DCIT Intl. Taxation, Dehradun V. M/s Offshore Hyundai International Ltd.,

ITA 2935/DEL/2009

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 6273 (ITAT-DELHI)
• Duration Of Justice: 6 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-03-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 17-03-2016
• Assessment Year: 1995-1996
• Appeal Filed On: 18-06-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P DAM KANUNJNA SENIOR
• Assessee Lawyers: O P SAPRA
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL IN THE INCOME TAX APPELLATE TRIBUNAL DELHI DELHI DELHI DELHI BENCH BENCH BENCH BENCH E EE E : NEW DELHI : NEW DELHI : NEW DELHI : NEW DELHI BEFORE SHRI BEFORE SHRI BEFORE SHRI BEFORE SHRI G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT G.D. AGRAWAL, VICE PRESIDENT AND AND AND AND SMT. BEENA A. PILLAI SMT. BEENA A. PILLAI SMT. BEENA A. PILLAI SMT. BEENA A. PILLAI, JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER , JUDICIAL MEMBER ITA NO ITA NO ITA NO ITA NO . .. . 2935/DEL/2009 2935/DEL/2009 2935/DEL/2009 2935/DEL/2009 ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : ASSESSMENT YEAR : 1995 1995 1995 1995 - -- - 96 9696 96 DEPUTY DIRECTOR OF INCOME DEPUTY DIRECTOR OF INCOME DEPUTY DIRECTOR OF INCOME DEPUTY DIRECTOR OF INCOME TAX, TAX, TAX, TAX, INTERNATIONAL TAXATION INTERNATIONAL TAXATION INTERNATIONAL TAXATION INTERNATIONAL TAXATION, ,, , DEHRADUN. DEHRADUN. DEHRADUN. DEHRADUN. VS. VS. VS. VS. M/S OFFSHORE HYUNDAI INTERNATIONAL M/S OFFSHORE HYUNDAI INTERNATIONAL M/S OFFSHORE HYUNDAI INTERNATIONAL M/S OFFSHORE HYUNDAI INTERNATIONAL LIMITED, LIMITED, LIMITED, LIMITED, C/O HEMANT ARORA & CO., CAS, C/O HEMANT ARORA & CO., CAS, C/O HEMANT ARORA & CO., CAS, C/O HEMANT ARORA & CO., CAS, 1 11 1- -- - TYAGI ROAD, TYAGI ROAD, TYAGI ROAD, TYAGI ROAD, DEHRADUN DEHRADUN DEHRADUN DEHRADUN 248 001. 248 001. 248 001. 248 001. (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI P. DAM KANUNJNA, SENIOR DR. RESPONDENT BY : SHRI O.P. SAPRA , ADVOCATE . DATE OF HEARING : 17 1717 17.03.2016 .03.2016 .03.2016 .03.2016 DATE OF PRONOUNCEMENT : 29.03.2016 29.03.2016 29.03.2016 29.03.2016 ORDER ORDER ORDER ORDER PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP PER G.D. AGRAWAL, VP : :: :- -- - THIS APPEAL BY THE REVENUE FOR THE ASSESSMENT YEAR 2009-10 IS DIRECTED AGAINST THE ORDER OF LEARNED CIT(A)-XII, N EW DELHI DATED 3 RD DECEMBER, 2013. 2. THE GROUNDS RAISED BY THE REVENUE READ AS UNDER: - 1. ON THE FACTS AND IN CIRCUMSTANCES OF THE CASE, LD.CIT(A)-II, DEHRADUN WAS NOT CORRECT IN LAW AND O N FACTS, IN ALLOWING THE RELIEF FOR REVENUES, EARNED OUTSIDE INDIA, DESPITE HIS UPHOLDING TO ASSESS THE ASSESSEE U/S 44 BB(1) OF IT ACT, 1961. 2. THE ORDER OF CIT(A)-II, DEHRADUN BE SET ASIDE AN D THAT OF THE AO BE RESTORED. 3. IT IS OBSERVED THAT THE TOTAL ADDITION MADE BY T HE ASSESSING OFFICER ON ACCOUNT OF OUTSIDE ACTIVITIES IS ONLY `1 6,18,907/-. THEREFORE, THE TAX EFFECT INVOLVED IN THIS APPEAL BY THE REVEN UE IS BELOW `10 ITA-2935/DEL/2009 2 LAKHS. THE CBDT IN ITS CIRCULAR NO.21/2015 DATED 1 0 TH DECEMBER, 2015 HAS REVISED THE MONETARY LIMIT FOR FILING OF THE DE PARTMENTAL APPEALS TO THE ITAT AT `10 LAKHS WHICH IS EVIDENT FROM PARAGRA PH 3 OF THE CIRCULAR, WHICH READS AS UNDER:- 3. HENCEFORTH, APPEAL/SLPS SHALL NOT BE FILED IN C ASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY L IMITS GIVEN HEREUNDER:- S.NO. APPEALS IN INCOME - TAX MATTERS MONETA RY 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. 