ITO, Rudrapur V. M/s Singhal Enterprises, Rudrapur

ITA 4447/DEL/2011

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 7001 (ITAT-DELHI)
• Duration Of Justice: 4 year(s) 8 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 01-07-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 30-06-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 05-10-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANIMA BARNWAL
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER ITA NO. 4447/DEL/2011 ASSESSMENT YEAR: 2004-05 INCOME TAX OFFICER, VS. M/S SINGHAL ENTERPRISES MANDI PARISAR, KASHIPUR ROAD, BAGWADA, KICHHA ROAD, RUDRAPUR, DISTT. U.S. RUDRAPUR, NAGAR, DISTT. U.S. NAGAR, UTTARAKHAND-263153 UTTARAKHAND-263153 (PAN: AAEFS7127C) ( APPELLANT) (RESPONDENT) APPELLANT BY : SMT. ANIMA BARNWAL, SR. DR RESPONDENT BY : SH. V. RAJA KUMAR, ADV. DATE OF HEARING : 30-06-2016 DATE OF ORDER : 01-07-2016 ORDER PER H.S. SIDHU, J.M. THIS APPEAL BY THE DEPARTMENT IS DIRECTED AGAINST T HE ORDER DATED 18.7.2011 OF LD. CIT(A)-II, DEHRADUN, CAMP AT HALD WANI PERTAINING TO ASSESSMENT YEAR 2004-05 ON THE FOLLOWING GROUNDS:- 1. ON FACTS AND CIRCUMSTANCES OF THE CASE, LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN DELETING ADDITION OF RS 6,13 ,951.00 ON ALC OF SALES OF RICE BRAN GIVING REASON THAT TWO RI CE MILLERS OF THE SAME VICINITY HAVE SHOWN RECOVERY AT 6% AND HE ALSO RELIED ON DECISIONS OF HON'BLE ITAT AND HON'BLE CIT (A), HOWEVER, HE HAS NOT TAKEN INTO CONSIDERATION THE TH REE COMPARABLE CASES MENTIONED IN THE .ASSESSMCNT ORDER WHO HAVE SHOWN RECOVERY MORE' THAN 7% AND ALSO NOT APPR ECIATED ITA NO.4447/DEL/2011 2 THE FACT THAT THE HON'BLE ITAT AND HON'BLE UTTARAKH AND HIGH COURT, NAINITAL HAVE CONFIRMED THE ADDITION MADE BY THE AO ON ALC OF HUSK, WITHOUT DETECTING OUTSIDE BOOKS SALES. 2. LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN RED UCING ADDITION OF RS 2,25,000.00 FROM RS 4,50,000.00 WITHOUT GIVIN G ANY REASON. THE QUANTUM OF ADDITION HAS ALREADY BEEN RE DUCED BY THE AO IN THE SET-ASIDE ASSESSMENT PROCEEDINGS IN T HE LIGHT OF JUDGMENTS OF HON'BLE ITAT AND HON'BLE UTTRAKHAND HI GH COURT, NAINITAL AGAINST FROM RS 7,06,535.00 TO RS 4,50,000 .00. 3. LD. CIT (A) HAS ERRED IN LAW AND ON FACTS IN DEL ETING ADDITION OF RS 1,53,648.00 ON ALC OF UNDER VALUATION OF CLOSING STOCK OF FINISHED GOODS (RICE BRAN) ON THE GROUND THAT THE A O HAS VALUED CLOSING STOCK AT MARKET PRICE BUT VALUATION OF CLOSING STOCK AT COST PRICE IS CORRECT OPTION. THE DISPUTE IS ONLY THAT RATE WAS INCORRECTLY ADOPTED BY THE ASSESSEE. THE A SSESSEE HAS NEVER CLAIMED THAT VALUATION HAS BEEN MADE BY H IM AT COST PRICE, THUS, ADDITION MADE BY ADOPTING ACTUAL MARKET RATE IS CORRECT. THE DECISION QUOTED BY LD CIT(A) RELATE S TO METHOD OF VALUATION, HENCE, NOT RELEVANT. 4. ANY OTHER GROUNDS RAISED DURING THE PROCEEDINGS OF APPEAL. 2. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE M ATERIAL ON RECORD. FROM THE ABOVE, WE FIND THAT THE TAX EFFECT IN THE REVENUES APPEAL IS LESS THAN RS.10,00,000/-, THEREFORE, THE DEPARTMENTS AP PEAL IS NOT MAINTAINABLE, IN VIEW OF THE CIRCULAR NO. 21/2015 DATED 10 TH DECEMBER, 2015 ISSUED VIDE F.NO. 279/MISC. 142/2007-ITJ (PT.) BY THE CBDT. FOR ITA NO.4447/DEL/2011 3 THE SAKE OF CONVENIENCE, THE RELEVANT PARA NOS. 3 & 10 OF THE AFORESAID CBDTS CIRCULAR ARE REPRODUCED AS UNDER:- 3. HENCEFORTH, APPEALS/ SLPS SHALL NOT BE FILED IN CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY LIMITS GIVE N HEREUNDER: S NO APPEALS IN INCOME-TAX MATTERS MONETARY 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 MONETARY LIMITS PR ESCRIBED ABOVE. FILING OF APPEAL IN SUCH CASES IS TO BE DECIDED ON MERITS OF THE CASE. 10. THIS INSTRUCTION WILL APPLY RETROSPECTIVELY TO PENDING APPEALS AND APPEALS TO BE FILED HENCEFORTH IN HIGH COURTS/ TRIBUNALS. PENDING APPEALS BELOW THE SPECIFIED TAX LIMITS IN PARA 3 ABOVE MAY BE WITHDRAWN/ NOT PRESSED. APPEALS BEFORE THE SUPREME COURT WILL BE GOVERNED BY THE INSTRUCTIONS ON THIS SUBJECT, OPERATIVE AT THE TIME WHEN SUCH APPEAL WAS FILED. 3. IT IS NOT IN DISPUTE THAT THE BOARDS INSTRUCTIO N OR DIRECTIONS ISSUED TO THE INCOME-TAX AUTHORITIES ARE BINDING ON THOSE AUTHORI TIES, THEREFORE, THE DEPARTMENT SHOULD HAVE WITHDRAWN/ NOT PRESSED THE P RESENT APPEAL, IN VIEW OF THE AFORESAID INSTRUCTIONS SINCE THE TAX EFFECT IN THE INSTANT APPEAL IS LESS THAN THE AMOUNT OF RS. 10 LACS, PRESCRIBED IN THE ABOVE SAID CBDTS INSTRUCTIONS. 4. KEEPING IN VIEW THE CBDT INSTRUCTION NO. 21/2015 DATED 10 TH DECEMBER, 2015, WE ARE OF THE VIEW THAT THE REVENUE SHOULD HA VE WITHDRAWN/ NOT PRESSED ITA NO.4447/DEL/2011 4 THE INSTANT APPEAL BEFORE THE TRIBUNAL. WE ARE ALS O OF THE VIEW THAT THE SAID INSTRUCTIONS ARE APPLICABLE FOR THE PENDING APPEALS AND APPEALS TO BE FILED HENCEFORTH IN TRIBUNAL. ACCORDINGLY, THE REVENUES APPEAL IS DISMISSED. 5. IN THE RESULT, APPEAL FILED BY THE REVENUE STAN DS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 01/07/2016. SD/- SD/- (O.P. KANT) (H.S. SIDHU) ACCOUNTANT MEMBER JUDICIA L MEMBER DATED: 01/07/2016 *SR BHATNAGAR* COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR