ITO, Ward - 36(3), Kolkata, Kolkata V. Shri Samrath Mal Jain, Kolkata

ITA 435/KOL/2011

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 48184 (ITAT-KOLKATA)
• Duration Of Justice: 2 month(s) 30 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-06-2011
• Appeal Filed By: Department
• Bench Allotted: B
• Assessment Year: 2005-2006
• Appeal Filed On: 14-03-2011
• Court: TRIBUNAL
• Department Lawyers: G MONDAL
• Assessee Lawyers: V N PUROHIT
• Keywords: Tax effect
• Section: 260A

Judgement Text

, , , IN THE INCOME TAX APPELLATE TRIBUNAL, BEN CH B, KOLKATA () BEFORE , , , , , SHRI MAHAVIR SINGH, JUDICIAL MEMBER. /AND . .. .!' !'!' !'. .. . , #$ SHRI C.D.RAO, ACCOUNTANT MEMBER % % % % / ITA NO . 435/KOL/2011 &' ()/ ASSESSMENT YEAR : 2005-06 (+, / APPELLANT ) I.T.O., WARD-36(3), KOLKATA - & - - VERSUS - . (./+,/ RESPONDENT ) SHRI SAMRATH MAL JAIN,. KOLKATA (PAN: ACUPJ 4806 B) +, 0 1 #/ FOR THE APPELLANT: SHRI G.MONDAL ./+, 0 1 #/ FOR THE RESPONDENT: SHRI V.N.PUROHIT #2 / ORDER ( (( ( . .. .!' !'!' !'. .. . ) )) ), , , , #$ PER SHRI C.D.RAO, AM THIS APPEAL IS FILED BY THE REVENUE AGAINST THE OR DER DATED 20.12..2010 OF THE CIT(A)-XX, KOLKATA PERTAINING TO A.YR. 2005-06. 2. IN THIS APPEAL THE REVENUE HAS TAKEN THE FOL LOWING GROUNDS OF APPEAL :- 1. THE LD. CIT(A)-XX, KOLKATA HAS ERRED IN REJECT ING THE CONCLUSION OF THE ASSESSING OFFICER THAT LONG TERM CAPITAL GAIN OF RS .7,99,589/- FROM SALE OF SHARES CLAIMED AS EXEMPT SHOULD BE TREATED AS INCOM E FROM UNDISCLOSED SOURCE. 3. AT THE TIME OF HEARING THE LD. AR APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT IN THIS CASE THE TAX EFFECT IS BELOW RS. 3 LAK HS BY REFERRING TO THE ASSESSMENT ORDER WHEREIN THE AO HAS CALCULATED THE TOTAL TAX INVOLVE D AT RS.2,86,269/- INCLUDING THE 2 SURCHARGE AND EDUCATION CESS. THEREFORE, AS PER THE INSTRUCTION OF CBDT CIRCULAR THE REVENUE IS BARRED FROM FILING OF THE APPEAL BEFORE THIS TRIBUNAL. 4. THE LD. DR APPEARING ON BEHALF OF THE REVENUE D ID NOT RAISE ANY OBJECTION TO THE CONTENTION OF THE LD. AR OF THE ASSESSEE. 5. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CAREF UL PERUSAL OF THE ASSESSMENT ORDER, IT IS OBSERVED THAT THE TAX EFFECT IN THIS C ASE IS BELOW RS.3 LAKHS. SINCE THE TAX IS LESS THAN RS. 3 LAKHS AS PER CBDT INSTRUCTION NO.3/ 2011(F.NO.279/MISE/142/2007- ITJ) DATED 9.2.2011 WHEREIN IT HAS BEEN ENHANCED TH E LIMITS FOR FILING OF APPEALS BEFORE THE TRIBUNAL TO RS.3 LAKHS THE REVENUES APP EAL IS LIABLE TO BE DISMISSED IN LIMINE. IN VIEW OF THE LATEST ORDER OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS DELHI RACE CLUB IN ITA NO.128/2008 DATED 03.03.2 011 HAS HELD AS UNDER :- THE TAX EFFECT INVOLVED IN THE PRESENT APPEAL IS RS.4,65,860/-. AS PER RECENT GUIDELINES OF THE CBDT, APPEAL IN THOSE CASES WHERE THE TAX EFFECT IS LESS THAN 10 LACS, ARE NOT BE ENTERTAINED. THIS COURT IN THE CASE OF COMMISSIONER OF INCOME TA X-III V. M/S. P.S.JAIN AND CO. BEING NO.179/1991 DECIDED ON 2 ND AUGUST, 2010 HAS TAKEN A VIEW THAT SUCH CIRCULAR WOULD ALSO APPLY TO PENDING CASES. 5.1. ADMITTEDLY THE TAX PAYABLE IN RESPECT OF GROUN DS OF APPEAL BY THE DEPARTMENT IS LESS THAN RS.3 LAKHS AND AS PER REVISED INSTRUCT ION OF THE CBDT NO. 3 DATED 9.2.2011 WHEREIN THE CBDT HAS REVISED THE FILING LI MITS FILED BEFORE THE TRIBUNAL, HIGH COURT AND SUPREME COURT AS UNDER :- BEFORE THE INCOME TAX APPELLATE TRIBUNAL : RS. 3 L AKHS, APPEALS U/S 260A OF THE IT ACT BEFORE THE HONBLE HIGH COURT : RS.10 LAKHS AND BEFORE THE HONBLE SUPREME COURT : RS.25 LAKHS SINCE IN THE PRESENT CASE THE ABOVE REVISED INSTRUC TION IS WELL APPLICABLE IN VIEW OF THE HONBLE DELHI HIGH COURT (SUPRA) HENCE IN OUR OPINI ON THE REVENUES APPEAL IS NOT MAINTAINABLE IN VIEW OF THE SAID CIRCULAR OF THE CB DT. 5.2. WE FURTHER FIND THAT IT IS A SETTLED LAW THAT THE CIRCULARS ISSUED BY CBDT ARE BINDING ON THE REVENUE. THIS POSITION WAS CONFIRMED BY THE APEX COURT IN THE CASE OF COMMISSIONER OF CUSTOMS VS INDIAN OIL CORPORATIO N LTD. REPORTED IN 267 ITR 272 3 WHEREIN THEIR LORDSHIPS EXAMINED THE EARLIER DECISI ONS OF THE APEX COURT WITH REGARD TO BINDING NATURE OF THE CIRCULAR AND LAID DOWN THA T WHEN A CIRCULAR ISSUED BY THE BOARD REMAINS IN OPERATION THEN THE REVENUE IS BOUN D BY IT AND CANNOT BE ALLOWED TO PLEAD THAT IT IS NOT VALID OR THAT IT IS CONTRARY T O THE TERMS OF THE STATUTE. THE APPEAL UNDER CONSIDERATION HAS CERTAINLY BEEN FILED CONTRA RY TO THE CIRCULAR ISSUED BY THE CBDT INSTRUCTION NO.3 DATED 9.2.2011. 5.3. IN VIEW OF THE ABOVE, WE HOLD THAT THE APPEAL FILED BY THE DEPARTMENT, AGAINST THE IMPUGNED ORDER OF THE LD. CIT(A), IS CONTRARY T O THE POLICY DECISION OF THE DEPARTMENT AND AS SUCH THE APPEAL FILED BY THE DEPA RTMENT IS DISMISSED IN LIMINE . 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 13.06.2011. SD/- SD/- , , , , MAHAVIR SINGH, JUDICIAL MEMBER . .. .!' !'!' !'. .. . , ,, , #$ #$ #$ #$ , C.D.RAO, ACCOUNTANT MEMBER. ( (( ('$ '$ '$ '$) )) ) DATE: 13.06.2011. #2 0 .3 4#3(5- COPY OF THE ORDER FORWARDED TO: 1. SHRI SAMRATH MAL JAIN, 25A, SWALLOW LANE, KOLKATA-7 00001. 2 THE I.T.O., WARD-36(3), KOLKATA 3. THE CIT, 4. THE CIT(A)-XX, KOLKATA 5. DR, KOLKATA BENCHES, KOLKATA /3 ./ TRUE COPY, #2&:/ BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES R.G.(.P.S.) 4