4. IN PARAGRAPH 10 OF THE CIRCULAR, SUCH MONETARY L IMITS HAVE BEEN MADE APPLICABLE RETROSPECTIVELY. FOR READY REFEREN CE, WE REPRODUCE PARAGRAPH 10 BELOW:- 10. THIS INSTRUCTION WILL APPLY RETROSPECTIVELY TO PENDING APPEALS AND APPEALS TO BE FILED HENCEFORTH IN HIGH COURTS/TRIBUNALS. PENDING APPEALS BELOW THE SPECIF IED TAX LIMITS IN PARA 3 ABOVE MAY BE WITHDRAWN/NOT PRESSED . APPEALS BEFORE THE SUPREME COURT WILL BE GOVERNED B Y THE INSTRUCTIONS ON THIS SUBJECT, OPERATIVE AT THE TIME WHEN SUCH APPEAL WAS FILED. 5. THEREFORE, THE ABOVE CIRCULAR WOULD BE SQUARELY APPLICABLE TO THE APPEAL UNDER CONSIDERATION BEFORE US. 6. LEARNED SENIOR DR WHO APPEARED AT THE TIME OF HE ARING BEFORE US STATED THAT HE NEEDS SOME TIME TO CALL FOR THE R EPORT FROM THE ASSESSING OFFICER AS WELL AS INSTRUCTIONS FROM ADMI NISTRATIVE CIT FOR WITHDRAWING THIS APPEAL BECAUSE THE APPEAL WAS FILE D WITH THE ITA-2935/DEL/2009 3 APPROVAL OF ADMINISTRATIVE CIT. LEARNED DR FURTHER POINTED OUT THAT IN PARAGRAPH 7 OF THE SAID CIRCULAR, IT HAS BEEN CLARI FIED BY THE CBDT THAT WITHDRAWAL OF THIS APPEAL BY THE REVENUE ON ACCOUNT OF LOW TAX EFFECT SHOULD NOT BE CONSIDERED AS A PRECEDENT IN THE SUBS EQUENT YEARS OF THE ACCEPTANCE OF ISSUES INVOLVED IN THIS APPEAL AN D, THEREFORE, IF IN THE SUBSEQUENT YEAR SIMILAR ISSUE ARISES BEFORE THE ITA T WHERE THE APPEAL IS ABOVE THE TAX LIMIT AS PRESCRIBED IN THIS CIRCUL AR, THE SAME SHOULD BE DECIDED ON MERITS. 7. LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER H AND, STATED THAT THE CIRCULAR IS SQUARELY APPLICABLE TO THE FACTS OF THE ASSESSEES CASE. 8. AFTER CONSIDERING THE SUBMISSIONS OF BOTH THE SI DES, WE ARE OF THE OPINION THAT THERE IS NO NECESSITY FOR ADJOURNING T HE APPEAL AND CALLING THE REPORT FROM THE ASSESSING OFFICER BECAUSE, APPA RENTLY, THE TAX EFFECT INVOLVED IN THIS APPEAL OF THE REVENUE IS BE LOW `10 LAKHS. HOWEVER, WE ADD HERE THAT IF ON RECEIPT OF ORDER TH E ASSESSING OFFICER FINDS THAT THE TAX EFFECT IS ABOVE `10 LAKHS OR, IN ANY OTHER MANNER, THE CIRCULAR IS NOT APPLICABLE, HE WILL BE AT LIBERTY T O FILE THE MISCELLANEOUS APPLICATION. WE ALSO AGREE WITH THE CONTENTION OF THE LEARNED DR THAT THIS ORDER WOULD NOT BE CONSIDERED AS AN ACCEPTANCE BY THE REVENUE ON THE ISSUE INVOLVED IN THIS APPEAL AND WILL NOT B E AN ESTOPPEL FOR THE REVENUE TO TAKE UP THE ISSUE INVOLVED IN THIS APPEA L BEFORE THE ITAT ON MERITS IF THE TAX EFFECT IN THOSE YEARS IS MORE THA N `10 LAKHS. WITH THIS REMARK, WE DEEM IT PROPER TO DISMISS THE APPEAL IN THE LIGHT OF THE CIRCULAR NO.21/2015 OF CBDT DATED 10 TH DECEMBER, 2015. 9. IN THE RESULT, THE APPEAL OF THE REVENUE IS DISM ISSED. DECISION PRONOUNCED IN THE OPEN COURT ON 29.03.2016 . SD/- SD/- ( (( ( BEENA A. PILLAI BEENA A. PILLAI BEENA A. PILLAI BEENA A. PILLAI ) )) ) ( (( ( G.D. AGRAWAL G.D. AGRAWAL G.D. AGRAWAL G.D. AGRAWAL ) )) ) JUDICI JUDICI JUDICI JUDICI AL MEMBER AL MEMBER AL MEMBER AL MEMBER VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VICE PRESIDENT VK. ITA-2935/DEL/2009 4 COPY FORWARDED TO: - 1. APPELLANT : DEPUTY DIRECTOR OF INCOME TAX, DEPUTY DIRECTOR OF INCOME TAX, DEPUTY DIRECTOR OF INCOME TAX, DEPUTY DIRECTOR OF INCOME TAX, INTERNATIONAL TAXATION, DEHRADUN. INTERNATIONAL TAXATION, DEHRADUN. INTERNATIONAL TAXATION, DEHRADUN. INTERNATIONAL TAXATION, DEHRADUN. 2. RESPONDENT : M/S OFFSHORE HYUNDAI INTERNATIONAL LIMITED, M/S OFFSHORE HYUNDAI INTERNATIONAL LIMITED, M/S OFFSHORE HYUNDAI INTERNATIONAL LIMITED, M/S OFFSHORE HYUNDAI INTERNATIONAL LIMITED, C/O HEMANT ARORA & CO., CAS, C/O HEMANT ARORA & CO., CAS, C/O HEMANT ARORA & CO., CAS, C/O HEMANT ARORA & CO., CAS, 1 11 1- -- - TYAG TYAG TYAG TYAGI ROAD, DEHRADUN I ROAD, DEHRADUN I ROAD, DEHRADUN I ROAD, DEHRADUN 248 001. 248 001. 248 001. 248 001. 3. CIT 4. CIT(A) 5. DR, ITAT ASSISTANT REGISTRAR