ACIT, Meerut V. M/s Vats Pharma Pvt. Ltd., Meerut

ITA 2776/DEL/2013

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 6907 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 8 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Next Hearing Date: 03-02-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 07-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: V R SOANBHADRA
• Assessee Lawyers: RK GARG
• Keywords: Tax effect; Onus to prove

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH H, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER ITA NO. 2776/DEL/2013 ASSESSMENT YEAR: 2006-07 ACIT, CIRCLE-2 VS. M/S VATS PHARMA PVT. LTD. MEERUT 84/A, HILL STREET, MEERUT (PAN: AAACV7932P) (APPELLANT) (RESPONDENT) APPELLANT BY : SH. V.R. SOANBHADRA, SR . DR RESPONDENT BY : SH. R.K. GARG, ADV. DATE OF HEARING : 03-02-2016 DATE OF ORDER : 05-02-2016 ORDER PER H.S. SIDHU, J.M. THIS APPEAL BY THE DEPARTMENT IS DIRECTED AGAINST THE ORDER DATED 13.2.2013 OF LD. CIT(A)-MEERUT PERTAINING TO ASSESS MENT YEAR 2006-07 ON THE FOLLOWING GROUNDS:- (1) WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CFT (APPEALS) HAS ERRED IN LAW IN DIRECTING THE AO TO D ELETE THE ADDITION OF RS. 14,76,718/-MADE ULS 68 OF THE IT ACT, 1961 ON A /C OF ALLEGED UNSECURED LOANS AFTER VERIFYING THAT THE SAME EXIST ED IN THE BEGINNING OF THE PREVIOUS YEAR IGNORING THAT THE CASH CREDIT AT THE FIRST DAY OF ACCOUNTING YEAR ARE ALSO LIABLE TO BE ADDED ULS 68 OF THE I.T. ACT, I 96 I AND FURTHER WITHOUT APPRECIATING THE FACTS THAT THE ASSESSEE HAD FAILED TO PROVE THE GENUINENESS OF TRANSACTIONS AND CREDIT WORTHINESS OF THE LENDERS WITH RESPECT TO THE AMOUNTS ALLEGEDLY GIVEN AS THE LOANS. ONUS TO PROVE SUCH CREDITWORTHINESS WAS ENTIRELY UPON TH E ASSESSEE WHICH TOTALLY REMAINED UNDISCHARGED. RELIANCE IS PLACED O N THE FOLLOWING JUDGMENTS: ITA NO.2776/DEL/2013 2 I. BASANTIPUR TEA CO.(P) LTD. VS CIT 180 ITR 261(CA L) II. 'KRISHAN KUMAR JHANB VIS ITO AND ANR (PUNJAB & HARYANA) 17 DTR 249' III. MIS SEJAI INTERNATIONAL LTD VIS CIT MEERUT (AL L.) APPEAL NO.306 OF 2010. IV. CIT VS DURGA PRASAD MORE, 82 ITR 540(SC) V. CIT VS P. MOHNAKALA, 291 ITR 278 (SC) VI. CIT VS SUMATI DAYAL, 214, ITR 801 (SC) VII. ITO VS DIZA HOLDINGS PVT. LTD. 255 ITR 573 (KE RLA) VIII. VIII. CIT VIS KORLAY TRADING CO. LTD. (CAL.) 232 ITR 820. (2) THAT THE APPELLANT CRAVES LEAVE TO ADD, MODIFY ANDLOR DELETE ANY GROUND(S) OF APPEAL. (3) IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE ORDER OF THE COMMISSIONER OF INCOME-TAX (APPEALS) MAY BE SET ASI DE AND THAT OF THE A.O. RESTORED. 2. WE FIND THAT REVENUE IN THE GROUNDS OF APPEAL BE FORE THE TRIBUNAL HAS CHALLENGED THE DELETION OF ADDITION OF RS. 14,76,7 18/- VIDE GROUND NO. 1, AS AFORESAID. 3. FROM THE ABOVE, WE FIND THAT THE TAX EFFECT IN THE REVENUES APPEAL IS LESS THAN RS.10,00,000/-, THEREFORE, THE DEPARTMENTS AP PEAL IS NOT MAINTAINABLE, IN VIEW OF THE CIRCULAR NO. 21/2015 DATED 10 TH DECEMBER, 2015 ISSUED VIDE F.NO. 279/MISC. 142/2007-ITJ (PT.) BY THE CBDT. FO R THE SAKE OF CONVENIENCE, THE RELEVANT PARA NOS. 3 & 10 OF THE AFORESAID CBDT S CIRCULAR ARE REPRODUCED AS UNDER:- ITA NO.2776/DEL/2013 3 3. HENCEFORTH, APPEALS/ SLPS SHALL NOT BE FILED IN CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY L IMITS GIVEN HEREUNDER: S NO APPEALS IN INCOME-TAX MATTERS MONETARY LIMIT (IN RS) 1 BEFORE APPELLATE TRIBUNAL 10,00,000/- 2 BEFORE HIGH COURT 20,00,000/- 3 BEFORE SUPREME COURT 25,00,000/- IT IS CLARIFIED THAT AN APPEAL SHOULD NOT BE FILED MERELY BECAUSE THE TAX EFFECT IN A CASE EXCEEDS THE MONETA RY LIMITS PRESCRIBED ABOVE. FILING OF APPEAL IN SUCH CASES IS TO BE DECIDED ON MERITS OF THE CASE. 10. THIS INSTRUCTION WILL APPLY RETROSPECTIVELY TO PENDING APPEALS AND APPEALS TO BE FILED HENCEFORTH IN HIGH COURTS/ TRIBUNALS. PENDING APPEALS BELOW THE SPECIFIED TAX LIMITS IN PARA 3 ABOVE MAY BE WITHDRAWN/ NOT PRESSED. APPEALS BEFORE THE SUPREME COURT WILL BE GOVERNED BY THE INSTRUCTI ONS ON THIS SUBJECT, OPERATIVE AT THE TIME WHEN SUCH APPEA L WAS FILED. 4. IT IS NOT IN DISPUTE THAT THE BOARDS INSTRUCTIO N OR DIRECTIONS ISSUED TO THE INCOME-TAX AUTHORITIES ARE BINDING ON THOSE AUTHORI TIES, THEREFORE, THE DEPARTMENT SHOULD HAVE WITHDRAWN/ NOT PRESSED THE P RESENT APPEAL, IN VIEW OF THE AFORESAID INSTRUCTIONS SINCE THE TAX EFFECT IN THE INSTANT APPEAL IS LESS THAN THE AMOUNT OF RS. 10 LACS, PRESCRIBED IN THE ABOVE SAID CBDTS INSTRUCTIONS. 5. KEEPING IN VIEW THE CBDT INSTRUCTION NO. 21/2015 DATED 10 TH DECEMBER, 2015, WE ARE OF THE VIEW THAT THE REVENUE SHOULD HA VE WITHDRAWN/ NOT PRESSED THE INSTANT APPEAL BEFORE THE TRIBUNAL. WE ARE ALS O OF THE VIEW THAT THE SAID ITA NO.2776/DEL/2013 4 INSTRUCTIONS ARE APPLICABLE FOR THE PENDING APPEALS AND APPEALS TO BE FILED HENCEFORTH IN TRIBUNAL. ACCORDINGLY, THE REVENUES APPEAL IS DISMISSED. 6. IN THE RESULT, APPEAL FILED BY THE REVENUE STAN DS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 05/02/2016. SD/- SD/- (L.P. SAHU) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIA L MEMBER DATED: 05/02/2016 *SR BHATNAGAR* COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR