ACIT 2(3), MUMBAI V. UNION ENTERPRISES P.LTD, MUMBAI

ITA 613/MUM/2014

• Counselvise Citation: [2015] 121 COUNSELVISE.COM (IT) 0990 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 5 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 02-07-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2010-2011
• Appeal Filed On: 24-01-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL F BENCH, MUMBAI . . , , , BEFORE SHRI A.D. JAIN , JUDICIAL MEMBER AND SHRI N.K . BILLAIYA, A CCOUNTANT M EMBER / I .T.A. NO . 613/MUM/2014 ( / ASSESSMENT YEAR : 2010 - 11 THE ACIT 2(3), AAYAKAR BHAVAN, MUMBAI - 400 020 / VS. M/S. UNION ENTERPRISE PVT. LTD., 113, NAGINDAS MASTER ROAD, FORT, MUMBAI - 400 023 ./ ./ PAN/GIR NO. : AAACU 2858B ( / APPELLANT ) .. ( / RESPONDENT ) / APPELLANT BY: SHRI SUNIL KUMAR AGARWAL / RESPONDENT BY : SHRI KIRIT SANGHVI / DATE OF HEARING : 02 . 0 7 .2015 / DATE OF PRONOUNCEMENT : 02 .0 7 .2015 / O R D E R PER N.K. BILLAIYA, AM: THIS IS AN APPEAL BY THE REVENUE PREFERRED AGAINST THE ORDER OF THE LD. CIT(A) - 6 , MUMBAI DT. 18 . 10 .201 3 PERTAINING TO ASSESSMENT YEAR 20 1 0 - 1 1 . 2. THE GROUNDS OF APPEAL READ AS UNDER: ITA. NO. 613/M/2014 2 ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LEARNED CIT(A) HAS ERRED IN ALLOWING RELIEF TO THE AS SESSEE TO THE EXTENT IMPUGNED IN THE GROUNDS ENUMERATED BELOW: 1. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD. CIT(A) ERRED IN DELETING THE ADDITION ON ACCOUNT OF RETENTION MONEY OF RS.5.36 LAKHS ON THE GROUND THAT SAME IS DUE ONLY AFTER PUMPS SATISFACTORY PERFORMANCE AND IS OFFERED TO TAX IN SUBSEQUENT YEARS WITHOUT APPRECIATING THAT THE ASSESSEE IS FOLLOWING MERCANTILE SYSTEM OF ACCOUNTING AND HAD TO BOOK SALES ON ACCRUAL BASIS EVEN THOUGH 10% AMOUNT WAS NOT DUE. 2. ON THE FACTS A ND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD.CIT(A) ERRED IN DELETING THE DISALLOWANCE OF RS. 4,49,230/ - U/S 40(A)(IA) OF THE IT ACT WITHOUT APPRECIATING THAT THE AGGREGATE PAYMENT MADE BY THE ASSESSEE EXCEEDS RS.75,000/ - IN THE FINANCIAL YEARS A ND ALSO PAN DETAILS WERE NOT PROVIDED. HENCE, AS PER PROVISION OF SECTION 194C(5) OF THE IT ACT TDS WAS DEDUCTIBLE ON THE SAID AMOUNT. 2. AS IT CAN BE SEEN FROM THE GROUNDS OF APPEAL , THE TAX EFFECT WOULD BE LESS THAN RS.4.00 LACS. VIDE CBDT INSTRUCTION NO.5/2014 F.NO.279/MISC.142/2007 - ITJ(PT)] DATED 10/07/2014, THE TAX EFFECT LIMIT FOR FILING THE APPEAL BEFORE THE TRIBUNAL BY THE REVENUE WAS ENHANCED FROM RS.3.00 LACS TO RS.4.00 LACS. 4. WE HAVE CONSIDERED THE SUBMISSIONS OF BOTH THE PARTIES. HOWEVER, ACCORDING TO FOLLOWING DECISIONS OF HONBLE JURISDICTIONAL HIGH COURT, SUCH NOTIFICATIONS ISSUED UNDER SECTION 268A WOULD BE APPLICABLE EVEN TO THE APPEALS FILED BEFORE ISSUE OF THE NOTI FICATION IF THE LIMIT IS ENHANCED: (I) IN THE CASE OF CIT VS. SMT. VIJAYA KAVEKAR (2013 ) 30 TAXMANN.COM 412) IT WAS HELD AS UNDER: ITA. NO. 613/M/2014 3 SECTION 260A, READ WITH SECTION 268A, OF THE INCOME - TAX ACT, 1961 - HIGH COURT - APPEALS TO - TAX EFFECT - WHETHER INSTRUCTION NO. 3 OF 2011, DATED 9 - 2 - 2011, SPECIFYING MONETARY LIMIT OF RS. 10 LAKHS FOR MAINTAINABILITY OF APPEAL BEFORE HIGH COURT IS APPLICABLE ON PENDING APPEALS AS WELL - HELD, YES - WHETHER, THEREFORE, WHERE TAX EFFECT IN REVENUES APPEALS WAS LESS T HAN RS. 10 LAKHS WHICH WAS FILED EVEN PRIOR TO ISSUE OF INSTRUCTION DATED 9 - 2 - 2011, SAME WAS TO BE DISMISSED BEING NON - MAINTAINABLE - HELD, YES [IN FAVOUR OF ASSESSEE ] (II) . IN THE CASE OF CIT VS. MADHUKAR IMANDAR (2009 185 TAXMAN 101] IT WAS HELD AS UN DER: SECTION 268A, READ WITH SECTION 119, OF THE INCOME - TAX ACT, 1961 - APPEAL OR APPLICATION FOR REFERENCE - FILING OF, BY INCOME - TAX AUTHORITY - WHETHER CIRCULAR/INCOME - TAX INSTRUCTION NO. 5 OF 2008, DATED 15 - 5 - 2008 ISSUED BY CBDT DIRECTING INCOME - TAX A UTHORITIES NOT TO FILE APPEALS IF TAX EFFECT IS LESS THAN RS. 4 LAKHS WOULD BE APPLICABLE TO CASES PENDING BEFORE HIGH COURT AS ON 15 - 5 - 2008 EITHER FOR ADMISSION OR FOR FINAL DISPOSAL, EVEN THOUGH SAID APPEALS AND/OR PETITIONS WERE FILED BEFORE HIGH COURT PRIOR TO 15 - 5 - 2008 - HELD, YES 5. IN THIS VIEW OF THE SITUATION, WE DISMISS THE APPEAL FILED BY THE REVENUE ON ACCOUNT OF LOW TAX EFFECT AS PER AFOREMENTIONED INSTRUCTION ISSUED BY CBDT. OR DER PRONOUNCED IN THE OPEN COURT ON 2 ND JULY , 2015 SD/ - SD/ - ( A.D. JAIN ) (N.K. BILLAIYA) /JUDICIAL MEMBER / ACCOUNTANT MEMBER MUMBAI ; DATED : 2 ND JU LY , 2015 . . ./ RJ , SR. PS ITA. NO. 613/M/2014 4 / 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./ASSTT. REGISTRAR) , / ITAT, MUMBAI