DCIT 9(2), MUMBAI V. KONKAN POLYMERS & ADDITIVES P.LTD, MUMBAI

ITA 5573/MUM/2011

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 4550 (ITAT-MUMBAI)
• Duration Of Justice: 9 year(s) 2 month(s) 22 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-10-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: H
• Assessment Year: 2008-2009
• Appeal Filed On: 29-07-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R BHOOPATHI
• Keywords: Tax effect
• Section: 143(3); 115JB; 13

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH H MUMBAI BEFORE SHRI MAHAVIR SINGH (VICE PRESIDENT) AND SHRI N.K. PRADHAN (ACCOUNTANT MEMBER) ITA NO. 2674/MUM/2007 ASSESSMENT YEAR: 2003-04 & ITA NO. 3956/MUM/2010 ASSESSMENT YEAR: 2007-08 DCIT, CIR. 12(3)(1), ROOM NO. 147B, 1 ST FLOOR, AAYAKAR BHAVAN. VS. M/S KONKAN POLYMERS AND ADDITIVES PVT. LTD., B1-6, BONANZA INDUSTRIAL ESTATE, CHAKRAVARTI ASHOK ROAD, KANDIVALI (EAST), MUMBAI. PAN NO. AABCK6738K APPELLANT RES PONDENT ITA NO. 5573/MUM/2011 ASSESSMENT YEAR: 2008-09 DCIT RANGE 9(2), AAYAKAR BHAVAN, R. NO. 218, 2 ND FLOOR, M.K. ROAD, MUMBAI-400020. VS. M/S KONKAN POLYMERS AND ADDITIVES PVT. LTD., B1-6, JAI BONANZA INDUSTRIAL ESTATE, CA ROAD, KANDIVALI (E), MUMBAI400101. PAN NO. AABCK6738K APPELLANT RESPONDENT REVENUE BY : MR. R. BHOOPATHI , DR ASSESSEE BY : MR. J.D. MISTRI& MR. DHARMESH SHAH, ARS DATE OF HEARING : 19/10/2020 DATE OF PRONOUNCEMENT : 21/10/2020 M/S KONKAN POLYMERS ITA NOS. 2674/MUM/2007 & ORS. 2 ORDER PER N.K. PRADHAN, A.M. THE CAPTIONED APPEALS FILED BY THE REVENUE ARE DIRE CTED AGAINST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS)-9 /20, MUMBAI AND ARISE OUT OF THE ASSESSMENT COMPLETED U/S 143(3) OF THE I NCOME TAX ACT 1961 (THE ACT). AS COMMON ISSUES ARE INVOLVED, WE ARE PROCE EDING TO DISPOSE THEM OFF BY THIS CONSOLIDATED ORDER FOR THE SAKE OF CONVENIE NCE. 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 OF MONETARY LIMIT FOR FILING OF APPEALS BY THE REVENUE BEFORE THE ITAT, HIGH COURTS AND SLPS/APPEALS BEFORE SUPREME C OURT 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 AP PELLATE TRIBUNAL (ITAT) IN CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONE TARY LIMIT OF RS.20,00,000/-. FOR THIS PURCHASE, TAX EFFECT MEA NS 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 TH E AMOUNT OF INCOME IN RESPECT OF ISSUES AGAINST WHICH APPEAL IS INTENDED TO BE FILED. FURTHER, TAX EFFECT SHALL BE TAXES INCLUDING APPLICABLE SURCHAR GE 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 SHALL BE THE TAX EF FECT. IN CASES WHERE RETURNED LOSS IS REDUCED OR ASSESSED AS INCOME, THE TAX EFFE CT WOULD INCLUDE NOTIONAL TAX M/S KONKAN POLYMERS ITA NOS. 2674/MUM/2007 & ORS. 3 ON DISPUTED ADDITIONS. IN CASE OF PENALTY ORDER, TH E TAX EFFECT WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE ORDER TO BE APPEALED AGAINST. AT PARA 13 OF THE SAID CIRCULAR, IT HAS BEEN MENTIO NED THAT: 13. THIS CIRCULAR WILL APPLY TO SLPS/APPEALS/CROSS OBJECTION/REFERENCES TO BE FILED HENCEFORTH IN SC/HCS/TRIBUNAL AND IT SHALL ALSO APP LY RETROSPECTIVELY TO PENDING SLPS/APPEALS/CROSS OBJECTIONS/REFERENCES. PENDING A PPEALS BELOW THE SPECIFIED TAX LIMITS IN PARA 3 ABOVE MAY BE WITHDRAWN/NOT PRESSED . 4. AS A STEP TOWARDS FURTHER MANAGEMENT OF LITIGAT ION, CBDT VIDE CIRCULAR NO. 17/2019 HAS FIXED THE MONETARY LIMIT FOR FILING OF APPEALS BEFORE ITAT AT RS.50,00,000/-. 5. AS FILED BY THE LD. COUNSEL FOR THE ASSESSEE, TH E TAX EFFECT WITH RESPECT TO THE DEPARTMENTAL APPEAL IS AS UNDER :- PARTICULARS AY. 2003 - 04 (RS.) A.Y. 2007 - 08 (RS.) A.Y. 2008 - 09 (RS.) DISALLOWANCE MADE BY THE ASSESSING OFFICER IN THE ASSESSMENT ORDER (A) 1,21,91,200 / - 73,18,420 / - 32,99,188 / - LESS : ADDITION SUSTAINED BY LD. CIT(A) (B) -- -- -- RELIEF GIVEN BY THE LD . CIT(A) IN RESPECT OF WHICH DEPARTMENT IS IN APPEAL. (C=A-B) 1,21,91,200 / - 73,18,420 / - 32,99,188 / - TAX PAYABLE 42,66,920 / - 21,95,526 / - 9,89,756 / - ADD: EDUCATION CESS 2,13,346 / - 6,04,801 / - 29,693 / - TAX IMPACT 44,80,266 / - 28,00,327 / - 10,19,449 / - M/S KONKAN POLYMERS ITA NOS. 2674/MUM/2007 & ORS. 4 LESS: TAX PAID U /S. 115JB OF THE ACT ON THE RETURNED INCOME ( - ) 10,09,360 / - BALANCE TAX EFFECT 34,70,906 / - 28,00,327 / - 10,19,449 / - THUS IN THE AFOREMENTIONED APPEALS, THE CONSEQUENTI AL TAX EFFECT IS LESS THAN RS.50,00,000/-. THEREFORE, THE LD. COUNSEL FOR THE ASSESSEE SUBMITS THAT THE APPEAL FILED BY THE REVENUE BE DISMISSED. THE L D. DEPARTMENTAL REPRESENTATIVE (DR) FAIRLY AGREES THAT THE TAX EFFE CT HEREIN IS BELOW THE MONETARY LIMIT OF RS.50,00,000/- FIXED BY THE ABOVE CIRCULAR FOR FILING OF APPEALS BEFORE THE ITAT. 6. IN VIEW OF THE CBDT CIRCULAR NO. 17/2019, THESE APPEALS INVOLVING TAX EFFECT OF LESS THAN RS.50,00,000/- ARE DISMISSED AS WITHDRAWN. ORDER PRONOUNCED THROUGH NOTICE BOARD UNDER RULE 34 (4) OF THE INCOME TAX (APPELLATE TRIBUNAL) RULES, 1963. SD/- SD/- (MAHAVIR SINGH) (N.K. PRADHAN) VICE PRESIDENT ACCOUNTANT MEMBER MUMBAI; DATED: 21/10/2020 RAHUL SHARMA, SR. P.S. M/S KONKAN POLYMERS ITA NOS. 2674/MUM/2007 & ORS. 5 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// (DY/ASST. REGISTRAR) ITAT, MUMBAI