ITO, New Delhi V. M/s. Charanpaaduka Ind. (P) Ltd., New Delhi

ITA 2786/DEL/2014

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 97598 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 5 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-10-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC 2
• Next Hearing Date: 28-10-2015
• Assessment Year: 2004-2005
• Appeal Filed On: 05-05-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P DAM KANUNJNA
• Keywords: Unexplained cash credit; Tax effect
• Section: 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH SMC-2, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER ITA NO. 2786/DEL/2014 ASSESSMENT YEAR: 2004-05 INCOME TAX OFFICER, VS. M/S CHARANPAADUK A IND. (P) LTD. WARD 3(3), NEW DELHI 11/371, FIRST FLOOR, SUNDAR VIHAR PASCHIM VIHAR, NEW DELHI ( PAN: AABCC5193J) (APPELLANT) (RESPONDENT) APPELLANT BY : SH. P. DAM KANUNJNA, SR . DR RESPONDENT BY : SH. SANDEEP SAPRA, ADV. DATE OF HEARING DATE OF HEARING DATE OF HEARING DATE OF HEARING : : : : 2 22 28 88 8- -- -10 1010 10- -- -2015 2015 2015 2015 DATE OF ORDER DATE OF ORDER DATE OF ORDER DATE OF ORDER : :: : 2 22 28 88 8- -- -10 1010 10- -- -2015 2015 2015 2015 ORDER THIS APPEAL BY THE DEPARTMENT IS DIRECTED AGAINST THE ORDER DATED 26/2/2013 OF LD. CIT(A)-VIII, NEW DELHI. 2. THE GROUNDS RAISED IN THE APPEAL OF THE DEPARTME NT READ AS UNDER: THE ITO, WARD 3(3), NEW DELHI IS HEREBY DIRECTED TO FILE APPEAL IN THE ABOVE MENTIONED CASE BEFORE THE ITAT, NEW DELHI ON THE FOLLOWING GROUND OF APPEAL. 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS. 10 ,00,000/- MADE ON ACCOUNT OF UNEXPLAINED CREDIT U/S. 68 OF TH E I.T. ACT, 1961 THOUGH ASSESSEE COULD NEITHER PRODUCE THE KEY PERSON MANAGING FINANCIAL AFFAIR OF MONEY LENDER CO . NOR RETURNS FILED BY THE ABOVE SAID SHARE APPLICANT COU LD PROVE INCOME AND THUS ASSESSEE FAILED TO DISCHARGE ITS O NUS. 2. THE APPELLANT CRAVES LEAVE FOR RESERVING THE RIGH T TO AMEND, MODIFY, ALTER, ADD OR FOREGO ANY GROUND(S) OF APPEA L AT ANY TIME BEFORE OR DURING THE HEARING OF THIS APPEAL. 3. AT THE THRESHOLD, MR. SANDEEP SAPRA, LD. COUNSE L FOR THE ASSESSEE STATED THAT TAX EFFECT IN THIS APPEAL IS LESS THAN RS. 4,00,000/-, THEREFORE, ITA NO. 2786/DEL/2014 (ITO V M/S CHARANPAADUKA IND L. (P) LTD ) 2 THE DEPARTMENT OUGHT NOT TO HAVE FILED THIS APPE AL IN VIEW OF THE CIRCULAR ISSUED BY THE CBDT AND THE PROVISIONS CONTAINED IN THE SECTION 268A OF THE INCOME TAX ACT, 1961 (HEREINAFTER TO BE REFERRE D AS THE ACT). 4. ON THE OTHER HAND, LD. DR RELIED UPON THE ORDER OF THE AO. 5. AFTER HEARING BOTH THE PARTIES, IT IS NOTICED TH AT SECTION 268A HAS BEEN INSERTED BY THE FINANCE ACT, 2008 WITH RETROSPECTIV E EFFECT FROM 01/04/1999. THE RELEVANT PROVISIONS CONTAINED IN S ECTION 268A READ AS UNDER: 268A. (1) THE BOARD MAY, FROM TIME TO TIME, ISSU E ORDERS, INSTRUCTIONS OR DIRECTIONS TO OTHER INCOME-TAX AUTH ORITIES, FIXING SUCH MONETARY LIMITS AS IT MAY DEEM FIT, FOR THE PURPOSE OF REGULATING FILING OF APPEAL OR APPLICATION FOR REFERENCE BY ANY INCOM E-TAX AUTHORITY UNDER THE PROVISIONS OF THIS CHAPTER. (2) WHERE, IN PURSUANCE OF THE ORDERS, INSTRUCTION S OR DIRECTIONS ISSUED UNDER SUB-SECTION (1), AN INCOME-TAX AUTHORI TY 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 PREC LUDE SUCH AUTHORITY FROM FILING AN APPEAL OR APPLICATION FOR REFERENCE ON THE SAME ISSUE IN THE CASE OF (A) THE SAME ASSESSEE FOR ANY OTHER ASSESSMENT YEA R; OR (B) ANY OTHER ASSESSEE FOR THE SAME OR ANY OTHER AS SESSMENT YEAR; (3) NOTWITHSTANDING THAT NO APPEAL OR APPLICATION FOR REFERENCE HAS BEEN FILED BY AN INCOME-TAX AUTHORITY PURSUANT TO T HE 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 ACQUIESCE D IN THE DECISION ON THE DISPUTED ISSUE BY NOT FILING AN APPEAL OR AP PLICATION FOR REFERENCE IN ANY CASE. (4) THE APPELLATE TRIBUNAL OR COURT, HEARING SUCH APPEAL OR REFERENCE, SHALL HAVE REGARD TO THE ORDERS, INSTRUC TIONS OR DIRECTIONS ISSUED UNDER SUB-SECTION (1) AND THE CIRCUMSTANCES UNDER WHICH SUCH APPEAL OR APPLICATION FOR REFERENCE WAS FILED OR NO T FILED IN RESPECT OF ANY CASE. (5) EVERY ORDER, INSTRUCTION OR DIRECTION WHICH H AS BEEN ISSUED BY THE BOARD FIXING MONETARY LIMITS FOR FILING AN APPE AL OR APPLICATION FOR REFERENCE SHALL BE DEEMED TO HAVE BEEN ISSUED U NDER SUB-SECTION (1) AND THE PROVISIONS OF SUB-SECTIONS (2), (3) AND (4) SHALL APPLY ACCORDINGLY. ITA NO. 2786/DEL/2014 (ITO V M/S CHARANPAADUKA IND L. (P) LTD ) 3 6. IT IS NOT IN DISPUTE THAT THE BOARDS INSTRUCTIO N OR DIRECTIONS ISSUED TO THE OTHER INCOME-TAX AUTHORITIES ARE BINDING ON THO SE AUTHORITIES, THEREFORE, THE DEPARTMENT OUGHT NOT TO HAVE FILED THE APPEAL I N 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. 7. IT IS NOTICED THAT THE CBDT HAS ISSUED INSTRUCTI ON NO. 5/2014 DATED 10 TH JULY, 2014, BY WHICH THE CBDT HAS REVISED THE MONE TARY LIMIT TO RS. 4,00,000/- FOR FILING THE APPEAL BEFORE THE TRI BUNAL. 8. KEEPING IN VIEW THE CBDT INSTRUCTION NO. 5 OF 20 14 DATED 10 TH JULY, 2014 AND ALSO THE PROVISIONS OF SECTION 268A OF INC OME TAX ACT, 1961, I AM OF THE VIEW THAT THE REVENUE SHOULD NOT HAVE FIL ED THE INSTANT APPEAL BEFORE THE TRIBUNAL. WHILE TAKING SUCH A VIEW, I FORTIFY BY THE FOLLOWING DECISIONS OF THE HONBLE PUNJAB & HARYANA HIGH COUR T: 1. CIT VS. OSCAR LABORATORIES P. LTD. (2010) 324 ITR 1 15 (P&H); 2. CIT VS. ABINASH GUPTA (2010) 327 ITR 619 (P&H); 3. CIT VS. VARINDERA CONSTRUCTION CO. (2011) 331 ITR 4 49 (P&H) (FB). 9. SIMILARLY, THE HONBLE DELHI HIGH COURT IN THE C ASE 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. 179/1 991 IN THE CASE OF CIT DELHI-III VS. M/S P.S. JAIN & CO. HELD THAT SUCH CI RCULAR WOULD ALSO BE APPLICABLE TO PENDING CASES. 10. THUS, FROM THE RATIO LAID DOWN BY THE HONBL DE LHI HIGH COURT, IT IS CLEAR THAT THE INSTRUCTIONS ISSUED IN THE CIRCULARS BY CBDT ARE APPLICABLE FOR PENDING CASES ALSO. THEREFORE, BY KEEPING IN VIEW THE RATIO LAID DOWN IN THE AFORESAID REFERRED TO CASE, I AM OF THE CONSIDE RED VIEW THAT INSTRUCTION NO. 5 OF 2014 DATED 10 TH JULY, 2014 ISSUED BY THE CBDT ARE APPLICABLE FOR ITA NO. 2786/DEL/2014 (ITO V M/S CHARANPAADUKA IND L. (P) LTD ) 4 THE PENDING CASES ALSO AND IN THE SAID INSTRUCTIONS , MONETARY TAX LIMIT FOR NOT FILING THE APPEAL BEFORE THE ITAT IS RS. 4,00,0 00/-. 11. IN VIEW OF THE ABOVE, WITHOUT GOING INTO MERIT OF THE CASE, I DISMISS THE APPEAL FILED BY THE REVENUE. 12. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 28/10/2015. SD/- (H.S. SIDHU) JUDICIAL MEMBER DATED: 28/10/2015 *SR BHATNAGAR* COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR ITA NO. 2786/DEL/2014 (ITO V M/S CHARANPAADUKA IND L. (P) LTD ) 5