THE ITO, WARD - 2 (1), Vijayawada V. Sri Patteboina Maheswara Rao, Vijayawada

ITA 29/VIZ/2013

• Counselvise Citation: [2017] 127 COUNSELVISE.COM (IT) 8953 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 4 year(s) 3 month(s) 1 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-05-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2004-2005
• Appeal Filed On: 01-02-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M K SETHI
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL VISAKHAPATNAM SMC BENCH, VISAKHAPATNAM BEFORE SHRI D. MANMOHAN, HONBLE VICE-PRESIDENT ITA NO. 29/VIZ/2013 (ASST. YEAR : 2004-05) ITO, WARD-2(1), VIJAYAWADA. VS. PATTEBOINA MAHESWARA RAO, PROP. M/S. NAVABHARAT TIMBER DEPOT & SAW MILL, D.NO. 33-21-38, SEETHARAMPURAM, VIJAYAWADA. PAN NO. ADBPM 4097 K (APPELLANT) (RESPONDENT) ASSESSEE BY : NONE. DEPARTMENT BY : SHRI M.K. SETHI SR. DR DATE OF HEARING : 03/05/2017. DATE OF PRONOUNCEMENT : 03/05/2017. O R D E R THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER PASSED BY THE LD. CIT(A), VIJAYAWADA AND IT PERTAINS TO ASSESSMENT YEAR 2004-05. 2. WHEN THE CASE FIRST POSTED FOR HEARING, LEARNED COUNSEL FOR THE ASSESSEE FILED A WRITTEN SUBMISSION TO HIGHLIGHT THE FACTS AND SUBMITTED THAT THE TAX EFFECT IS BELOW 10 LAKHS AND, THEREFORE, THE REVENUE IS NOT ENTITLED TO FILE AN APPEAL IN THE LIGHT OF THE BOARD INSTRUCTIONS. THE CALCULATION OF TAX EFFECT IS AS UNDER:- 2 ITA NO. 29/VIZ/2013 (P. MAHESWARA RAO) THE APPELLANT SUBMITS THAT THE TAX EFFECT IS BELOW 10,00,000/- AND THE SAME IS WORKED OUT AS UNDER:- GROUNDS RAISED BY THE DEPARTMENT TAX EFFECT A) GROUND NOS. A & B NO TAX EFFECT B) GROUND NO.C IS AGAINST RELIEF GRANTED OF 14,29,953/- AGAINST LONG TERM CAPITAL GAIN AND TAX PAYABLE IS 20% 2,85,991 C) GROUND NO. D,E & F ARE WITH REGARD TO DELETION OF THE ADDITION OF 7,00,000/- MADE BY THE CIT (A). TAX PAYABLE AT 30% 2,10,000 D) GROUND NOS. G & H ARE WITH REGARD TO DELETION OF CASH DEPOSIT OF 5,00,000/-. TAX EFFECT IS 1,50,000/- TOTAL TAX EFFECT 6,45,991/- IT IS SUBMITTED THAT THE SURCHARGE AND EDUCATION CESS ARE NOT TO BE CONSIDERED AS TAX FOR THE PURPOSE OF WORKING 10 LAKHS. HOWEVER, EVEN IF SURCHARGE WERE TO BE ADDED, TAX EFFECT WILL BE LESS THAN 10 LAKHS. THE APPELLANT HUMBLY SUBMITS THAT THE HON'BLE ITAT, CHENNAI BENCH-A IN THE CASE OF ACIT VS. R. VISWANATHAN IN ITA NO. 30/MDS/2011 HELD THAT THE TAX DOES NOT INCLUDE SURCHARGE OR EDUCATION CESS. SIMILAR VIEW IS TAKEN BY THE HON'BLE ITAT BENCH-BUSINESS, HYDERABAD IN THE CASE OF ITO VS. P. PRASEN KUMAR IN ITA NO. 418/HYDERABAD/2014 WHEREIN IT IS HELD THAT SURCHARGE AND EDUCATION CESS SHOULD NOT BE INCLUDED WHILE CALCULATING THE TAX EFFECT. 3. THE AUTHORISATION OF THE COMMISSIONER OF INCOME TAX ISSUED UNDER SECTION 254(2) OF THE ACT IS GENERAL IN NATURE AND DOES NOT REFER TO THE GROUNDS WHICH ARE TO BE URGED BEFORE THE TRIBUNAL. 4. SINCE ASSESSEES REPRESENTATIVE SUBMITS THAT TAX EFFECT IS BELOW 10 LAKHS, THE LEARNED DEPARTMENTAL REPRESENTATIVE IS DIRECTED TO VERIFY RECORDS AND EXPLAIN AS TO WHETHER THE TAX EFFECT IS BELOW 10 LAKHS OR NOT THOUGH CASE WAS ADJOURNED ON SEVERAL OCCASIONS AND FINALLY POSTED FOR HEARING TODAY, THE LEARNED DEPARTMENTAL REPRESENTATIVE WAS UNABLE TO PLACE ANY MATERIAL TO CONTRADICT THE STATEMENT OF THE ASSESSEE. LEARNED DEPARTMENTAL REPRESENTATIVE ADMITTED THAT THE TAX EFFECT IS 3 ITA NO. 29/VIZ/2013 (P. MAHESWARA RAO) BELOW 10 LAKHS. UNDER THESE CIRCUMSTANCES, I HOLD THAT THE APPEAL DESERVES TO BE WITHDRAWN IN THE LIGHT OF THE CIRCULAR ISSUED BY THE CBDT AND ACCORDINGLY, THE APPEAL OF THE REVENUE IS DISMISSED. SD/- (D. MANMOHAN) VICE-PRESIDENT DATED : 03 RD MAY, 2017. VR/- COPY TO: 1. THE ASSESSEE PATTEBOINA MAHESWARA RAO, PROP. M/S.NAVABHARAT TIMBER DEPOT & SAW MILL, D.NO. 33-21-38, SEETHARAMPURAM, VIJAYAWADA. 2. THE REVENUE ITO, WARD-2(1), VIJAYAWADA. 3. THE CIT, VIJAYAWADA. 4. THE CIT(A),VIJAYAWADA. 5. THE D.R., VISAKHAPATNAM. 6. GUARD FILE. BY ORDER