DCIT CIR 22(1), NAVI MUMBAI V. NEEL CONTROLS, MUMBAI

ITA 6910/MUM/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 3301 (ITAT-MUMBAI)
• Duration Of Justice: 2 year(s) 6 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-06-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 28-11-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: ABHINAV SHETH
• Keywords: Audit objection; Tax effect
• Section: 143(3); 12A; 2

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCH B , MUMBAI BEFORE SHRI MAHAVIR SINGH , JUDICIAL MEMBER AND SHRI RAJESH KUMAR , ACCOUNTANT MEMBER ITA NO. 6910 /MUM/201 3 : (A.Y : 20 10 - 11 ) DCIT, CIRCLE - 22(1), MUMBAI (APPELLANT) VS. M/S. NEEL CONTROLS 403, 4 TH FLOOR, SAPPHIRE ARCADE, 42 M.G. ROAD, RAJAWADI GHATKOPAR (E), MUMBAI 400 077. PAN : AA AFN0627J (RESPONDENT) APPELLANT BY : SHRI SANJEEV JAIN RESPONDENT BY : SHRI ABHINAV SHETH DATE OF HEARING : 30 /05/2016 DATE OF PRONOUNCEMENT : 06 /0 6 /2016 O R D E R PER RAJESH KUMAR , A M : THE CAPTIONED APPEAL IS FILED BY THE REVENUE AGAINST THE ORDER OF THE CIT(A) - 33 , MUMBAI DATED 02 /0 9 /201 3 , PERTAINING TO THE ASSESSMENT YEAR 2010 - 11, WHICH IN TURN HAS ARISEN FROM THE ORDER PASSED BY THE ASSESSING OFFICER DATED 05 /0 2 /2013 UNDER SECTION 143(3) OF THE INCOME TAX ACT, 1961 (IN SHORT THE ACT) . 2. THE CBDT VIDE CIRCULAR NO.21/2015 DATED 10/1 2/2015 HAS REVISED THE MONETARY LIMITS FOR FILING OF APPEALS BY THE DEPARTMENT BEFORE THE TRIBUNAL RETROSPECTIVELY. THE TAX EFFECT IN DISPUTE IN THE 2 M/S. NEEL CONTROLS ITA NO. 6910 /MUM/2013 CAPTIONED APPEAL IS STATED TO BE BELOW THE MONETARY LIMIT OF RS.10.00 LACS SPECIFIED IN THE CBDT CIRCULAR DATED 10/12/2015 (SUPRA). 3. IN THIS BACKGROUND, LD. DEPARTMENTAL REPRESENTATIVE APPEARING FOR THE REVENUE WAS REQUIRED TO STATE HIS POSITION. HE HAS NOT BROUGHT OUT ANY MATERIAL TO SUGGEST THAT THE CAPTIONED APPEAL IS PROTECTED BY ANY OF THE CIRCUMSTANC ES PRESCRIBED IN PARA - 8 OF THE CIRCULAR DATED 10/12/2015 (SUPRA) AND AS A CONSEQUENCE SUCH APPEAL IS LIABLE TO BE TREATED AS WITHDRAWN/NOT PRESSED. THE RELEVANT PORTION OF THE CIRCULAR DATED 10/12/2015 (SUPRA) IS REPRODUCED BELOW: - 3. HENCEFORTH APPEALS /SLPS SHALL NOT BE FILED IN CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY LIMITS GIVEN HEREUNDER: - SL. NO. APPEALS IN INCOME - TAX MATTERS MONETARY LIMITS (IN RS.) 1. BEFORE APPELLATE TRIBUNAL 10,00,000 2. BEFORE HIGH COURT 20,00,000 3. BEFORE SUPREME COURT 25,00,000 ............................................................................................................................. .......... 4. FOR THIS PURPOSE, 'TAX EFFECT' MEANS THE DIFFERENCE BETWEEN THE TAX ON THE TOTAL INCOME ASSESSED AND THE TAX THAT WOULD HAVE BEEN CHARGEABLE HAD SUCH TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME IN RESPECT OF THE ISSUES AGAINST WHICH APPEAL IS INTENDED TO BE FILED (HEREINAFTER REFERRED TO AS 'DISPUTED ISSUES'). HOWEVER THE TAX WIL L 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 EFFECT. IN CASES WHERE RETURNED LOSS IS REDUCED OR ASSESSED AS INCOME, THE TAX EFFECT WOULD INCLUDE NOTIONAL TAX ON DISPUTED ADDITIONS. IN CASE OF PENALTY ORDERS, THE TAX EFFECT WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE ORDER TO BE APPEALED AGAINST. . 3 M/S. NEEL CONTROLS ITA NO. 6910 /MUM/2013 8. ADVERSE JUDGMENTS RELATING TO THE FOLLOWING ISSUES SHOULD BE CONTESTED ON MERITS NOTWITHSTANDING THAT THE TAX EFFECT ENTAILED IS LESS THAN THE MONETARY LIMITS SPECIFIED IN PARA 3 ABOVE OR THERE IS NO TAX EFFECT: (A) WHERE THE CONSTITUTIONAL VALIDITY OF THE PROVISIONS OF AN ACT OR RULE ARE UNDER CHALLENGE, OR (B) WHERE BOARD'S ORDER, NOTIFICATION, INSTRUCTION OR CIRCULAR HAS BEEN HELD TO BE ILLEGAL OR ULTRA VIRES, OR (C) WHERE REVENUE AUDIT OBJECTION IN THE CASE HAS BEEN ACCEPTED BY THE DEPARTMENT, OR (D) WHERE THE ADDITION RELATES TO UNDISCLOSED FOREIGN ASSETS/ BANK ACCOUNTS. 9. THE MONETARY LIMITS SPECIFIED IN PARA 3 ABOVE SHALL NOT APPLY TO WRIT MATTERS AND DIRECT TAX MATTERS OTHER THAN INCOME TAX. FILING OF APPEALS IN OTHER DIRECT TAX MATTERS SHAL L CONTINUE TO BE GOVERNED BY RELEVANT PROVISIONS OF STATUTE & RULES. FURTHER, FILING OF APPEAL IN CASES OF INCOME TAX, WHERE THE TAX EFFECT IS NOT QUANTIFIABLE OR NOT INVOLVED, SUCH AS THE CASE OF REGISTRATION OF TRUSTS OR INSTITUTIONS UNDER SECTION 12A OF THE IT ACT, 1961, SHALL NOT BE GOVERNED BY THE LIMITS SPECIFIED IN PARA 3 ABOVE AND DECISION TO FILE APPEAL IN SUCH CASES MAY BE TAKEN ON MERITS OF A PARTICULAR CASE. 10. THIS INSTRUCTION WILL APPLY RETROSPECTIVELY TO PENDING APPEALS AND APPEALS TO BE FI LED HENCEFORTH IN HIGH COURTS/ TRIBUNALS. PENDING APPEALS BELOW THE SPECIFIED TAX LIMITS IN PARA 3 ABOVE MAY BE WITHDRAW N/ NOT PRESSED . APPEALS BEFORE THE SUPREME COURT WILL BE GOVERNED BY THE INSTRUCTIONS ON THIS SUBJECT, OPERATIVE AT THE TIME WHEN SUCH A PPEAL WAS FILED. (UNDERLINED FOR EMPHASIS BY US) 4. WITHOUT GOING INTO THE MERIT OF THE ISSUES RAISED IN THE CAPTIONED APPEAL, THIS APPEAL IS DEEMED TO BE WITHDRAWN/NOT PRESSED AS ITS FILING IS IN CONTRAVENTION OF THE CBDT CIRCULAR DATED 10/12/2015(SUPRA). 4 M/S. NEEL CONTROLS ITA NO. 6910 /MUM/2013 5 . IN CONCLUSION, BY APPLYING THE CBDT CIRCULAR DATED 10/12/2015(SUPRA), THE CAPTIONED APPEAL OF THE REVENUE IS DISMISSED AS WITHDRAWN/NOT PRESSED. ORDER PRONOUNCED IN THE OPEN COURT ON 6 T H JUNE , 2016. SD/ - SD/ - ( MAHAVIR SINGH ) JUDICIAL MEMBER ( RAJESH KUMAR ) ACCOUNTANT MEMBER MUMBAI, DATE : 6 T H JUNE , 2016 COPY TO : 1) THE APPELLANT 2) THE RESPONDENT 3) THE CIT(A) CONCERNED 4) THE CIT CONCERNED 5) THE D.R, B BENCH, MUMBAI 6) GUARD FILE BY ORDER DY./ASSTT. REGISTRAR *SSL* I.T.A.T, MUMBAI