ACIT, Jalgaon V. B.C.Biyani Project P.Ltd., Jalgaon

ITA 2427/PUN/2012

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 76037 (ITAT-PUNE)
• Duration Of Justice: 1 year(s) 1 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 10-12-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S P WALIMBE
• Keywords: Opportunity of being heard; Agreed addition; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B, PUNE BEFORE SHRI SHAILENDRA KUMAR YADAV, JUDICIAL MEMBER, AND SHRI R.K. PANDA, ACCOUNTANT MEMBER ITA NOS.2426 & 2427/PN/2012 (A.Y. 2009-10) JT. CIT, RANGE-2, JALGAON APPELLANT VS. B.C. BIYANI PROJECT PVT. LTD., BIYANI CHAMBERS, JAMMER ROAD, PROFESSOR COLONY, BHUSAWAL, DIST. JALGAON PAN: AACCB3617R RESPONDENT CO NOS.2 & 3/PN/2013 (ARISING OUT OF ITA NOS.2426 & 2427/2012) (A.Y. 2009-10) B.C. BIYANI PROJECT PVT. LTD., BIYANI CHAMBERS, JAMMER ROAD, PROFESSOR COLONY, BHUSAWAL, DIST. JALGAON PAN: AACCB3617R CROSS OBJECTOR VS. JT. CIT, RANGE-2, JALGAON APPELLANT ASSESSEE BY : SHRI M.K. KU LKARNI DEPARTMENT BY : SHRI S.P. WALIMBE DATE OF HEARING : 06.01.2014 DATE OF ORDER : 15.01.2014 ORDER PER BENCH: 2 TWO APPEALS FILED BY REVENUE AND TWO CROSS OBJECTI ONS FILED BY ASSESSEE ARE ARISING OUT OF RESPECTIVE ORDERS OF CI T(A)-II, NASHIK PERTAINING TO THE SAME ASSESSEE ON ALMOST COMMON IS SUES. SO THESE WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY T HIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 2. IN ITA NO.2426/PN/2012, THE REVENUE RAISED THE F OLLOWING GROUNDS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN DELETING THE PENALTY LEVIED U/S.221 AM OUNTING TO RS.60,61,968/-. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN NOT CONSIDERING THE FACT THAT THE A.O. WHILE PASSING THE PENALTY ORDER HAS RECORDED FINDING THAT THE ASSESSEE WAS NOT HAVING GOOD AND SUFFICIENT REASON TO JUSTIFY THE NON LEVY OF PENALTY. FURTHER, THE PAYMENTS MADE BY THE ASSESSEE WERE AFTER PASSING THE PENALTY ORDER. 3. THE APPELLANT CRAVES LEAVE TO AMEND, ADD, ALTER THE ABOVE GROUNDS, IF FELT NECESSARY, LATER. 2.1 THE ASSESSEE IS A PRIVATE LIMITED COMPANY. IN T HIS CASE ASSESSMENT HAS BEEN FINALIZED U/S.143(3) ON 02.12.2 011 DETERMINING TOTAL INCOME AT RS.8,99,94,310/- ON AGR EED BASIS THEREBY RAISING A DEMAND OF RS.2,42,47,870/-. THE S AID ORDER ALONG WITH DEMAND NOTICE U/S.156 OF THE IT ACT DULY SERVE D ON THE ASSESSEE COMPANY ON 20.12.2011. AS PER THE PROVISI ONS OF I T ACT, 1961, THE ASSESSEE COMPANY WAS REQUIRED TO PAY THE DEMAND ON OR BEFORE 19.01.2012 I.E. WITHIN 30 DAYS FROM THE DATE OF RECEIPT OF THE DEMAND NOTICE AND CHALLAN. SINCE THE ASSESSEE COMP ANY HAS NEITHER MADE THE ABOVE PAYMENT NOR OBTAINED ANY INS TALLMENTS/STAY OF DEMAND, A NOTICE U/S.221 DATED 27.01.2012 WAS DU LY ISSUED AND SERVED ON THE ASSESSEE COMPANY. IN RESPONSE TO THE ABOVE NOTICE, THE ASSESSEE COMPANY FILED A LETTER DATED 06.02.201 2 STATING THEREIN AS UNDER: 3 'WE HAVE NOT FILED ANY APPEAL AGAINST THIS ORDER, A S THIS IS AN AGREED ADDITION, AND WE ARE READY TO PAY THIS DEMAN D BUT OUR COMPANY IS FACING THE STRINGENT FINANCIAL DIFFICULT IES AS OUR ALL BANKING FINANCIAL CREDIT FACILITIES ARE DECLARED AS NPA BY THE BANK, DUE TO NON AVAILABILITY OF OUR OWN FUNDS OR B ANKING FACILITIES, THE MAJOR PORTION OF OUR MAIN CONTRACT SITE OF NVDA, KHAGONE HAS BEEN SUBLET TO OTHER AGENCIES, ON WHICH WE ARE SUFFERING HEAVY REVENUE LOSS AND FACING FINANCIAL C RUNCH, HENCE THERE IS A SCARCITY OF THE FUNDS IN OUR BUSINESS. H OWEVER, WE ARE GOING TO OBTAIN THE FUNDS FROM OTHER SOURCES, F OR PAYMENT OF DUES OUTSTANDING, WHICH WILL TAKE SOME TIME. WE ASSURE YOU TO MAKE THE PAYMENT AT AN EARLIEST. SO THE PROPOSED PENALTY PROCEEDINGS U/S 221(1) MAY PLEASE BE KEPT PENDING. FOR WHICH ACT OF KINDNESS WE SHALL REMAIN GRATEFUL TO YOU'. WE ARE SUBMITTING HEREWITH THE FOLLOWING BANK ACCOU NTS FOR YOUR KIND CONSIDERATION I) HDFC BANK, BHUSAWAL BRANCH A/C. NO.07922320000869 II) UCO BANK, BHUSAWAL BRANCH CC A/C.NO.1 06605500006588 III) STATE BANK OF INDIA, BHUSAWAL BRANCH A/C. NO. 30367 4 70067 2.2 AFTER GOING THROUGH THE DETAILS OF COPIES OF BA NK ACCOUNT, THE ASSESSING OFFICER FOUND THAT THE ASSESSEE COMPANY H AD RECEIVED VARIOUS AMOUNTS ON VARIOUS DATES WHICH WERE EITHER TRANSFERRED OR WITHDRAWN. THE ASSESSING OFFICER HAS OBSERVED THAT THE ASSESSEE COMPANY WAS HAVING SUFFICIENT CASH BALANCE WHICH IT HAS EITHER DEPOSITED OR TRANSFERRED FROM ONE PLACE TO ANOTHER BY DEPOSITING CASH. THE ASSESSING OFFICER WAS OF THE VIEW THAT T HE ASSESSEE COMPANY WAS DELIBERATELY AVOIDING TO MAKE PAYMENT O F INCOME TAX DUES AND HAS MADE ITSELF LIABLE FOR PENALTY. THE A SSESSEE HAS FAILED TO MAKE THE PAYMENT OF DEMAND WITHIN THE PRESCRIBED TIME LIMIT AND HAS ALSO FAILED TO FURNISH ANY SATISFACTORY EXPLANA TION AS TO WHY THE PENALTY U/S.221(1) SHOULD NOT BE LEVIED. THE ASSES SING OFFICER THEREFORE, HELD THAT THE ASSESSEE COMPANY HAS COMMI TTED A DEFAULT IN MAKING THE PAYMENT OF INCOME TAX DEMAND EVEN AFT ER A REASONABLE OPPORTUNITY OF BEING HEARD IN THE MATTER WAS