JT. DIT, MUMBAI V. M/s. FREIGHT CONNECTION INDIA PVT. LTD, MUMBAI

ITA 3168/MUM/2003

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 9742 (ITAT-MUMBAI)
• Duration Of Justice: 16 year(s) 8 month(s) 29 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-01-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Assessment Year: 1998-1999
• Appeal Filed On: 23-04-2003
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AVANEESH TIWARI
• Assessee Lawyers: ARPIT JAIN
• Keywords: Tax effect
• Section: 13; 22

Judgement Text

ITA NO. 3168/MUM/2003 A.Y. 1998 - 99 & C.O. NO.102/MUM/2003 (ARISING OUT OF ITA NO.3168/MUM/2003) ITA NO. 2155/MUM/2005 A.Y. 2001 - 02 JT. DIT (IT) - 3 VS. M/S FREIGHT CONNECTION INDIA PVT. LTD. 1 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH I MUMBAI BEFORE SHRI RAVISH SOOD (JUDICIAL MEMBER) AND SHRI N.K.PRADHAN (ACCOUNTANT MEMBER) ITA NO. 3168/MUM/2003 C.O. NO.102/MUM/2003 (ARISING OUT OF ITA NO.3168/MUM/2003 ) (ASSESSMENT YEAR: 1998 - 99 ) JT. DIT(IT) - 3 ROOM NO.621, 6 TH FLOOR, AAYAKAR BHAVAN, MUMBAI 400020 VS. M/S FREIGHT CONNECTION INDIA PVT. LTD., R/A OF M/S BAY LINE, MAURITIOUS PAN NO. AAACF2188H APPELLANT RESPONDENT ITA NO. 2155/MUM/2005 (ASSESSMENT YEAR:2001 - 02) DDIT(IT) - 1(1) ROOM NO.117, 1 ST FLOOR, SCINDIA HOUSE, BALLARD ESTATE, MUMBAI 400 038 VS. M/S FREIGHT CONNECTION INDIA PVT. ( A S AGENTS OF M/S ARC LINE) (MAURITIUS), CAMBATA BUILDING, 4 TH FLOOR, 101, M.K. ROAD, CHURCHGATE, MUMBAI 400 020 PAN NO. AAACF2188H APPELLANT RESPONDENT REVENUE BY : SHRI AVANEESH TIWARI , SR. D.R ASSESSEE BY : SHRI ARPIT JAIN, A.R DATE OF HEARING : 22 /01/2020 DAT E OF PRONOUNCEMENT : 22 /01/2020 ORDER PER BENCH: THE PRESENT APPEAL S FILED BY THE REVENUE ARE DIRECTED AGAINST THE RESPECTIVE ORDER S PASSED BY THE COMMISS IONER OF INCOME TAX (APPEALS) - XXXI , MUMBAI [FOR SHORT CI T(A)] DATED 15.01.2003 AND 31.12.2004 FOR A.Y. 1998 - 99 AND A.Y. 2001 - 02, RESPECTIVELY. ALSO, THE ASSESSEE IS BEFORE US BY WAY OF A CROSS - OBJECTION ARISING FROM THE APPEAL OF THE REVENUE FOR A.Y. 1998 - 99. ITA NO. 3168/MUM/2003 A.Y. 1998 - 99 & C.O. NO.102/MUM/2003 (ARISING OUT OF ITA NO.3168/MUM/2003) ITA NO. 2155/MUM/2005 A.Y. 2001 - 02 JT. DIT (IT) - 3 VS. M/S FREIGHT CONNECTION INDIA PVT. LTD. 2 2. CENTRAL BOARD OF DIRECT TAXES (CBDT) VIDE CIRCULAR NO. 17/2019 DATED 08.08.2019 HAS AMENDED CIRCULAR NO. 3/2018 DATED 11.07.2018 FOR FURTHER ENHANCEMENT O F MONETARY LIMIT FOR FILING OF APPEALS BY THE DEPARTMENT BEFORE THE ITAT, HIGH COURTS AND SLPS/APPEALS BEFORE SUPREME COURT AS MEASURES FOR REDUCING LITIGATION. 3. CBDT VIDE CIRCULAR NO. 3/2018 DATED 11.07.2018 HAS SPECIFIED THAT APPEALS SHALL NOT BE FILED BEFORE THE INCOME TAX APPELLATE TRIBUNAL (ITAT) IN CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY LIMIT OF RS.20,00,000/ - . FOR THIS PURPOSE, TAX EFFECT MEANS THE DIFFERENCE BETWEEN THE TAX ON THE TOTAL INCOME ASSESSED AND THE TAX THAT WOULD HAVE BEEN CHARGEABLE HAD SUCH TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME IN RESPECT OF ISSUES AGAINST WHICH APPEAL IS INTENDED TO BE FILED. FURTHER, TAX EFFECT SHALL B E TAXES INCLUDING APPLICABLE SURCHARGE AND CESS. HOWEVER, THE TAX WILL NOT INCLUDE ANY INTEREST THEREON, EXCEPT WHERE CHARGEABILITY OF INTEREST ITSELF IS IN DISPUTE. IN CASE THE CHARGEABILITY OF INTEREST IS THE ISSUE UNDER DISPUTE, THE AMOUNT OF INTEREST S HALL BE THE TAX EFFECT. IN CASES WHERE RETURNED LOSS IS REDUCED OR ASSESSED AS INCOME, THE TAX EFFECT WOULD INCLUDE NOTIONAL TAX ON DISPUTED ADDITIONS. IN CASE OF PENALTY ORDER, THE TAX EFFECT WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE OR DER TO BE APPEALED AGAINST. AT PARA 13 OF THE ABOVE CIRCULAR, IT HAS BEEN MENTIONED THAT: 13. THIS CIRCULAR WILL APPLY TO SLPS/APPEALS/CROSS OBJECTION/REFERENCES TO BE FILED HENCEFORTH IN SC/HCS/TRIBUNAL AND IT SHALL ALSO APPLY RETROSPECTIVELY TO PENDI NG SLPS/APPEALS/CROSS OBJECTIONS/REFERENCES. PENDING APPEALS BELOW THE SPECIFIED TAX LIMITS IN PARA 3 ABOVE MAY BE WITHDRAWN/NOT PRESSED. 4. AS A STEP TOWARDS FURTHER MANAGEMENT OF LITIGATION, CBDT VIDE CIRCULAR NO. 17/2019 HAS FIXED THE MONETARY LIMIT FO R FILING OF APPEALS BEFORE ITAT AT RS.50,00,000/ - . 5. IN THE INSTANT APPEAL S FILED BY THE DEPARTMENT, THE TAX EFFECT INVOLVED IS BELOW THE MONETARY LIMIT OF RS.50,00,000/ - . THE SAME WAS BROUGHT TO THE NOTICE OF THE LD. DEPARTMENTAL REPRESENTATIVE (DR), WH O HAD ADMITTED THE SAID FACT. 6. BEFORE US, THE LD. D.R SUBMITS THAT LIBERTY MAY KINDLY BE GIVEN TO RAISE, AFTER NECESSARY FURTHER VERIFICATION AND TO SEEK RECALL OF THE DISMISSAL OF THE APPEAL S AND THEIR RESTORATION, IN CASE IT CAN BE SHOWN THAT THEY ARE COVERED BY THE EXCEPTIONS. 7. WE AGREE WITH THE ABOVE CONTENTIONS OF THE LD. DR AND MAKE IT CLEAR THAT THE APPELLANT SHALL BE AT LIBERTY TO POINT OUT THE EXCEPTIONS AND WE WILL TAKE APPROPRIATE REMEDIAL MEASURES IN THIS REGARD. ITA NO. 3168/MUM/2003 A.Y. 1998 - 99 & C.O. NO.102/MUM/2003 (ARISING OUT OF ITA NO.3168/MUM/2003) ITA NO. 2155/MUM/2005 A.Y. 2001 - 02 JT. DIT (IT) - 3 VS. M/S FREIGHT CONNECTION INDIA PVT. LTD. 3 8. WITH THE ABOVE OBSERVAT IONS THE CAPTIONED APPEAL S INVOLVING A TAX EFFECT OF LESS THAN RS.50,00,000/ - ARE DISMISSED. AS WE HAVE DISMISSED THE APPEAL OF THE REVENUE FOR A.Y. 1998 - 99 IN ITA NO. 3168/MUM/2003 ON ACCOUNT OF LOW TAX EFFECT, THEREFORE, THE CROSS - OBJECTION FILED BY TH E ASSESSEE I.E C.O. NO. 102/MUM/2003 CANNOT SURVIVE ON A STANDALONE BASIS AND HAS TO MEET THE SAME FATE. ACCORDINGLY, THE C.O. NO. 102/MUM/2003 (ARISING OUT OF ITA NO. 3168/MUM/2003) H AVING BEEN RENDERED AS INFRUCTOU S IS ALSO DI S MISSED. 9. THE APPEALS OF THE REVENUE FOR A.Y. 1998 - 99 I.E ITA NO. 3168/MUM/2003 AND FOR A.Y. 2001 - 02 I.E ITA NO. 2155/MUM/2005, AS WELL AS THE CROSS - OBJECTION OF THE ASSESSEE FOR A.Y. 1998 - 99 I.E C.O. NO. 102/MUM/2003 (ARISING OUT OF ITA NO. 3168/MUM/2003) ARE DISMI SSED. ORDER PRO NOUNCED IN THE OPEN COURT ON 22 /01/2020. SD/ - SD/ - ( N.K. PRADHAN ) (RAVISH SOOD) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI ; DATED: 22 /01/2020 ROHIT, P.S. COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT 2. THE RESPONDENT. 3. THE CIT(A) - 4. CIT 5. DR, ITAT, MUMBAI 6. GUARD FILE . BY ORDER, //TRUE COPY// (SR. PRIVATE SECRETARY) ITAT, MUMBAI