ITO, Baghpat V. M/s Shree Adinath Agro Industries, Baghpat

ITA 2861/DEL/2010

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 7484 (ITAT-DELHI)
• Duration Of Justice: 2 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-08-2010
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2006-2007
• Appeal Filed On: 09-06-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R P SINGH SENIOR
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH G : NEW DELHI) BEFORE SHRI I.P. BANSAL, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER ITA NO.2861/DEL./2010 (ASSESSMENT YEAR : 2006-07) INCOME TAX OFFICER, VS. M/S. SHREE ADINATH AGRO IN DUSTRIES, BARAUT. PATHSHALA ROAD, KHEKRA (BAGHPAT). (PAN : AAKHS1563A) (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE REVENUE BY : SHRI R.P. SINGH, SENIOR DR ORDER PER B.C. MEENA, ACCOUNTANT MEMBER : THE REVENUE HAS FILED THIS APPEAL AGAINST THE ORDER OF CIT (APPEALS), MEERUT DATED 23.3.2010 FOR THE ASSESSMENT YEAR 2006 -07. THE REVENUE HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL :- 1. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN L AW AND ON THE FACTS IN REDUCING THE NET RATE OF PROFIT FRO M 5% TO 2% BY ALLOWING RELIEF TO THE ASSESSEE INSPITE OF CLEAR CU T FINDING THAT A.O. WAS LEFT WITH NO OTHER OPTION BUT TO DETERMINE THE TAXABLE INCOME BY APPLICATION OF NET RATE ON ESTIMATED SALE S AS PER PROVISIONS OF SEC.145(3) OF I.T. ACT. 2. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN L AW AND ON THE FACTS IN REDUCING THE NET RATE OF PROFIT FRO M 5% TO 2% ITA NO.2861/DEL./2010 2 WITHOUT ANY BASIS AND WITHOUT ANY MATERIAL ON RECOR D TO SUGGEST SUCH DRASTIC REDUCTION OF N.P. RATE. 3. IN THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS) MAY BE SET ASI DE AND THAT OF THE A.O. BE RESTORED. 2. AT THE TIME OF HEARING, LEARNED DR FAIRLY CONCED ES THAT THE TAX EFFECT IS BELOW RS.2 LACS. THE CBDT VIDE INSTRUCTION NO. 2 D ATED 24.10.2005 HAS INCREASED THE MONETARY LIMIT FROM RS.1 LAC TO RS.2 LAC FOR THE PURPOSE OF INSTRUCTION GIVEN TO THE INCOME TAX AUTHORITIES FOR FILING THE APPEAL BEFORE THE TRIBUNAL. IT IS NOW WELL SETTLED THAT THE BOAR D INSTRUCTIONS ARE OF BINDING NATURE ON THE INCOME TAX AUTHORITIES AND, THEREFORE , THE INCOME TAX AUTHORITIES SHOULD NOT HAVE FILED THE PRESENT APPEA L BEFORE THE TRIBUNAL INASMUCH AS THE TAX EFFECT ON THE AMOUNTS DISPUTED IN THE PRESENT APPEAL IS BELOW RS.2 LACS. 3. THE HON'BLE DELHI HIGH COURT IN THE CASE OF MANI SH BHAMBRI (ITA NO.683/2007, ORDER BEING DATED 1.8.2007) HAS ALSO U PHELD DISMISSAL OF APPEAL BY THE TRIBUNAL WHERE SUCH APPEAL WAS FILED IN VIOL ATION OF THE CBDT INSTRUCTION REGARDING TAX EFFECT FOR FILING APPEAL BEFORE THE TRIBUNAL. 4. IN VIEW OF THE ABOVE DECISION AND KEEPING IN VIE W THAT THE TAX EFFECT IN THE PRESENT APPEAL IS LESS THAN THE PRESCRIBED LIMI T OF RS.2 LAKHS, WE ARE INCLINED TO DISMISS THE APPEAL OF THE REVENUE. 5. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON THIS 10 TH DAY OF AUGUST, 2010. SD/- SD/- (I.P. BANSAL) (B.C. MEENA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 10 TH DAY OF AUGUST, 2010/TS ITA NO.2861/DEL./2010 3 COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A), MEERUT. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.