GIVEN TO IT. ACCORDINGLY, THE ASSESSEE WAS LEVIED PENALTY U/S.22 1 OF RS.60,61,968/- I.E. 25% OF THE OUTSTANDING DEMAND U /S.221 OF THE 4 IT ACT. THE MATTER WAS CARRIED BEFORE FIRST APPELL ATE AUTHORITIES, WHO HAVING GONE THROUGH THE SUBMISSIONS, FORWARDED TO T HE ASSESSING OFFICER TO THE REMAND REPORT AND HAVING RECEIVED TH E SAME, CIT(A) GRANTED THE RELIEF TO THE ASSESSEE AND THE SAME HAS BEEN OPPOSED BEFORE US ON BEHALF OF REVENUE, INTER ALIA STATED T HAT CIT(A) HAS NOT JUSTIFIED IN DELETING THE PENALTY U/S.221 OF AMOUNT ING RS.60,61,968/-. THE CIT(A) ERRED IN CONSIDERING TH E FACT THAT THE ASSESSING OFFICER WHILE PASSING THE PENALTY ORDER U /S.221 HAS RECORDED THE FINDINGS THAT THE ASSESSEE WAS NOT HAV ING GOOD AND SUFFICIENT REASONS TO JUSTIFY THE NON-LEVY OF THE P ENALTY. ON THE OTHER HAND, THE LEARNED AUTHORIZED REPRESENTATIVE HAS SUP PORTED THE ORDER OF CIT(A). 2.3 AFTER GOING THROUGH THE RIVAL SUBMISSIONS AND M ATERIAL ON RECORD, WE FIND THAT THE ASSESSEE HAS OFFERED INCOM E AT 14% TOTAL CONTRACT RECEIPTS AS STATED IN SUBMISSIONS OF LETTE R DATED 02.12.2011 WHICH READ AS UNDER: SO LOOKING TO THE ABOVE DISCREPANCIES IN OUR BOOKS OF ACCOUNTS, AND TO PURCHASE THE PEACE OF MIND AND TO AVOID THE LITIGATIONS, WE ARE OFFERING TO ESTIMATE THE PERCEN TAGE OF PROFIT FOR THE PERIOD 01/04/2008 TO 31/03/2009 A. Y. 2009- 10 @ 14% ON THE TOTAL CONTRACT BUSINESS OF F 59,64,06,76 6/- FOR ASSESSMENT PURPOSE SUBJECT TO NO PENAL ACTION U.S 2 71(L)(C) OF THE I T ACT 1961 MAY PLEASE BE TAKEN. IT IS ALSO REQUESTED THAT THE COMPANY IS FACING THE STRINGENT FINANCIAL DIFFICULTIES, THE BANK ACCOUNT OF THE COM PANY ARE CLASSIFIED AS NPA BY THE UCO BANK, BHUSAWAL, SINCE MARCH 2011 TILL DATE, DUE TO NON SERVICE OF INTEREST AND OUTSTANDING INSTALLMENTS. THEREFORE WE MAY BE ALLOWED TO PAY TH E ASSESSMENT DEMAND IN MONTHLY INSTALLMENTS. HOWEVER WE WILL TRY TO PAY THE MAXIMUM DEMAND BEFORE THE END OF THE FINANCIAL YEAR I.E. MARCH 2012.' FROM THE ABOVE, IT IS CLEAR THAT THE ASSESSEE OFFER ED INCOME @ 14% OF THE TOTAL CONTRACT RECEIPTS SUBJECT TO NO PE NAL ACTION U/S. 271(L)(C) OF THE ACT. THE ASSESSING OFFICER HAD CON SIDERED THE ABOVE LETTER AS IS EVIDENT FROM HIS NOTING AT PARA 5 OF T HE ASSESSMENT ORDER DATED 02.12.2011. THE ASSESSING OFFICER ACCEPTED TH E ASSESSEE'S 5 OFFER AND DID NOT INITIATE PENALTY U/S.271(L)(C) OF THE ACT. THE ASSESSEE IN THE SAME LETTER HAS VERY CLEARLY EXPLAI NED ITS FINANCIAL POSITION AND REQUESTED THE ASSESSING OFFICER TO GRA NT MONTHLY INSTALLMENTS. THE