ACIT, Circle-2, V. Eastern Technopinz Pvt. Ltd., Nashik

ITA 747/PUN/2008

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 56604 (ITAT-PUNE)
• Duration Of Justice: 3 year(s) 7 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-12-2011
• Appeal Filed By: Department
• Bench Allotted: Not Allotted
• Assessment Year: 2004-2005
• Appeal Filed On: 03-05-2008
• Court: TRIBUNAL
• Keywords: Question of law; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL PUNE BENCH B PUNE BEFORE SHRI I.C. SUDHIR, J.M. AND SHRI D. KARUNAKARA RAO, A.M. I.T.A. NO. 747/PN/2008 : A.Y. 2004-05 ASSTT. CIT CIR. 2, NASIK .. APPELLA NT VS. ESSEM TECHNOPINZ PVT. LTD., A-22 MIDC SATPUR, NASIK PAN AAKFS 9999Q .. RESPONDENT I.T.A. NO. 748/PN/2008 : A.Y. 2004-05 ASSTT. CIT CIR. 2, NASIK .. APPELLA NT VS. ESSEM TIPS PVT. LTD., A-22 MIDC SATPUR, NASIK PAN AAACE 3997 M .. RESPONDENT APPELLANTS BY: MS. NEERA MALHOTRA. RESPONDENT BY: SHRI PRAMOD SHINGTE DATE OF HEARING : 9-12-2011 DATE OF PRONOUNCEMENT: ___12-2011 ORDER PER D. KARUNAKARA RAO, AM BOTH THESE APPEALS BY THE REVENUE ARE DIRECTED AGA INST SEPARATE ORDERS OF THE CIT(A)-II NASIK IDENTICALLY DATED 27-3-2008 FOR A.Y. 2004-05. 2. AT THE OUTSET OF HEARING, THE LEARNED REPRESENT ATIVE FOR THE ASSESSEE RAISED A PRELIMINARY OBJECTION BY POINTING OUT INST RUCTION NO. 3/2011 DATED 09.02.2011 ISSUED BY THE CENTRAL BOARD OF DIRECT TA XES (CBDT) FIXING THE MONETARY LIMITS FOR FILING OF DEPARTMENTAL APPEALS BEFORE THE TRIBUNAL. IN TERMS OF THE SAID INSTRUCTION, MONETARY LIMIT FOR FILING DEPARTMENTAL APPEAL TO THE TRIBUNAL HAS BEEN FIXED AT RS 3 LAKHS. IN OTHER WOR DS, IN CASES WHERE THE TAX EFFECT OF THE ADDITIONS DELETED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) IS LESS THAN RS 3 LAKHS, NO APPEAL SHALL BE FILED BY T HE DEPARTMENT IN SUCH CASES. ACCORDING TO THE LEARNED REPRESENTATIVE, THE TAX EF FECT WITH RESPECT TO THE RELIEF ALLOWED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) IN THE CAPTIONED APPEALS IS BELOW RS 3 LAKHS. SUCH FACTUAL MATRIX HAS NOT BE EN CONTESTED BY THE LEARNED DEPARTMENTAL REPRESENTATIVE FOR THE REVENUE, THOUGH THE RELIEF ALLOWED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) IS SOUGHT TO B E ASSAILED ON MERITS. ITA NO. 747 & 748/PN/2008 ESSEM TECHNOPINZ AND ESSEM TIPS A.Y. 2004-05 2 3. WE FIND THAT IN A RECENT DECISION, THE CO-ORDINA TE BENCH OF ITAT MUMBAI, IN THE CASE OF ITO V SHRI ASHOK G. DHANDHARIAI, MUM BAI IN ITA NO2460/MUM/2010 DATED 28.2.2011 HELD THAT THE REVIS ED INSTRUCTIONS DATED 9.2.2011 (SUPRA) ARE APPLICABLE TO THE PRESENT CASE S ALSO, ALTHOUGH SUCH APPEALS HAVE BEEN FILED ON A PRIOR DATE. 4. IN VIEW OF THE PRECEDENT BROUGHT OUT BY THE LEAR NED REPRESENTATIVE FOR THE RESPONDENT, FACTUALLY THE DEPARTMENTAL APPEALS ARE LIABLE TO BE CONSIDERED TO HAVE BEEN FILED CONTRARY TO THE CBDT INSTRUCTIONS D ATED 9.2.2011 (SUPRA). THE TRIBUNAL FOLLOWING THE JUDGMENT OF THE HONBLE BOMB AY HIGH COURT IN THE CASE OF CIT V MADHUKAR K. INAMDAR (HUF) 318 ITR 149 AND CIT V PITHWA ENGINEERING WORKS 276 ITR 519 (BOM) FOUND IT APPROPRIATE TO DIS MISS THE DEPARTMENTAL APPEAL ON THE GROUND THAT TAX EFFECT IS LESS THAN R S 3 LAKHS, EVEN IN A CASE WHERE THE DEPARTMENTAL APPEALS WERE FILED PRIOR TO THE DATE OF THE CBDT INSTRUCTION DATED 9.2.2011 (SUPRA). THE FOLLOWING D ISCUSSION IN THE ORDER IS WORTHY OF NOTICE: 5. WE HEARD BOTH THE PARTIES. THE CASE OF CIT VS. CHHAJER PACKAGING & PLASTICS PVT. LTD. 300 ITR RELIED ON BY THE DR IS DISTINGUISHABLE FROM THE FACTS OF THE PRESENT CASE. AT PARA 12 PAGE 184 OF T HE DECISION IN THE CASE OF CHHAJER PACKAGING & PLASTICS PVT. LTD. IT HAS BE EN HELD AS FOLLOWS: OTHERWISE ALSO, PARAGRAPH OF THIS CIRCULAR ITSELF SAVES CERTAIN APPEALS FROM BEING OBSTRUCTED DUE TO FINANCIAL LIMI TS. PARAGRAPH 3 READS: THE BOARD HAS ALSO DECIDED THAT IN CASES INVOLVING SUBSTANTIAL QUESTION OF LAW OF IMPORTANCE AS WELL A S IN CASES WHERE THE SAME QUESTION OF LAW WILL REPEATEDLY ARIS E, EITHER IN THE CASE CONCERNED OR IN SIMILAR CASES, SHOULD B E SEPARATELY CONSIDERED ON THE MERITS WITHOUT BEING H INDERED BY THE MONETARY LIMITS. IT IS EVIDENT THAT, WHENEVER THERE IS A SUBSTANTIAL QUESTION OF LAW, OR QUESTION OF LAW WHICH IS LIKELY TO RECUR IN FUTU RE, THE DEPARTMENT IS NOT PROHIBITED FROM FILING AND PURSUING APPEALS. WE BELIEVE THAT THE SAVING CLAUSE SAVES THE PRESENT APPEAL SINCE IT INVOLVES A QUESTION OF LAW REGARDING INTERPRETATION OF SECTION 275(1)(C) OF THE ACT, AND MORE PARTICULARLY THE ASPECT OF MANNER IN WHICH THE LIMITATION SHOULD BE COMPUTED IN THE LIGHT OF THE S AID PROVISIONS. WE HAVE, THEREFORE, PROCEEDED TO HEAR THE ADVOCATES ON THE MERITS. IN OUR OPINION, THE CASE OF CIT V CHHAJER WAS WITH RESPECT OF INTERPRETATION OF 275(1)(C) OF THE ACT AND HENCE CA ME UNDER THE EXCEPTION CLAUSE UNDER THE CBDT CIRCULAR AND WAS NO T OBSTRUCTED BY THE MONETARY LIMIT OF RS 3 LAKHS PRESCRIBED BY T HE CIRCULAR. THEREFORE THE CASE OF 300 ITR 180 IS INAPPLICABLE T O THE FACTS OF OUR CASE. FURTHER INSTRUCTION NO. 5 DT. 15.5.2008 F IXING THE MONETARY LIMIT AT RS 2 LAKHS IS SIMILAR TO THAT OF INSTRUCTION NO. 3 DATED 9.2.2011 WHICH THE ASSESSEE HAS BROUGHT TO OU R NOTICE IN SUPPORT OF HIS CONTENTION. SINCE BOTH THE INSTRUCTI ON NOS. 5 & 3 ARE IDENTICAL, THE RATIO OF THE DECISION IN THE CASE OF CIT V PITHWA ENGG. ITA NO. 747 & 748/PN/2008 ESSEM TECHNOPINZ AND ESSEM TIPS A.Y. 2004-05 3 WORK WHICH DEALS WITH INSTRUCTION NO. 5 DT. 15.5.20 08 SHALL EQUALLY APPLY TO THE PRESENT CASE WHICH FALLS UNDER INSTRUC TION NO. 3 DATED 9.2.2011. FOLLOWING THE RATIO OF THE DECISION IN T HE CASE OF CIT V PITHWA ENGG. WORK WHEREIN IT HAS BEEN HELD THAT IN OUR VIEW, THE BOARDS CIRCULAR DT. 27 TH MARCH, 2000 IS VERY MUCH APPLICABLE EVEN TO THE OLD REFERENCES WHICH ARE STILL UNDECIDED, W E DISMISS THE DEPARTMENTAL APPEAL ON THE GROUND THAT THE TAX EFFE CT IS LESS THAN 3 LAKHS. FOLLOWING THE AFORESAID PRECEDENT, THE CAPTIONED AP PEALS FILED BY THE REVENUE ARE LIABLE TO BE DISMISSED IN VIEW OF CBDT INSTRUCT ION NO. 3 DATED 9.2.2011 (SUPRA) AS THE TAX EFFECT WITH RESPECT TO THE QUANT UM OF RELIEF ALLOWED BY THE COMMISSIONER OF INCOME-TAX (APPEALS) IS BELOW RS 3 LAKHS AND IT HAS NOT BEEN SHOWN THAT THE APPEALS FALL UNDER ANY OF THE EXCEPT IONS PROVIDED IN PARA 8 OF THE CBDT INSTRUCTION (SUPRA). WE ORDER ACCORDINGLY. 5. IN THE RESULT, THE APPEALS BY THE REVENUE ARE DI SMISSED. DECISION IS PRONOUNCED IN THE OPEN COURT ON 16-12-2 011. SD/- SD/- (I.C. SUDHIR) (D. KARUNAKARA RAO) JUDICIAL MEMBER ACCOUNTANT MEMBER PUNE DATED THE 16 TH DECEMBER 2011. ANKAM COPY OF THE ORDER FORWARDED TO : 1. ASSESSEE 2. DEPARTMENT 3. CIT(A)-II NASIK 4. CIT-I NASIK 5. THE D.R, PUNE BENCH B TRUE COPY BY ORDER SENIOR PRIVATE SECRETARY ITAT, PUNE BENCH, PUNE