Income Tax Officer, Ward-2(2), Jaipur V. M/s. VPS Business Consultancy Private Limited, Jaipur

ITA 738/JPR/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 4583 (ITAT-JAIPUR)
• Duration Of Justice: 2 month(s) 8 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-08-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 29-05-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: J C KULHARIJCIT
• Assessee Lawyers: ISHA KANOONGO
• Keywords: Tax effect
• Section: 56(2); 148; 56

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH FOT; IKY JKO ] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM VK;DJ VIHY LA-@ ITA NO. 738/JP/2018 FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2009-10 INCOME TAX OFFICER, WARD-2(2), JAIPUR. CUKE VS. M/S VPS BUSINESS CONSULTANCY PVT. LTD., B-17A, JAIPUR TOWER, OPP. ALL INDIA RADIO, JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AABCV9759R VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT IZR;K{KSI.K @ C.O. NO. 20/JP/2018 (ARISING OUT OF VK;DJ VIHY LA-@ ITA NO. 738/JP/2018) FU/KZKJ.K O'K Z @ ASSESSMENT YEAR 2009-10 M/S VPS BUSINESS CONSULTANCY PVT. LTD., B-17A, JAIPUR TOWER, OPP. ALL INDIA RADIO, JAIPUR CUKE VS. INCOME TAX OFFICER, WARD-2(2), JAIPUR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AABCV9759R IZR;K{KSID@ OBJECTOR IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS @ REVENUE BY : SHRI J. C. KULHARI(JCIT) FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : MS. ISHA KANOONGO (ADV.) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 06/08/2018 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT : 07/08/2018 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M.: THIS IS THE APPEAL FILED BY THE REVENUE AND THE CR OSS OBJECTION FILED BY THE ASSESSEE AGAINST THE ORDER OF THE LD. CIT(A) -1, JAIPUR DATED 23/03/2018 PERTAINING TO THE A.Y. 2009-10 WHEREIN T HE REVENUE AND THE ASSESSEE HAVE TAKEN FOLLOWING GROUNDS OF APPEAL: ITA 738/JP/2018 & C.O. 20/JP/2018_ ITO VS M/S VPS BUSINESS CONSULTANCY PVT. LTD., JAIP UR 2 GROUNDS OF REVENUES APPEAL: ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE A ND IN LAW THE LD. CIT(A)-1, JAIPUR HAS ERRED IN: 1. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WAS JUSTIFIED IN DELETING THE AD DITION OF RS. 59,40,000/- MADE BY THE AO ON ACCOUNT UNEXPLAINED C REDIT OF SHARE PREMIUM? 2. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WAS NOT JUSTIFIED IN IGNORING TH E FACT THAT THE ASSESSEE HAS DECLARED SHARE APPLICATION MONEY RECEI PT IN BALANCE SHEET FOR FY 2008-09 RELEVANT TO A.Y 2009-10? 3. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WAS NOT JUSTIFIED TO APPRECIATE THE FACTS THAT THE ASSESSEE HAS CREDITED THE SHARE APPLICATION MON EY DURING AY 2009-10 (IN BALANCE SHEET)? 4. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) WAS NOT JUSTIFIED IN IGNORING TH E FACTS THAT THE ASSESSEE HAS NOT FILED BANK STATEMENT AND CONFIRMAT IONS OF SHARE APPLICATION MONEY/SHARE PREMIUM RECEIVED DURING ASS ESSMENT PROCEEDING? GROUNDS OF ASSESSEES C.O.: 1. THAT UNDER THE FACTS AND CIRCUMSTANCES OF THE CA SE THE LEARNED CIT(A) HAS ERRED CONFIRMING THE ACTION OF THE ASSES SING OFFICER IN PASSING THE ORDER U/S 148/143(3) OF THE INCOME TAX, 1961 WHICH IS AB-INITIO VOID BEING IN VIOLATION OF THE PRINCIP LES OF EQUITY AND JUSTICE. 2. THAT UNDER THE FACTS AND CIRCUMSTANCES OF THE CA SE THE LEARNED CIT(A) HAS ERRED CONFIRMING THE ACTION OF THE ASSES SING OFFICER IN PASSING THE ORDER U/S 148/143(3) OF THE INCOME TAX ACT, 1961 IS BAD IN LAW AS THE SAME HAS BEEN PASSED WITHOUT FURN ISHING REASONS FOR ISSUING NOTICE U/S 148 DESPITE REQUEST BY THE ASSESSEE. ITA 738/JP/2018 & C.O. 20/JP/2018_ ITO VS M/S VPS BUSINESS CONSULTANCY PVT. LTD., JAIP UR 3 3. THAT UNDER THE FACTS AND CIRCUMSTANCES OF THE CA SE THE LEARNED CIT(A) HAS ERRED CONFIRMING THE ACTION OF THE ASSES SING OFFICER REGARDING APPLICABILITY OF SECTION 56(1) & 56(2) OF THE INCOME TAX ACT, 1961 ARE IRRELEVANT AND NON-EXISTENT. THE PROV ISIONS OF SECTION 56 ARE NOT APPLICABLE TO THE FACTS OF THE C ASE EVEN DISTANTLY. 2. FIRSTLY, WE WILL TAKE UP THE CROSS OBJECTION FIL ED BY THE ASSESSEE WHEREIN IT HAS CHALLENGED THE ACTION OF THE ASSESSI NG OFFICER IN ISSUING THE NOTICE U/S 148 OF THE INCOME TAX ACT, 1961 (IN SHOR T THE ACT). 2.1 AT THE OUTSET OF HEARING, THE LD AR OF THE ASSE SSEE HAS NOT PRESSED THE GROUNDS OF THE C.O., THEREFORE, THE SAME STANDS DISMISSED AS NOT PRESSED. 3. NOW WE TAKE THE REVENUES APPEAL. AT THE TIME OF HEARING, THE LD. AR OF THE ASSESSEE HAS RAISED AN OBJECTION OF MAINT AINABILITY OF THE APPEAL OF THE REVENUE DUE TO THE TAX EFFECT NOT EXCEEDING RS. 20 LACS AS PER THE CBDT CIRCULAR NO. 3 OF 2018 DATED 11 TH JULY, 2018. 3.1. THE LD. D/R HAS FAIRLY SUBMITTED THAT THE TAX EFFECT INVOLVED IN THE REVENUES APPEAL COMES TO RS 18,35,460/- LESS THAN RS 20 LACS WHICH IS PRESCRIBED THRESHOLD LIMIT IN TERMS OF THE CBDT CIR CULAR NO. 3/2018 DATED 11 TH JULY, 2018 ISSUED IN SUPERSESSION OF ITS EARLIER C IRCULAR NO. 21 OF 2015 DATED 10.12.2015. 4. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORD. IT IS OBSERVED THAT THE DEMAN D/ TAX EFFECT IN THE REVENUES APPEAL IN QUESTION IS BELOW RS. 20.00 LAC S. UNDER THE POWERS VESTED BY SECTION. 268A(1) OF THE IT ACT, CBDT HAS RECENTLY ISSUED CIRCULAR NO. 3/2018 DATED 11TH JULY, 2018 (F NO. 27 9/MISC. 142/2007- ITJ(PT) INSTRUCTING THE AUTHORITIES BELOW THAT DEPA RTMENTAL APPEAL SHOULD ITA 738/JP/2018 & C.O. 20/JP/2018_ ITO VS M/S VPS BUSINESS CONSULTANCY PVT. LTD., JAIP UR 4 NOT BE FILED BEFORE ITAT WHERE THE DEMAND/TAX EFFEC T DOES NOT EXCEED RS. 20 LACS. THE CIRCULAR IS SPECIFICALLY MENTIONED TO BE APPLICABLE FOR ALL PENDING APPEALS. 5. SUBJECT TO SOME EXCEPTIONS, IT IS FURTHER DIREC TED BY CBDT THAT ALL THE DEPARTMENTAL APPEALS PENDING BEFORE ITAT WHERE THE DEMAND/TAX EFFECT IS NOT EXCEEDING THAN 20 LACS SHOULD BE EITH ER WITHDRAWN OR NOT PRESSED BY THE DEPARTMENTAL REPRESENTATIVES. 6. THE PRESENT APPEAL IS NOT COVERED BY ANY EXCEPT IONS MENTIONED IN THE SAID CBDT CIRCULAR. SINCE THE TAX DEMAND IN DI SPUTE IN THIS DEPARTMENTAL APPEAL IS BELOW THE LIMIT SET OUT BY C BDT FOR THE APPEAL, THE APPEAL OF THE ASSESSEE IS NOT MAINTAINABLE IN VIEW OF CBDT CIRCULAR NO. 3 OF 2018 DATED 11.07.2018. ACCORDINGLY THE APPEAL OF THE REVENUE IS DISMISSED AS NOT PRESSED/WITHDRAWN. 7. IN THE RESULT, BOTH THE APPEAL OF THE REVENUE AN D THE C.O. OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 07/08/2018 SD/- SD/- FOT; IKY JKO FOE FLAG ;KNO (VIJAY PAL RAO) (VIKRAM SINGH YADAV ) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 07/08/2018 *GANESH KR. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- THE ITO, WARD-2(2), JAIPUR. ITA 738/JP/2018 & C.O. 20/JP/2018_ ITO VS M/S VPS BUSINESS CONSULTANCY PVT. LTD., JAIP UR 5 2. IZR;FKHZ@ THE RESPONDENT- M/S VPS BUSINESS CONSULTANCY PVT. LTD., JAIPUR 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR 6. XKMZ QKBZY@ GUARD FILE (ITA NO. 738/JP/2018 & CO 20/JP/2018) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR