHT TO HAVE CONSIDERED THE FACT THAT NOTICE U/S14 8 WAS ISSUED ON 28/3/2008 AND SENT BY SPEED POST AT THE ADDRESS ON RECORD, WITHIN 6 YEARS OF THE RELEVANT ASSESSMENT YEAR 2001-02 AS PER REQU IREMENT OIF SECTION 149 OF THE I.T. ACT, AFTER OBTAINING APPROVAL OF JCIT, RANGE-36, NEW DELHI DATE OF HEARING 21/5/2015 DATE OF PRONOUNCEMENT 22/05/2015 2 ITA NO. 2377 & 2388/DEL/13 U/S151 OF THE I.T. ACT. THE SERVICE OF NOTICE U/S 148 IS NOT A RRECONDITION FOR CONFERMENT OF JURISDICTION U/S 147 OF THE I.T. ACT.. (III)ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A)WITHOUT GIVING ANY FINDING ON MERIT OF THE CA SE ON ACCOMMODATION ENTRIES OF RS.10,32,500/- RECEIVED BY THE ASSESSEE, ANNULLED THE ASSESSMENT ORDER, EVEN WHEN NUMBER OF OPPORTUNITIES WERE GIVEN TO THE ASSESSEE BY WAY OF NOTICES U/S142(1) AT THE ADDRESSES AVAILABLE ON RECORDS. (IV) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE ORDER OF THE A.O MAY BE RESTORED AND THAT OF CIT(A) MAY BE ST ASIDE. (V) THE APPELLANT CRAVES LEAVE TO ADD, ALLOW OR A MEND ANY OR ALL THE GROUNDS OF APPEAL BEFORE OR DUIRNG THE COURSE OF HE ARING OF THE APPEAL. ITA NO. 2388/DEL/13 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN LAW AND ON FACTS IN CANCELLING THE PENALTY ORDER DATED 22/5/2009, IMPOSING PENALTY OF RS.3,97,512/- U/S 27 1(1)(C ) OF THE I.T ACT ON THE GROUND THAT ASSESSMENJT ORDER DATED 28/1 1/2008 FOR THE A.Y 2001-02 PASSED U/S 144/147 OF THE I.T ACT, HAS BEEN ANNULLED VIDE APPELLATE ORDER IN APPEAL NO. 80/10-11 DATED 11/1/2 003. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE DEPARTMENT HAS FILED AN APPEAL AGAINS THE ORDER OF CIT(A) IN APPEA L NO. 80/10-11 AND ON THE FACTS AND IN THE CIRCUMSTNACES OF THE CASE, THE ORDER OF THE A.O MAY BE RESTORED AND THAT OF CIT(A) MAY BE SET ASIDE . 3. THE APPELLANT CRAVES LEAVE TO ADD, ALLOW OR AMEND ANY OR ALL THE GROUNDS OF APPEAL BEFORE OR DUIRNG THE COURSE OF HE ARING OF THE APPEAL. 2. RIGHT AT THE OUTSET LD. AR APPEARING ON BEHALF OF THE ASSESSEE OBJECTED TO THE MAINTAINABILITY OF THE PRESENT APPEAL ON THE GROUND S THAT THE TAX INVOLVED IS LESS THATN RS. 4 LAKH AS SUCH IT IS CONTRARY TO INSTRUCTION NO . 5/2014 DATED 10/7/2014 WHICH HAS FIXED THE MONETARY LIMIT OF RS. 4 LAKH. IN SUPPORT OF HIS CLAIM RELIANCE WAS PLACED ON VARIOUS ORDERS OF THE CO-ORDINATE BENCH AND ALSO JU DGMENT OF THE APEX COURT IN ALEXANDER GEORGE VS. CIT (2015) 373 49(SC). THE LD . SR. DR STATED THAT ALTHOUGH THE TAX EFFECT INVOLVED IN THE PRESENT APPEAL WAS L ESS THAN RS. 4 LAKH, HOWEVER, ON THE DATE OF FILING THE APPEAL THE LIMIT WAS R. 3 LAKH. NO CONTRARY DECISION WAS CITED BY HIM IN ORDER TO CANVASS THAT A CONTRARY VIEW CAN BE TAK EN. 3. WE HAVE HEARD RIVAL SUBMISSIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. ADMITTEDLY AS PER RECENT CBDT INSTRUCTION NO. 5/201 4 DATED 10/7/2014, THE MONETARY 3 ITA NO. 2377 & 2388/DEL/13 LIMIT FOR FILING APPEAL BY THE DEPARTMENT BEFORE TH E ITAT HAS BEEN REVISED TO RS.4 LACS. CONSIDERING THE SAME, IT IS ALSO SEEN THAT THE CO-O RDINATE BENCHES AT DELHI CONSISTENTLY HAVE HELD THAT THE DEPARTMENTAL APPEALS, INVOLVING TAX EFFECT BELOW RS. 4 LACS, ARE NOT MAINTAINABLE BEFORE THE ITAT. THE VIEW HAS BEEN TA KEN FOLLOWING THE DECISION OF THE HONBLE JURISDICTIONAL DELHI HIGH COURT IN THE CASE OF CIT VS. DELHI RACE CLUB LTD. REFERENCE MAY ALSO BE MADE TO THE ORDER DATED 3/3/ 2011 WHERE BY FOLLOWING THE EARLIER ORDER DATED 2/8/2010 IN ITA NO. 179/1991 IN THE CASE OF CIT DELHI-IIIVS. M/S P.S. JAIN & CO., IT HAS HELD THAT SUCH INSTRUCTION/ CIRCULAR WOULD ALSO BE APPLICABLE TO PENDING CASES. RELIANCE HAS ALSO BEEN PLACED ON 31 9 ITR 347 (DELHI) AND 335/ITR 591(DELHI) .IN THE FACTS OF THE PRESENT CASE ADMITT EDLY THE TAX EFFECT INVOLVED IS BELOW RS.4 LAKHS WHICH HAS NOT BEEN DISPUTED BY THE LD. S R. DR. THEREFORE, IN VIEW OF THE REVISED INSTRUCTION OF THE CBDT, REFERRED TO ABOVE, AND FOLLOWING THE DECISIONS OF THE JURISDICTIONAL HIGH COURT IN THE CASE OF DELHI RACE CLUB LTD., ETC. SUPRA, THE DEPARTMENTAL APPEAL , IT IS SEEN IS NOT MAINTAINABL E. 3. RESPECTFULLY FOLLOWING THE DECISION OF THE JURIS DICTIONAL HIGH COURT IN VIEW OF THE ABOVE FACTUAL POSITION WE HOLD THAT INSTRUCTIO N NO.5/2014 DATED 10/07/2014 WILL APPLY TO THE PRESENT APPEAL. AS A RESULT, THE DEPA RTMENTS APPEAL IS DISMISSED AS NOT MAINTAINABLE. 4. IN THE RESULT, APPEAL FILED BY THE DEPARTMENT IS DISMISSED WITHOUT GOING INTO THE MERITS. THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 22 ND OF MAY , 2015. SD/- SD/- (S.V. MEHROTRA) (ABY. T. VARKEY) JUDICIAL MEMBER ACCOUNTANT M EMBER DATED: 22 /05/2015 4 ITA NO. 2377 & 2388/DEL/13 *R. NAHEED* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI SL.NO. DESCRIPTION DA TE 1. DATE OF DICTATION BY THE AUTHOR 21/05/2015 2. DRAFT PLACED BEFORE THE DICTATING MEMBER 3. DRAFT PLACED BEFORE THE SECOND MEMBER 4. DRAFT APPROVED BY THE SECOND MEMBER 5. DATE OF APPROVED ORDER COMES TO THE SR. PS 6. DATE OF PRONOUNCEMENT OF ORDER 7. DATE OF FILE SENT TO THE BENCH CLERK 8. DATE ON WHICH FILE GOES TO THE HEAD CLERK 9. DATE OF DISPATCH OF ORDER