DCIT, New Delhi V. M/s CKSR Impex International Pvt. Ltd, New Delhi

ITA 5518/DEL/2010

• Counselvise Citation: [2011] 134 COUNSELVISE.COM (IT) 3608 (ITAT-DELHI)
• Duration Of Justice: 7 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 15-07-2011
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 05-07-2011
• Assessment Year: 2006-2007
• Appeal Filed On: 07-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: Y KAKKAR
• Assessee Lawyers: K SAMPATHGAURAV GOEL
• Keywords: Business income; Tax effect
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH B NEW DELHI) BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI B.C. MEENA, ACCOUNTANT MEMBER I.T.A. NO.5518/DEL/2010 ASSESSMENT YEAR : 2006-07 DY. CIT, DY. CIT, DY. CIT, DY. CIT, VS. VS. VS. VS. M/S CKSR IMPEX INTERNATIONA M/S CKSR IMPEX INTERNATIONA M/S CKSR IMPEX INTERNATIONA M/S CKSR IMPEX INTERNATIONAL (P) L (P) L (P) L (P) CIRCLE CIRCLE CIRCLE CIRCLE- -- -3(1), 3(1), 3(1), 3(1), LTD., D LTD., D LTD., D LTD., D- -- -68, 1 68, 1 68, 1 68, 1 ST STST ST FLOOR, ASHOK VIKAR, FLOOR, ASHOK VIKAR, FLOOR, ASHOK VIKAR, FLOOR, ASHOK VIKAR, NEW DELHI NEW DELHI NEW DELHI NEW DELHI PHASE PHASE PHASE PHASE- -- -I, NEW DELHI I, NEW DELHI I, NEW DELHI I, NEW DELHI PAN NO.AACCC 3384 J (APPELLANT) (RESPONDENT) APPELLANT BY :SHRI Y. KAKKAR, SR. DR RESPONDENT BY : S/SHRI K. SAMPATH/GAURAV GOEL, CA ORDER PER RAJPAL YADAV:JM: THE REVENUE IS IN APPEAL BEFORE US AGAINST THE ORDE R OF CIT(A) DATED 29.10.2010 PASSED FOR ASSESSMENT YEAR 2006- 07. THE REVENUE IS IMPUGNING THE DELETION OF DISAL LOWANCE MADE U/S 14A AS WELL AS DIRECTIONS GIVEN TO THE ASS ESSING OFFICER THAT SHORT TERM CAPITAL GAIN DISCLOSED BY T HE ASSESSEE ON UNITS OF MUTUAL FUNDS HELD BY ASSESSEE FOR A PER IOD OF LESS THAN THREE MONTHS SHOULD NOT BE TREATED AS BUSINESS INCOME. 2. LEARNED COUNSEL FOR THE ASSESSEE AT THE VERY OUT SET SUBMITTED THAT TAX EFFECT IN THIS APPEAL IS OF `2,2 7,512/- WHICH IS LESS THAN `3 LACS AND, THEREFORE, APPEAL O F THE 2 REVENUE IS NOT MAINTAINABLE IN VIEW OF THE LATEST I NSTRUCTIONS ISSUED BY THE BOARD. HE PLACED ON RECORD THE COMPU TATION OF TAX WHICH READS AS UNDER:- GROUNDS INCOME TAX EFFECT ` DISALLOWANCE U/S 14A DISALLOWED BY A.O. `7,34,400/- RELIEF BY CIT(A) `1,25,500 AMOUNT IN APPEAL 6,08,900 TAX @ 33.6% 2,04,5900 SHORT TERM CAPITAL GAIN TREATED AS BUSINESS INCOME. ON `1,14,608 DIFFERENTIAL RATE @ 20% 22,922 TOTAL 2,27,512 3. THE LEARNED COUNSEL ALSO PLACED ON RECORD COPY O F THE HONBLE DELHI HIGH COURTS DECISION IN THE CASE OF CIT VS. M/S P.S. JAIN AND COMPANY. HE POINTED OUT THAT HONBLE DELHI HIGH COURT HAS HELD THAT INSTRUCTIONS ISSUED IN THE MONTH OF FEBRUARY, 2011 WOULD BE APPLICABLE ON THE PENDING A PPEALS. 4. ON THE OTHER HAND, LEARNED DR SUBMITTED THAT FUL L BENCH OF HONBLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF CIT VS. VIRENDER CONSTRUCTION COMPANY REPORTED IN 2 39 CTR PAGE 1 HAS HELD THAT THESE INSTRUCTIONS WILL NOT BE APPLICABLE ON PENDING APPEALS RATHER THEY WILL GOVERN THE APPE ALS, WHICH ARE TO BE FILED AFTER ISSUANCE OF THE INSTRUC TIONS. 5. WE HAVE DULY CONSIDERED THE RIVAL CONTENTION AND GONE THROUGH THE RECORD CAREFULLY. THE TAX IS LESS THAN `3 LACS. THE BOARD HAS ISSUED INSTRUCTION BEARING NO.3 ON 9 TH FEBRUARY, 2009 WHEREBY IT HAS DIRECTED THE INCOME T AX 3 AUTHORITIES NOT TO CHALLENGE THE ORDER OF COMMISSIO NER BEFORE THE TRIBUNAL IF TAX EFFECT BECAUSE OF SUCH O RDER IS LESS THAN `3 LACS. THE HONBLE DELHI HIGH COURT IN THES E TWO DECISIONS HAVE OBSERVED THAT THESE INSTRUCTIONS WIL L BE APPLICABLE ON PENDING APPEALS. THE PRESENT APPEAL I S NOT COVERED BY EXCEPTIONS PROVIDED IN THE INSTRUCTIONS. IN VIEW OF THE DELHI HIGH COURTS DECISION, THE APPEAL IS N OT MAINTAINABLE, HENCE, DISMISSED. 6. IN RESULT, THE APPEAL OF THE REVENUE IS DISMISSE D. THIS ORDER WAS PRONOUNCED IN THE OPEN COURT ON 15.07.2011. SD/- SD/- ( B.C. MEENA ) ( RAJPAL YADAV ) ACCOUNTANT MEMBER JUDICIAL MEMBER DT. 15.07.2011. NS COPY FORWARDED TO:- 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT 4. THE CIT (A)-, NEW DELHI. 5. THE DR, ITAT, LOKNAYAK BHAWAN, KHAN MARKET, NEW DELHI. TRUE COPY. BY ORDER (ITAT, NEW DELHI).