ACIT, New Delhi V. Sh. Rakesh Yadav, New Delhi

ITA 2390/DEL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 86575 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 8 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-01-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Next Hearing Date: 02-12-2014
• Assessment Year: 2009-2010
• Appeal Filed On: 23-04-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIKRAM SAHAY
• Assessee Lawyers: V RAJ KUMAR
• Keywords: Rejection of books of accounts; Business income; Retrospective amendment; Tax effect

Judgement Text

ITA NO. 2390 / DEL/2013 ACIT VS. SHRI RAKESH YADAV 1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F NEW DELHI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT AND SHRI A.T. VARKEY , JUDICIAL MEMBER ITA NO. 2390 /DEL/2013 ASSESSMENT YEAR: 2009 - 10 ACIT VS. SHRI RAKESH YADAV CIRCLE - 38 (1) R/O 62/5 - B BER SARAI, NEW DELHI. OPP. JNU CAMPUS, NEW DELHI. (PAN AATPY3814D) (APPELLANT) (RESPONDENT) APPELLANT BY: SHRI VIK RAM SAHAY, SR. DR RESPONDENT BY: SHRI K. SAMPATH AND SHRI V RAJ KUMAR, ADVOCATE O R D E R PER A.T. VARKEY , JUDICIAL MEMBER THIS APPEAL BY THE DEPARTMENT IS DIRECTED AGAINST THE ORDER DA TED 10.1.2013 OF CIT(A) X XVI II , N EW DELHI FOR THE ASS T T. YEAR 2009 - 10 . 2. THE GROUNDS RAISED IN THE APPEAL OF THE DEPARTMENT READ AS UNDER : - 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 4,37,383 / - MADE BY AO WITHOUT APPRECIATING THE FACT THAT AO HAS MADE THE ADDITION AFTER REJECTION OF BOOKS OF ACCOUNTS AND THE AS S E S SEE HAS FAILED TO FURNISH BOOKS OF ACCOUNTS AND SUPPORTING DOCUMENTS AND ALSO FAILED TO RECONCILE HIS BUSINESS RECEIPTS DURING THE C OURSE OF THE ASSESSMENT PROCEEDINGS DESPITE SPECIFIC DIRECTION OF THE AO. 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 4,82,448/ - MADE BY AO ON ACCOUNT OF DISALLOWANCE OF LOSS OF THE ASSESSEE WITHOUT APPRECIATING THE FACT THAT ITA NO. 2390 / DEL/2013 ACIT VS. SHRI RAKESH YADAV 2 THE ASSESSEE FAILED TO SUBSTANTIATE ITS CLAIM DURING THE ASSESSMENT PROCEEDINGS. 3. DURING THE COURSE OF HEARING, LD. COUNSEL FOR THE ASSESSEE AT THE VERY OUTSET STATED THAT THE TAX EFFECT IN THIS APPEAL IS LESS THAN RS. 4 ,00,000/ - , THEREFORE, THE DEPARTMENT OUGHT NOT TO HAVE FILED THIS APPEAL IN VIEW OF THE CIRCULAR ISSUED BY THE CBDT AND THE PROVISIONS CONTAINED IN SECTION 268A OF THE INCOME TAX ACT 1961 (HEREINAFTER TO BE REFERRED AS THE ACT). 4. AS PER THE LD. COUN SEL THE COMPUTATION OF THE DISPUTED TAX AS PER GROUND NO. 1 IS RS. 4,37,383/ - AND GROUND 2 IS RS. 4,82,448/ - . THEREFORE THE TOTAL AMOUNT CONTESTED IS RS. 9,19,831/ - . SO, THE TAX EFFECT IS @ 30% WOULD WORK OUT TO BE RS. 2,75,949/ - AND AFTER ADDING EDUCAT ION CESS @ 2% AND HIGHER EDUCA TION CESS @ 10%, TOTAL COMES TO RS. 2,84,226/ - ONLY AND SO IS LESS THAN RS. 3 LAKHS ONLY AND SO THE DEPARTMENT OUGHT NOT TO HAVE FILED THE APPEAL AND PRAYED THAT THE INSTANT CASE MAY BE DISMISSED. 5 . ON THE OTHER HAND, THE L D. DR ALTHOUGH SUPPORTED THE ORDER OF AO, BUT COULD NOT CONTROVERT THIS FACT THAT THE TAX EFFECT IN THIS APPEAL IS LESS THAN RS. 4,00,000/ - . 6 . AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE PARTIES AND THE MATERIAL ON RECORD, IT IS NOTICED THAT SECTIO N 268A HAS BEEN INSERTED BY THE FINANCE ACT, 2008 WITH RETROSPECTIVE EFFECT FROM 01/04/1999. THE RELEVANT PROVISIONS CONTAINED IN SECTION 268A READ AS UNDER: 268A. (1) THE BOARD MAY, FROM TIME TO TIME, ISSUE ORDERS, INSTRUCTIONS OR DIRECTIONS TO OTHER INCOME - TAX AUTHORITIES, FIXING SUCH MONETARY LIMITS AS IT MAY ITA NO. 2390 / DEL/2013 ACIT VS. SHRI RAKESH YADAV 3 DEEM FIT, FOR THE PURPOSE OF REGULATING FILING OF APPEAL OR APPLICATION FOR REFERENCE BY ANY INCOME - TAX AUTHORITY UNDER THE PROVISIONS OF THIS CHAPTER. (2) WHERE, IN PURSUANCE OF THE ORDERS, INSTRUCTIONS OR DIRECTIONS ISSUED UNDER SUB - SECTION (1), AN INCOME - TAX AUTHORITY HAS NOT FILED ANY APPEAL OR APPLICATION FOR REFERENCE ON ANY ISSUE IN THE CASE OF AN ASSESSEE FOR ANY ASSESSMENT YEAR, IT SHALL NOT PRECLUDE SUCH AUTHORITY FROM FILING AN APPE AL OR APPLICATION FOR REFERENCE ON THE SAME ISSUE IN THE CASE OF (A) THE SAME ASSESSEE FOR ANY OTHER ASSESSMENT YEAR; OR (B) ANY OTHER ASSESSEE FOR THE SAME OR ANY OTHER ASSESSMENT YEAR; (3) NOTWITHSTANDING THAT NO APPEAL OR APPLICATION FOR REFERENC E HAS BEEN FILED BY AN INCOME - TAX AUTHORITY PURSUANT TO THE ORDERS OR INSTRUCTIONS OR DIRECTIONS ISSUED UNDER SUB - SECTION (1), IT SHALL NOT BE LAWFUL FOR AN ASSESSEE, BEING A PARTY IN ANY APPEAL OR REFERENCE, TO CONTEND THAT THE INCOME - TAX AUTHORITY HAS AC QUIESCED IN THE DECISION ON THE DISPUTED ISSUE BY NOT FILING AN APPEAL OR APPLICATION FOR REFERENCE IN ANY CASE. (4) THE APPELLATE TRIBUNAL OR COURT, HEARING SUCH APPEAL OR REFERENCE, SHALL HAVE REGARD TO THE ORDERS, INSTRUCTIONS OR DIRECTIONS ISSUED UND ER SUB - SECTION (1) AND THE CIRCUMSTANCES UNDER WHICH SUCH APPEAL OR APPLICATION FOR REFERENCE WAS FILED OR NOT FILED IN RESPECT OF ANY CASE. (5) EVERY ORDER, INSTRUCTION OR DIRECTION WHICH HAS BEEN ISSUED BY THE BOARD FIXING MONETARY LIMITS FOR FILING A N APPEAL OR APPLICATION FOR REFERENCE SHALL BE DEEMED TO HAVE BEEN ISSUED UNDER SUB - SECTION (1) AND THE PROVISIONS OF SUB - SECTIONS (2), (3) AND (4) SHALL APPLY ACCORDINGLY. 