ACIT, New Delhi V. Sh. Deepak Wadhawan, New Delhi

ITA 2858/DEL/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3616 (ITAT-DELHI)
• Duration Of Justice: 1 year(s) 1 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 11-07-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 11-07-2011
• Assessment Year: 2005-2006
• Appeal Filed On: 08-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SALIL MISHRA
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH B : NEW DELHI) BEFORE SHRI A.D. JAIN, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER ITA NO.2858/DEL./2010 (ASSESSMENT YEAR : 2005-06) ACIT, CIRCLE 46(1), VS. DEEPAK WADHAWAN, NEW DELHI. BG-7/93, PASCHIM VIHAR, NEW DELHI. (PAN/GIR NO.AAKPW3620L) (APPELLANT) RESPONDENT) ASSESSEE BY : SHRI HARDIPENDER SINGH/MS. GAYATRI SHARMA, ADV. REVENUE BY : SHRI SALIL MISHRA, SR.DR ORDER PER A.D.JAIN: JM THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE O RDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-XXX, NEW DELH I, DATED 26.03.2010 PERTAINING TO ASSESSMENT YEAR 2005-06. 2. THE MAIN ISSUE RAISED IS THAT LD. COMMISSIONER OF INCO ME TAX (APPEALS) HAS ERRED IN CANCELING THE PENALTY AMOUNTIN G TO `2,89,125/- RIGHTLY IMPOSED BY THE ASSESSING OFFICER FOR CONCEALING THE PARTICULARS OF INCOME FROM CAPITAL GAIN AND INTEREST INCOME. 3. AT THE THRESHOLD, WE NOTE THAT THE TAX EFFECT IN THIS APPEAL IS LESS THAN ` 3 LAKHS. AS PER INSTRUCTION NO. 3/2011 (F.NO. 279/MISC./142/2007-ITJ) DATED 09.02.2011 ISSUED BY THE CBDT, THE TAX EFFECT FOR FILING APPEAL BEFORE THE APPELLATE TRIBU NAL SHOULD BE MORE THAN ` 3 LAKHS. IN THE PRESENT CASE, ADMITTEDLY THE T AX IS BELOW ` 3 LAKHS. HENCE, THE APPEAL IS IN CONTRAVENTION OF T HE AFORESAID CBDT CIRCULAR/INSTRUCTION. HENCE, THE SAME IS LIABLE TO BE DISMISSED. ACCORDINGLY, THIS APPEAL BY THE REVENUE STANDS DISMISSED FOR TAX EFFECT. 4. MOREOVER, THE CASE IS ALSO COVERED BY THE DECISION OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT, DELHI- III VS. M/S P.S. JAIN AND CO., BEING I.T.A. NO.179/1991 DATED 2.8.2010, I N WHICH THE HONBLE HIGH COURT OBSERVED THAT: IN CIT VS. ASHOK KUMAR MANIBHA PATEL AND CO.(2009) 31 7 ITR 386 (MP), A DIVISION BENCH OF MADHYA PRADESH HAS HELD AS TH US: 13. QUITE APART FROM THE ABOVE, WE MAY ALSO NOTE THA T THIS COURT IN THE CASE OF CWT VS. DR. AJAD KUMAR JAIN( HUF), SAGAR (W.P. NO.162/98), WHILE TAKING NOTE OF THE TA X IMPACT AND PLACING RELIANCE ON THE DECISION RENDERED IN CIT V. PITHWA ENGINEERING WORKS (2005) 276 ITR 519 (BOM.), HAS OPINED THUS: 11. THE FACTUAL SCENARIO CAN BE PERCEIVED FROM ANOTHER ASPECT. SUBMISSION OF MR. A.K. SHRIVASTAVA, LEARNED COUNSEL FOR THE RESPONDENT IS THAT THE TAX IMPACT IS `52,565/- AND, THEREFORE, AS PER THE CIRCUL AR OF THE CENTRAL BOARD OF DIRECT TAXES THE REFERENCE NEED NOT BE ADVERTED TO. A DIVISION BENCH OF THE HIGH COURT OF BOMBAY IN THE CASE OF CIT VS. PITHWA ENGG. WORKS (2005) 276 ITR 519 (BOM.), IN PARAGRAPH 6 EXPRESSED THE VIEW AS UNDER (PAGE 520): THIS COURT CAN VERY WELL TAKE JUDICIAL NOTICE OF TH E FACT THAT BY PASSAGE OF TIME MONEY VALUE HAS GONE DOWN, THE COST OF LITIGATION EXPENSES HAS GONE UP, THE ASSESSEES ON THE FILE OF THE DEPARTMENTS HAVE BEEN INCREASED CONSEQUENTLY, THE BURDEN ON THE DEPARTMENT HAS ALSO INCREASED TO A TREMENDOUS EXTENT. THE CORRIDORS OF THE SUPERIOR COURTS ARE CHOCKED WITH HUGE TENDENCY OF CASES. IN THIS VIEW OF THE MATTER, THE BOARD HAS RIGHTLY TAKEN A DECISION NOT TO FILE REFERENCES IF THE TAX EFFECT IS LESS THAN R S.2 LAKHS. THE SAME POLICY FOR OLD MATTERS NEED TO BE ADOPTED BY THE DEPARTMENT. IN OUR VIEW, THE BOARD S CIRCULAR DATED MARCH 27,2000 IS VERY MUCH APPLICABLE EVEN TO THE OLD REFERENCES WHICH ARE STILL UNDECIDED. THE DEPARTMENT IS NOT JUSTIFIED IN PROCEEDING WITH THE OLD REFERENCES WHEREIN THE TAX IMPACT IS MINIMAL. THUS, THERE IS NO JUSTIFICATION TO PROCEED WITH DECADES OLD REFERENCES HAVING NEGLIGIBLE TAX EFFECT. 3. JUDGED FROM BOTH ANGLES WOULD ANSWER THE REFERENCE IN THE NEGATIVE IN FAVOUR OF THE ASSESSEE AND AGAINST THE REVENUE. 4. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 11.07.2011. SD/- SD/- [SHAMIM YAHYA] [A.D.JAIN] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: JULY 11,2011 SKB COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A)-XXX, NEW DELHI. 5. CIT( ITAT) BY ORDER, DEPUTY REGISTRAR, ITAT, DELHI BENCHES