ASSESSEE HOWEVER, PROMISED TO PA Y THE MAXIMUM DEMAND BY 31.03.2012. THE ASSESSING OFFICER HAS NO T DISPOSED OFF THE ASSESSEE'S REQUEST FOR INSTALLMENTS. PURSUANT TO LEVY OF PENALTY U/S.221 ON 20.02.2012 THE ASSESSING OFFICER VIDE OR DER SHEET DATED 29.02.2012 HAD VACATED THE ATTACHMENT PLACED BY THE DEPARTMENT ON ASSESSEE'S CANAL DIV. KHARGAON ACCOUNT SUBJECT T O DEDUCTION OF RS.1 CRORE. THE ASSESSING OFFICER ALSO DIRECTED TH AT THE ASSESSEE COMPANY WOULD PAY RS.54 LAC ON OR BEFORE 25.03.2012 AND THE BALANCE PAYMENT ALONG WITH INTEREST U/S.220(2) BY 3 0.06.2012. IN THE SAID NOTE IT WAS MADE CLEAR TO THE ASSESSEE THA T IN CASE OF NON- COMPLIANCE, COERCIVE MEASURES FOR RECOVERY WOULD BE TAKEN AND ABOVE REFERRED INSTALLMENT SCHEME WOULD STAND CANCE LLED. THIS ARRANGEMENT WAS MADE AFTER THE ASSESSING OFFICER HA D LEVIED PENALTY U/S.221 OF THE ACT ON 20.02.2012. THE ASSESSEE HAS MADE THE PAYMENTS AS PER DETAILS GIVEN BELOW: 01/03/2012 RS. 1,00,00,000/- 29/03/2012 RS. 10,00,000/- 30/03/2012 RS. 30,00,000/- 31/03/2012 RS. 10,00,000/- 20/07/2012 RS. 92,47,870/- (ADJUSTED OUT OF REF UND FOR AY 11-12) 20/07/2012 RS. 60,61,970/- ( - DO-) (PENALTY U/S.221 20/07/2012 RS. 16,72,870/- (-DO-) [PENALTY U/S.271(1)(C)] FROM THE ABOVE, IT IS CLEAR THAT THE ASSESSEE HAD P AID RS.1,50,00,000/- BY 31/03/2012 OUT OF THE TOTAL DIS PUTED DEMAND OF RS.2,42,47,870/- AS PER ITS PROMISE MADE VIDE LE TTER DATED 02.12.2011 (FURTHER IN THE APPEAL AGAINST THE ASSES SMENT ORDER FOR AY. 2009-10, A RELIEF OF RS.49,21,734/- HAS BEEN GR ANTED BY THE 6 CIT(A) IN ITS ORDER DATED 08.10.2012). TAKING INTO CONSIDERATION THE ASSESSEE'S LETTER DATED 02.12.2011 WHEREIN IT HAS B EEN REQUESTED FOR MONTHLY INSTALLMENTS IN VIEW OF ITS POOR FINANCIAL POSITION AND THE FACTS AND CIRCUMSTANCES AS MENTIONED ABOVE, THE CIT (A) HAS OBSERVED THAT THE ASSESSING OFFICER HAD SHOWN UNDUE HASTE IN LEVYING PENALTY U/S.221 OF THE IT ACT WITHOUT EVEN DISPOSAL OF ASSESSEE'S REQUEST FOR MONTHLY INSTALLMENTS AS DISC USSED ABOVE. THE ASSESSEE IN ITS LETTER DATED 02.12.2011 HAD ALREADY MADE ITS FINANCIAL POSITION CLEAR BEFORE THE ASSESSING OFFIC ER. THE OFFER OF INCOME @14% OF TOTAL CONTRACT RECEIPTS WAS LINKED T O PAYMENT OF DEMAND IN MONTHLY INSTALLMENTS. IN CASE THE ASSESSE E WAS NOT READY TO GRANT MONTHLY INSTALLMENTS, HE SHOULD NOT HAVE A CCEPTED THE ASSESSEE'S OFFER IN THE FIRST PLACE OR SHOULD HAVE MADE THINGS CLEAR TO THE ASSESSEE THAT ITS REQUEST WAS NOT ACCEPTABLE. T HE ASSESSING OFFICER HAS NOT REJECTED THE REQUEST OF THE ASSESSE E FOR MONTHLY INSTALLMENTS, BUT WHILE ACCEPTING ASSESSEE'S OFFER OF INCOME @14% OF CONTRACT RECEIPTS WITH NO PENAL ACTION U/S.271(L)(C ), ASSESSING OFFICER SHOULD HAVE CLEARLY SPELT OUT HIS POSITION ON ASSES SEE'S REQUEST FOR MONTHLY INSTALLMENTS OR PAYMENT OF MAXIMUM TAX BY 3 1.03.2012. IN THE MEANWHILE, THE ASSESSEE HAS PRODUCED VARIOUS DO CUMENTS TO ESTABLISH THAT ITS VARIOUS PROJECTS GOT DELAYED FOR THE REASONS BEYOND ITS CONTROL AND THE ASSESSEE WAS REALLY IN FINANCIA L CRISIS. HE HAS CLEARLY STATED THAT IT WAS HARD PRESSED BY THE STAT E DEPARTMENT TO COMPLETE CONSTRUCTION OF ITS PROJECT 'UPPER VEDA PR OJECT' DIST. KHARGONE (M.P.) BY 31.03.2012. THE ASSESSEE THEREFO RE, ENGAGED MORE LABOUR AT HIGHER RATES ON THE SAID PROJECT DUR ING JAN-MARCH 2012. ITS BANK ACCOUNTS WERE CLASSIFIED AS NPAS AND NO FRESH FINANCIAL ASSISTANCE WAS AVAILABLE TO IT BY THE NEW OR EXISTING BANKERS. DESPITE THIS THE ASSESSEE HAD MADE A PAYME NT OF RS.1.50 CRORE BY 31.03.2012. UNDER THESE CIRCUMSTANCES IT S HOWS THAT THE ASSESSEE WAS PREVENTED BY GOOD AND SUFFICIENT REASO NS FOR NOT MAKING PAYMENT OF THE DEMAND AS PER THE RELEVANT PR OVISIONS OF THE IT ACT. THE ASSESSEE HOWEVER, MADE A SUBSTANTIAL PA YMENT BY 7 31.03.2012 AS PROMISED BY IT AND ALSO ADHERED TO PA YMENT SCHEDULE FIXED BY THE ASSESSING OFFICER VIDE ORDER SHEET DAT ED 29.02.2012. UNDER THE FACTS AND CIRCUMSTANCES, THE ASSESSING OF FICER HAS NOT JUSTIFIED IN LEVYING PENALTY OF RS.60,61,970/- U/S. 221 OF I.T. ACT AND THE SAME HAS RIGHTLY BEEN DELETED BY CIT(A). THIS FACTUAL LEGAL FINDING NEEDS NO INTERFERENCE FROM OUR SIDE. ACCOR DINGLY, THE APPEAL FILED BY THE REVENUE IS DISMISSED. 4. CROSS OBJECTION NO.2/PN/2013 ARISING OUT OF ITA NO.2426/PN/2012 IS NOTHING BUT SUPPORTING THE ORDER OF CIT(A), WHICH GOES INFRUCTUOUS IN VIEW OF ABOVE OUR FINDING ON MERIT AS DISCUSSED IN PREVIOUS PARAS IN THE APPEAL OF REVENU E. 5. IN RESULT, THE REVENUES APPEAL AS WELL AS CROSS OBJECTION ARE DISMISSED. 6. IN ITA NO.2427/PN/2012, THE REVENUE RAISED THE F OLLOWING GROUNDS: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.9,55,677/- MADE ON ACCOUNT OF DISCREPANCIES IN RESPECT OF CREDITORS. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE CIT(A) HAS ERRED IN NOT CONSIDERING THE FACT THAT THE ASSE SSEE ITSELF AGREED FOR THIS ADDITION VIDE ITS LETTER DATED 08-1 1-2011 ON ACCOUNT OF DISCREPANCIES IN CREDITORS. 3. THE APPELLANT CRAVES LEAVE TO AMEND, ADD, ALTER THE ABOVE GROUNDS, IF FELT NECESSARY, LATER. 7. AT THE OUTSET OF HEARING, IT WAS POINTED OUT THA T THE REVENUES APPEAL IS NOT MAINTAINABLE IN VIEW OF THE FACT THAT THE TAX EFFECT IS BELOW PRESCRIBED LIMIT FOR FILING THE APPEAL BEFORE THE TRIBUNAL. WE FIND THIS IN ITA NO.405/PN/2012 IN THE CASE OF SHIR IN ANANT BAGADE, WHEREIN, IT WAS HELD AS UNDER: 4. IN THE LIGHT OF THE RECENT GUIDELINES OF CBDT T HAT APPEAL IN THOSE CASES WHERE THE TAX EFFECT IS LESS THAN RS .10 LAKHS ARE 8 NOT TO BE ENTERTAINED, THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. DELHI RACE CLUB LTD. DISMISSED THE APPEA L PREFERRED BY THE REVENUE HAVING TAX EFFECT BELOW RS. 10 LAKHS . THE HONBLE DELHI HIGH COURT FOLLOWING ITS EARLIER DECI SION IN THE CASE OF CIT V/S. M/S. P.S. JAIN & CO. (ITA NO. 179/ 1991 DECIDED ON 2 ND AUGUST 2010) HAS BEEN PLEASED TO HOLD THAT SUCH CIRCULAR WOULD ALSO APPLY TO PENDING CASES. H ONBLE DELHI HIGH COURT IN THE CASE OF CIT V/S. M/S. P.S. JAIN & CO. (SUPRA) HAS BEEN PLEASED TO DISMISS THE REFERENCE APPLICATI ON HAVING TAX EFFECT OF RS.1,80,000/- FOLLOWING THE DECISION OF HONBLE BOMBAY HIGH COURT IN THE CASE OF CIT V/S. PITHWA EN GINEERING WORKS (2005), 276 ITR 519 (BOM) AND HONBLE M.P. HI GH COURT IN THE CASE OF CIT V/S. ASHOKKUMAR MANIBHAI PATEL & CO., 317 ITR 386 (M.P.). 5. WE FIND THE HONBLE BOMBAY HIGH COURT IN THE CAS E OF CIT V/S. PITHWA ENGINEERING WORKS (SUPRA) IN PARA NO.6, HAS EXPRESSED FOLLOWING VIEW AT PAGE NO. 520 : THIS COURT CAN VERY WELL TAKE JUDICIAL NOTICE OF T HE FACT THAT BY PASSAGE OF TIME MONEY VALUE HAS GONE DOWN, THE COST OF LITIGATION EXPENSES HAS GONE UP, THE ASSESS ES ON THE FILE OF THE DEPARTMENTS HAVE BEEN INCREASED CONSEQU ENTLY, THE BURDEN ON THE DEPARTMENT HAS ALSO INCREASED TO A TREMENDOUS EXTENT. THE CORRIDORS OF THE SUPERIOR C OURTS ARE CHOCKED WITH HUGE PENDENCY OF CASES. IN THIS VIEW O F THE MATTE, THE BOARD HAS RIGHTLY TAKEN A DECISION NOT T O FILE REFERENCES IF THE TAX EFFECT LESS THAN RS.2 LAKHS. THE SAME POLICY FOR OLD MATTERS NEED TO BE ADOPTED BY THE DEPARTMENT. IN OUR VIEW, THE BOARDS CIRCULAR DATED MARCH 27, 2000 IS VERY MUCH APPLICABLE EVEN TO THE OLD RE FERENCES WHICH ARE STILL UNDECIDED. THE DEPARTMENT IS NOT JU STIFIED IN PROCEEDING WITH THE OLD REFERENCES WHEREIN THE TAX IMPACT IS MINIMAL. THUS, THERE IS NO JUSTIFICATION TO PROC EED WITH DECADES OLD REFERENCES HAVING NEGLIGIBLE TAX EFFECT . IN VIEW OF THESE DECISIONS, INCLUDING DECISION OF H ONBLE JURISDICTIONAL HIGH COURT, WE COME TO THE CONCLUSIO N THAT CBDT GUIDELINES FOR