The ACIT, Bhopal V. M/s R K Hotels PVT, Ltd., Bhopal

ITA 383/IND/2009

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 1530 (ITAT-INDORE)
• Duration Of Justice: 2 month(s) 12 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-10-2009
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 06-10-2009
• Assessment Year: 2006-2007
• Appeal Filed On: 25-07-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: APARNA KARAN
• Assessee Lawyers: SSH H P VERMA
• Keywords: Tax effect
• Section: 260A; 268A

Judgement Text

PAGE 1 OF 4 IN THE INCOME TAX APPELATE TRIBUNAL, INDORE BENCH, INDORE BEFORE SHRI JOGINDER SINGH, JM AND SHRI V.K. GUPTA, AM ITA NO.383/IND/2009 AY : 2006-07 ACIT-3(1), BHOPAL ..APPELLANT V/S. M/S. R.K. HOTELS PVT. LTD., 243-A, ZONE-I, M.P. NAGAR, BHOPAL (PAN AAACR 8986 K) ..RESPONDENT DEPARTMENT BY : SMT. APARNA KARAN, ADDL. CIT, DR ASSESSEE BY : S/SH. H.P. VERMA & ASHISH GOYAL ORDER PER JOGINDER SINGH, JM THIS APPEAL IS BY THE REVENUE AGAINST THE ORDER OF LD. CIT-(A)-II, BHOPAL, DATED 31.3.2009 FOR THE AY 2005-06 ON THE GROUND TH AT THE LD. FIRST APPELLATE AUTHORITY ERRED IN DELETING THE ADDITION OF 6,37,20 6/- MADE BY THE AO BY APPLYING THE PROVISIONS OF SEC. 154(3) ON ACCOUNT O F INCORRECTNESS AND INCOMPLETENESS OF BOOKS OF ACCOUNT.. 2. DURING HEARING OF THE APPEAL, WE HAVE HEARD SMT. APARNA KARAN, LD. SR. DR AND SHRI H.P. VERMA ALONG WITH SHRI ASHISH GOYAL , LD. COUNSEL FOR ASSESSEE. AT THE OUTSET, IT WAS POINTED OUT THAT TH ERE IS TYPOGRAPHICAL ERROR IN PAGE 2 OF 4 MENTIONING THE FIGURE OF RS.6,37,206/- IN THE GROU ND OF APPEAL AS THE CORRECT FIGURE IS RS.3,94,732/-. THE ASSERTION OF THE ASSES SEE WAS CONSENTED TO BE CORRECT BY THE LD. SR. DR. FURTHER, IT WAS POINTED OUT THAT THE TAX EFFECT IS ALSO BELOW MONETARY LIMIT, THEREFORE, THE APPEAL OF THE REVENUE MAY BE DISMISSED. THE LD. SR. DR FAIRLY AGREED TO THE SUBMISSION OF T HE ASSESSEE TO THE EXTENT THAT THE TAX EFFECT IS BELOW PRESCRIBED MONETARY LI MIT FOR FILING THE APPEAL BEFORE THE TRIBUNAL. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USED THE MATERIAL AVAILABLE ON THE FILE. WE HAVE FOUND THAT WHILE DIS POSING OF GROUND NO.3 (PAGE 2 OF THE IMPUGNED ORDER), THERE IS A MENTION THAT T HE ADDITION OF RS.3,94,732/- WAS MADE BY ESTIMATING THE NET PROFIT @5% OF THE TOTAL TURNOVER OF RS.1,27,44,130/- IN PLACE OF RS.2,42,47 4/- SHOWED BY THE ASSESSEE, THEREFORE, WITHOUT GOING INTO THE MERIT O F THE CASE, WE ARE OF THE VIEW THAT SINCE THE TAX EFFECT IS BELOW PRESCRIBED MONETARY LIMIT AND ALSO INSERTION OF SEC. 268A IN THE ACT, THIS APPEAL OF T HE REVENUE DESERVES TO BE DISMISSED. THE BOARD VIDE INSTRUCTION NO. 5 OF 2008 DATED 15.5.2008 SPECIFIED THE MONETARY LIMIT FOR FILING APPEAL BEFORE VARIOUS COURTS/TRIBUNAL. THE BOARD INSTRUCTION NO. 1979 DATED 23.3.2000, NO. 198 5 DATED 19.6.2000, NO. 6 OF 2003 DATED 17.7.2003, NO. 19 OF 2003 DATED 23.12 .2002, NO. 5 / 2004 DATED 27.5.2004, NO.2 / 2005 DATED 24.10.2005, NO.5 / 2007 DATED 16.7.2007 AND INSTRUCTION NO. 5/2008 DATED 15.5.2008, WHEREI N MONETARY LIMIT FOR FILING DEPARTMENTAL APPEALS (IN INCOME TAX MATTERS) AND OT HER CONDITIONS WERE PAGE 3 OF 4 SPECIFIED FOR FILING APPEALS BEFORE THE APPELLATE T RIBUNAL, HIGH COURTS AND SUPREME COURT. IN SUPPRESSION OF THE ABOVE INSTRUC TIONS, IT WAS DECIDED BY THE BOARD THAT DEPARTMENTAL APPEAL WILL BE FILED, C ONSIDERING THE MONETARY LIMIT, AS UNDER:- S.NO. AUTHORITY MONETARY LIMIT (IN RS.) 1 ITAT 2,00,000/- 2 APPEAL UNDER SECTION 260A BEFORE HIGH COURT 4,00,000/- 3 SUPREME COURT 10,00,000/- THE BOARD FURTHER CLARIFIED THE TAX EFFECT, WHICH M EANS THE DIFFERENCE BETWEEN THE TAX ON THE TOTAL INCOME ASSESSED AND THE TAX TH AT WOULD HAVE BEEN CHARGEABLE, HAD SUCH TOTAL INCOME BEEN REDUCED BY T HE AMOUNT OF INCOME IN RESPECT OF THE ISSUE AGAINST WHICH APPEAL IS INTEND ED TO BE FILED. HOWEVER, THE TAX WILL NOT INCLUDE ANY INTEREST THEREON. IN CASES OF PENALTY ORDERS, THE TAX EFFECT WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE ORDER TO BE APPEALED AGAINST. IN THE PRESENT APPEAL, THE TOT AL DISPUTED ADDITION IS RS.3,94,732/-, THEREFORE, AS AGREED/CANVASSED BY LD . REPRESENTATIVES FROM BOTH SIDES, THE TAX EFFECT IS BELOW RS.2 LAKHS, THE LIMIT PRESCRIBED FOR FILING APPEAL BEFORE THE TRIBUNAL, THEREFORE, APPEAL OF TH E REVENUE DESERVES TO BE PAGE 4 OF 4 DISMISSED. OUR VIEW FINDS SUPPORT FROM THE DECISIO N OF THE CHANDIGARH BENCH OF THE TRIBUNAL IN THE CASES OF SHRI J.S. LUTHRA (I TA NO.712 TO 715/CHD/2009) AND ITO, WARD 2(2), ROPAR VS. THE JHALLIAN KALAN PR I. COOP MILK PRODUCE SOCIETY LTD., JHALLIAN KALAN DISTT. ROPAR (ITA NO.7 21/CHD/2009). THEREFORE, WITHOUT GOING INTO THE MERITS OF THE CASE, FACTS AN D THE JUDICIAL PRONOUNCEMENTS (SUPRA), THIS APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES OF BOTH SIDES ON 6.10.2009. SD/- SD/- (V.K. GUPTA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 6.10.2009 !VYAS! COPY TO: APPELLANT/RESPONDENT/CIT/ CIT(A)/DR