7 . IT IS NOT IN DISPUTE THAT THE BOARDS INSTRUCTION OR DIRECTIONS ISSUED TO THE OTHER INCOME - TAX AUTHORITIES ARE BINDING ON THOSE AUTHORITIES, THEREFORE, THE DEPARTMENT OUGHT NOT TO HAVE FILED THE APPEAL IN VIEW OF THE ABOVE MENTIONED SECTION 268A SINCE THE TAX EFFECT IN THE INSTANT CASE IS LESS THAN THE AMOUNT PRESCRIBED FOR NOT FILING THE APPEAL. 8 . IT IS NOTICED THAT THE CBDT HAS ISSUED INSTRUCTION NO. 5/2014 DATED 10 TH JULY, 2014, BY WHICH THE CBDT HAS REVISED THE MONETARY LIMIT TO RS. 4,00,000/ - FOR FILING THE APPEAL BEFORE THE TRIBUNAL. 9 . KEEPING IN VIEW T HE CBDT INSTRUCTION NO. 5 OF 2014 DATED 10TH JULY, 2014 AND ALSO THE PROVISIONS OF SECTION 268A OF INCOME TAX ACT, 1961, WE ARE OF THE ITA NO. 2390 / DEL/2013 ACIT VS. SHRI RAKESH YADAV 4 VIEW THAT THE REVENUE SHOULD NOT HAVE FILED THE INSTANT APPEAL BEFORE THE TRIBUNAL. WHILE TAKING SUCH A VIEW, WE ARE FOR TIFIED BY THE FOLLOWING DECISIONS OF THE HONBLE PUNJAB & HARYANA HIGH COURT: 1. CIT VS. OSCAR LABORATORIES P. LTD. (2010) 324 ITR 115 (P&H); 2. CIT VS. ABINASH GUPTA (2010) 327 ITR 619 (P&H); 3. CIT VS. VARINDE RA CONSTRUCTION CO. (2011) 331 ITR 449 (P&H) (FB). 10 . SIMILARLY, THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. DELHI RACE CLUB LTD. IN ITA NO. 128/2008, ORDER DATED 03.03.2011 BY FOLLOWING THE EARLIER ORDER DATED 02.08.2010 IN ITA NO. 179/1991 IN THE CASE OF CIT DELHI - III VS. M/S P.S. JAIN & CO. HELD THAT SUCH CIRCULAR WOULD ALSO BE APPLICABLE TO PENDING CASES. 11 . THUS, FROM THE RATIO LAID DOWN BY THE HONBL DELHI HIGH COURT, IT IS CLEAR THAT THE INSTRUCTIONS ISSUED IN THE CIRCULARS BY CB DT ARE APPLICABLE FOR PENDING CASES ALSO. THEREFORE, BY KEEPING IN VIEW THE RATIO LAID DOWN IN THE AFORESAID REFERRED TO CASE, WE ARE OF THE CONSIDERED VIEW THAT INSTRUCTION NO. 5 OF 2014 DATED 10TH JULY, 2014 ISSUED BY THE CBDT ARE APPLICABLE FOR THE PEN DING CASES ALSO AND IN THE SAID INSTRUCTIONS, MONETARY TAX LIMIT FOR NOT FILING THE APPEAL BEFORE THE ITAT IS RS. 4,00,000/ - . 12 . IN VIEW OF THE ABOVE, WITHOUT GOING INTO MERIT OF THE CASE, WE DISMISS THE APPEAL FILED BY THE REVENUE. 13 . IN THE RE SULT, APPEAL OF THE REVENUE IS DISMISSED. O RDER PRONOUNCED IN THE OPEN COURT ON 09 TH JANUARY, 2015. - SD/ - - SD/ - ( G.D. AGRAWAL ) ( A.T. VARKEY ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED :09 TH JANUARY, 2015 ITA NO. 2390 / DEL/2013 ACIT VS. SHRI RAKESH YADAV 5 VEENA COPY OF ORDER FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT(A) 4. CIT 5. DR BY ORDER DEPUTY REGISTRAR, ITAT