THE REVENUE NOT TO PREFER APPEAL AGA INST FIRST APPELLATE ORDER BEFORE THE TRIBUNAL HAVING TAX EFFE CT UPTO RS. 3 LAKHS IS VERY MUCH APPLICABLE EVEN IN PENDING APPEA LS. IN THE CASE OF CIT V/S. MADHUKAR K. INAMDAR (HUF) (SUPRA), THE HONBLE JURISDICTIONAL HIGH COURT HAS BEEN PLEASED TO HOLD AGAIN THAT CBDT CIRCULAR DT.15 TH MAY 2008 WOULD BE VERY MUCH APPLICABLE TO THE PENDING CASES REQUIRING DEPA RTMENT TO WITHDRAW THE CASES WHEREIN TAX EFFECT IS LESS THAN THE PRESCRIBED MONETARY LIMITS. THE HONBLE HIGH COURT HAS BEEN FURTHER PLEASED TO HOLD THAT EVEN IF THE QUESTION O F LAW IS OF 9 RECURRING NATURE, EVEN THEN THE REVENUE IS NOT EXPE CTED TO FILE APPEALS IN SUCH CASES, IF THE TAX EFFECT IS LESS TH AN THE MONETARY LIMIT FIXED BY THE CBDT. 6. RESPECTFULLY FOLLOWING THESE DECISIONS INCLUDING DECISIONS OF HONBLE BOMBAY HIGH COURT CITED (SUPRA) HAVING B INDING EFFECT ON THE TRIBUNAL, WE HOLD THAT THIS APPEAL HA VING MONETARY IMPACT BELOW RS.3 LAKHS IS NOT MAINTAINA BLE AS THE APPEAL PREFERRED BY THE REVENUE IS IN VIOLATION OF THE ABOVE STATED GUIDELINES OF THE CBDT. ACCORDINGLY, WE DIS MISS THE APPEAL FILED BY THE REVENUE. 7.1 IN VIEW OF ABOVE LEGAL DECISIONS, WE FIND THAT THE APPEAL HAS BEEN FILED BY THE REVENUE BEFORE US IS LESS THAN TH E PRESCRIBED LIMIT FOR FILING THE APPEAL ON BEHALF OF REVENUE BEFORE T HE TRIBUNAL. NOTHING CONTRARY HAS BROUGHT TO OUR KNOWLEDGE. SIN CE IT IS BELOW THE PRESCRIBED LIMIT FOR FILING AN APPEAL BEFORE TR IBUNAL, THE APPEAL OF REVENUE IS DISMISSED. SINCE WE ARE DISMISSING THE APPEAL OF REVENUE ON THE PRELIMINARY ISSUE OF TAX EFFECT, WE ARE REFR AINING FROM COMMENTING ON THE MERIT OF THE ISSUE AT HAND. THE CROSS OBJECTIONS ARISING OUT OF THE SAME WHICH IS NOTHING BUT THE SU PPORTING THE ORDER OF CIT(A) AND THE SAME GOES INFRUCTUOUS IN VI EW OF OUR ABOVE FINDING, WHEREBY WE HAVE DISMISSED THE APPEAL OF TH E REVENUE FOR THE REASONS STATED ABOVE. 8. IN RESULT, THE REVENUES APPEAL AS WELL AS CROSS OBJECTION FILED BY THE ASSESSEE ARE DISMISSED. 9. IN THE RESULT, BOTH THE REVENUES APPEALS AS WEL L AS CROSS OBJECTIONS ARE DISMISSED AS INDICATED ABOVE. PRONOUNCED IN THE OPEN COURT ON THIS THE 15 TH DAY OF JANUARY, 2014. SD/- SD/- (R.K. PANDA) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER PUNE, DATED: 15 TH JANUARY, 2014 GCVSR 10 COPY TO:- 1. DEPARTMENT 2. ASSESSEE 3. THE CIT(A)-II, NASHIK 4. THE CIT-II, NASHIK 5. THE DR, B BENCH, I.T.A.T., PUNE. 6. GUARD FILE BY ORDER //TRUE COPY// SENIOR PRIVATE SECRETARY, I.T.A.T., PUNE