ITO, New Delhi V. M/s. Umaxe Projects, Delhi

ITA 6035/DEL/2016

• Counselvise Citation: [2019] 112 COUNSELVISE.COM (IT) 2461 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 9 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-12-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Assessment Year: 2011-2012
• Appeal Filed On: 25-11-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: R K KAPOOR
• Keywords: Tax effect
• Section: 254(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH: E: NEW DELHI) BEFORE H.S. SIDHU, JUDICIAL MEMBER AND SHRI ANADEE NATH MISSHRA, ACCOUNTANT ME MBER ITA NO:- 6035, 6036/DEL/2016 (ASSESSMENT YEAR: 2011-12) ITO, WARD - 55(5), ROOM NO. D 3, D BLOCK, GROUND FLOOR, VIKAS BHAWAN I.P. ESTATE, NEW DELHI VS M/S UMAXE PROJECTS, C/O UMAXE PROJECTS PVT. LTD. D- 332, 3 RD FLOOR, VIVEK VIHAR, DELHI-110095 PAN-AACFU7703L APPELLANT RESPONDENT APPELLANT BY MS. RAKHI VIMAL, SR. DR RESPONDENT BY SH. R.K. KAPOOR, C.A. ORDER PER ANADEE NATH MISSHRA, AM [A]. THIS APPEAL HAS BEEN FILED BY REVENUE AGAINST THE ORDER DATED 27.08.2016 PASSED BY LEARNED COMMISSIONER OF INCOME TAX (APPEALS)-10, NEW DELHI [IN SHORT, LD.CIT(A)] PER TAINING TO ASSESSMENT YEAR 2011-12. REVENUE HAS RAISED FOLLOW ING GROUNDS OF APPEAL:- 1. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE CA SE, ID. CIT(A) IS CORRECT IN HOLDING THAT THE PAYMENT OF RS. 9 CRORES MADE BY TH E ASSESSEE TO ONE OF ITS PARTNERS UPPL AS JOB WORK EVEN WHEN THE ACTUAL CONTRACT WAS AWARDED TO THE ASSESSEE AND THERE DID NOT EXIST SUB -LETTING CONTRACT BETWEEN THE ASSESSEE AND UPPL. 2. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE, LD. CIT(A) IS CORRECT IN DELETING THE ADDITION MADE BY THE AO BASING HIS DECISION ON THE FACTS FOR A.Y. 2012-13 WHICH ARE SUBSTANTIALLY DIFFERENT FROM THE FACTS FOR A.Y. 2011-12, AS FOR A.Y. 2012-13, THE ASSESSEE HAD RECE IVED TOTAL CONTRACT ITA NO: - 6035,6036/DEL/2016 PAGE | 2 RECEIPTS OF RS. 35.94 CRORES FROM WHICH DEDUCTION O F RS, 31.4 CRORES WAS MADE FOR MATERIAL SUPPLY AND ONLY RS. 3.49 CRORES W AS DEDUCTED AS JOB WORK. 3. WHETHER ON THE FACTS AND CIRCUMSTANCE OF THE CAS E, LD.CIT(A) IS CORRECT IN DELETING THE ADDITION MADE BY THE AO WITHOUT GIVING ANY FINDING OF THE AO THAT THE APPELLANT FAILED TO COMPLY WITH THE ACCOUN TING STANDARD -7. 4. WHETHER ON THE FACTS AND CIRCUMSTANCES OF THE C ASE, LD. CIT(A) IS CORRECT IN DELETING THE ADDITION MADE BY THE AO WITHOUT ANY FINDING EVEN THOUGH THE ADDITION WAS MADE ON THE BASIS OF THE JUDICIAL DECISIONS RELIED UPON AND APPLYING THE PROFIT RATE OF 10% OF THE TOTAL RE CEIPTS BY THE ASSESSEE BY INVOKING PROVISIONS OF SECTION 145(3)/144 OF THE IN COME TAX ACT. 1961. [B]. AT THE OUTSET, IT WAS BROUGHT TO OUR NOTICE B Y LEARNED AUTHORIZED REPRESENTATIVE OF THE ASSESSEE, AT THE T IME OF HEARING, THAT TAX EFFECT IN THIS APPEAL IS BELOW RS. 50,00,0 00./-. VIDE RECENT CBDT CIRCULAR NO.17/2019 DATED 08.08.2019 READ WITH EARLIER CBDT CIRCULAR NO. 3 OF 2018, DATED 11.07.2018, MINIMUM T HRESHOLD LIMIT OF TAX EFFECT FOR FILING OF APPEALS BY REVENUE IN I NCOME TAX APPELLATE TRIBUNAL ('ITAT', FOR SHORT) HAS BEEN ENHANCED TO R S. 50,00,000/-. IN A SUBSEQUENT CLARIFICATION ISSUED BY CBDT VIDE F.NO . 279/MISC/M- 93/2018-ITJ, DATED 20/08/2019, IT HAS BEEN CLARIFIE D BY CBDT THAT THE AFORESAID REVISED MONETARY LIMIT IS ALSO APPLIC ABLE TO ALL PENDING APPEALS IN ITAT. THEREFORE, IN VIEW OF THE FOREGOIN G, WE ARE OF THE VIEW THAT THIS APPEAL FILED BY REVENUE IS NOT MAINTAINAB LE. THE LEARNED DEPARTMENTAL REPRESENTATIVE ALSO DID NOT PRESS THE APPEAL. ACCORDINGLY, THIS APPEAL IS DISMISSED BEING NOT PRE SSED, AND ALSO NOT MAINTAINABLE, HAVING REGARD TO AFORESAID CBDT CIRCU LAR NO. 17/2019 DATED 08.08.2019 READ WITH AFORESAID CBDT CIRCULAR NO. 3 OF 2018 IN THE LIGHT OF AFORESAID CLARIFICATION DATED 20/08/20 19. ITA NO: - 6035,6036/DEL/2016 PAGE | 3 [C]. BEFORE LEAVING, WE CLARIFY THAT REVENUE WILL B E AT LIBERTY TO APPROACH INCOME TAX APPELLATE TRIBUNAL U/S 254(2) O F INCOME TAX ACT, 1961 SEEKING RECALL OF THIS ORDER AND, FOR RESTORATION OF THE APPEAL IF IT IS FOUND THAT THIS APPEAL OF REVENUE IS NOT COVERED BY AFORESAID CBDT CIRCULARS DATED 08 .08.2019 AND 11.07.2018. [D]. IN THE RESULT, THE APPEALS BY REVENUE ARE DIS MISSED. OUR DECISION WAS ORALLY PRONOUNCED IN THE OPEN COURT AF TER CONCLUSION OF HEARING ON THE DATE OF HEARING. NOW, THIS WRITTEN O RDER IS PRONOUNCED IN OPEN COURT ON 4.12.2019. SD/- SD/- (H.S. SIDHU) (ANADEE NA TH MISSHRA) JUDICIAL MEMBER ACCOUNTANT MEM BER DATED: 04.12.2019 SH COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI