ITO, Meerut V. Sh. Ankur Singhal, Meerut

ITA 6443/DEL/2015

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 6772 (ITAT-DELHI)
• Duration Of Justice: 10 month(s) 24 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 28-10-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 20-10-2016
• Assessment Year: 2010-2011
• Appeal Filed On: 04-12-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMRIT LAL SENIOR
• Keywords: Retrospective amendment; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL (DELHI BENCH C : NEW DELHI) BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI ANADI N MISHRA, ACCOUNTANT MEMBER ITA NO.6443/DEL./2015 (ASSESSMENT YEAR : 2010-11) INCOME TAX OFFICER, VS. SHRI ANKUR SINGHAL, WARD 1 (1), PROP. M/S. SPACEDEK, MEERUT. 36, KISHANPURI, MEERUT. (PAN : AJRPS2367Q) (APPELLANT) (RESPONDENT) ASSESSEE BY : SHRI SANDEEP SAPRA, ADVOCATE REVENUE BY : SHRI AMRIT LAL, SENIOR DR DATE OF HEARING : 20.10.2016 DATE OF ORDER : 28.10.2016 O R D E R PER ANADI N MISHRA : THE APPELLANT, INCOME TAX OFFICER, WARD 1 (1), MEE RUT (HEREINAFTER REFERRED TO AS THE REVENUE) BY FILIN G THE PRESENT APPEAL SOUGHT TO SET ASIDE THE IMPUGNED ORDER DATED 08.09.2015 PASSED BY THE COMMISSIONER OF INCOME-TAX (APPEALS), MEERUT FOR THE ASSESSMENT YEAR 2010-11 ON THE FOLLOWING GROUND S :- 1. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE C ASE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS), MEERUT HAS ER RED IN LAW AND ON FACT IN DELETING THE ADDITION OF RS.13,61,72 3 MADE BY THE AO. ON THE BASIS OF GROSS PROFIT WORKED OUT BY HIM SINCE THE ITA NO.6443/DEL./2015 2 BOOKS OF ACCOUNTS WERE REJECTED BY HIM U/S 145(3) O F THE I.T. ACT, 1961, AS THERE WAS A GROSS DISCREPANCY IN THE SALES PRICES OF THE GOODS AND PROFITS EARNED ON SALES MADE IN 1 ST AND 2 ND HALVES OF THE YEAR AND THIS VARIATION IS NOT POSSIBLE IN SAME TRA DE OF SIMILAR ITEMS DURING THE SAME YEAR. 2. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS), MEERUT HAS ER RED IN LAW AND FACT IN DELETING THE ADDITION OF RS.37,807/- WH ICH HAD BEEN MADE BY THE A.O. ON PROPORTIONATE BASIS AS INTEREST WHICH HAD NOT BEEN CHARGED ON LOANS ADVANCED BY THE ASSESSEE. 3. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS), MEERUT HAS ER RED IN LAW IN DELETING THE ADDITION OF RS.40,289/- MADE BY THE AO ON ACCOUNT OF DISALLOWANCE OF 10% OF VARIOUS EXPENSES DEBITED IN THE P & L A/C WITHOUT CONSIDERING THE FACT THAT THE BOOKS OF ACCOUNTS HAD BEEN REJECTED BY THE AO AND THE VARIOUS VOUCHERS PR ODUCED BY THE ASSESSEE WERE EITHER SELF MADE OR WERE NOT FOUND TO BE SATISFACTORILY MADE FOR WHICH THE ASSESSEE COULD NO T FURNISH ANY SATISFACTORY REPLY. 4. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE LD. COMMISSIONER OF INCOME TAX (APPEALS), MEERUT HAS ER RED IN LAW AND IN FACTS IN DELETING THE ADDITION OF RS.1,38,3 25/- MADE BY THE AO. ON ACCOUNT OF DISALLOWANCE OF DEDUCTION U/S 80I C OF THE I.T. ACT, 1961, WITHOUT CONSIDERING THE FACT THAT THE AS SESSEE DID NOT PRODUCE INSPECTION REPORTS OF GOVERNMENT DEPARTMENT S IN RESPECT OF MATERIALS PURCHASED BY THEM AND ALSO DETAILS OF SCRAP SALE DURING THE RELEVANT AY., INSPITE OF OPPORTUNITY HAV ING BEEN GRANTED TO HIM TO PRODUCE THE SAME, CAUSING THE A.O . TO DRAW THE CONCLUSION THAT NO MANUFACTURING ACTIVITY WAS CARRI ED OUT BY THE ASSESSEE DURING THE SAID PREVIOUS YEAR. 5. WHETHER IN THE FACTS AND CIRCUMSTANCES OF THE CA SE, THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEAL S), MEERUT MAY BE SET ASIDE AND THAT OF THE AO BE RESTORED. 6. THAT THE APPELLANT CRAVES LEAVE TO ADD, MODIFY A ND/OR DELETE ANY GROUNDS OF APPEAL. 2. WHEN THE APPEAL CAME UP FOR HEARING, THE LD. AU THORISED REPRESENTATIVE OF THE RESPONDENT ASSESSEE CONTENDED AT THE OUTSET THAT TAX EFFECT IN THIS APPEAL WAS BELOW RS.10 LAKH S. HE ALSO DREW OUR ATTENTION TO CBDT INSTRUCTION NO.21/2015 DATED 10 TH ITA NO.6443/DEL./2015 3 DECEMBER, 2015 IN WHICH REVENUE HAS BEEN DIRECTED N OT TO FILE ANY APPEAL IN INCOME TAX APPELLANT TRIBUNAL IF TAX EFFECT IS LESS THAN RS.10,00,000/-. THE LD. AUTHORISED REPRESENTA TIVE CONTENDED THAT THE APPEAL OF THE REVENUE MAY BE DISMISSED IN THE LIGHT OF CBDT CIRCULAR (SUPRA). THE LD. DEPARTMENTAL REPRES ENTATIVE APPEARING FOR REVENUE AGREED THAT THE TAX EFFECT IN THIS APPEAL FILED BY REVENUE IS LESS THAN RS.10 LAKHS. HE ALSO AGREE D THAT AFORESAID INSTRUCTION OF CBDT DATED 10.12.2015 WAS APPLICABLE IN THIS APPEAL; AND AGREED THAT THE APPEAL HAS BECOME INFRU CTUOUS IN VIEW OF THIS CBDT INSTRUCTION. 3. WE HAVE HEARD PARTIES ON THE ISSUE IN CONTROVER SY AND PERUSED THE MATERIAL ON RECORD. PERUSAL OF CBDT CIR CULAR (SUPRA) SHOWS THAT MONETARY LIMIT FOR FILING THE APPEAL BY THE DEPARTMENT BEFORE THE TRIBUNAL, HON'BLE HIGH COURT AND HON'BLE SUPREME COURT HAS BEEN REVISED AND THE RELEVANT PORTION OF THE AFORESAID CIRCULAR IS EXTRACTED 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 (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 PRESCR IBED ABOVE. FILING OF APPEAL IN SUCH CASES IS TO BE DECIDED ON MERITS OF THE CASE. ITA NO.6443/DEL./2015 4 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 AB OVE MAY BE WITHDRAWN / NOT PRESSED. APPEALS BEFORE THE SUPREME COURT WILL BE GOVERNED BY THE INSTRUCTIONS ON THIS SUBJECT, OPERA TIVE AT THE TIME WHEN SUCH APPEAL WAS FILED.' 4. IN VIEW OF THE CBDT CIRCULAR NO.21 DATED 10.12. 2015 HAVING RETROSPECTIVE EFFECT AND WHAT HAS BEEN DISCU SSED ABOVE, WE ARE OF THE CONSIDERED VIEW THAT THE AFORESAID APPEA L IS NOT MAINTAINABLE BECAUSE OF LOW TAX EFFECT I.E. LESS TH AN RS.10,00,000/- HENCE, THE AFORESAID APPEAL FILED BY THE REVENUE IS HEREBY DISMISSED IN LIMINE HAVING BEEN BECOME INFRUCTUOUS. HOWEVER, IN CASE ANY FACT WHICH IS OTHERWISE NOT ON RECORD, WAR RANTS THE RESTORATION OF THE PRESENT APPEAL, THE REVENUE IS A T LIBERTY TO APPROACH THE TRIBUNAL UNDER RELEVANT PROVISIONS OF LAW. ORDER PRONOUNCED IN OPEN COURT ON THIS 28 TH DAY OF OCTOBER, 2016. SD/- SD/- (H.S. SIDHU) (ANADI N MISHRA) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED THE 28 TH DAY OF OCTOBER, 2016 TS ITA NO.6443/DEL./2015 5 COPY FORWARDED TO: 1.APPELLANT 2.RESPONDENT 3.CIT 4.CIT(A), MEERUT. 5.CIT(ITAT), NEW DELHI. AR, ITAT NEW DELHI.