DCIT, New Delhi V. M/s. Central Electronics Ltd., New Delhi

ITA 763/DEL/2014

• Counselvise Citation: 76320114 RSA 2014
• Duration Of Justice: 1 year(s) 4 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 22-06-2015
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Next Hearing Date: 22-06-2015
• Assessment Year: 2007-2008
• Appeal Filed On: 10-02-2014
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ROBIN RAWAL
• Keywords: Tax effect

Judgement Text

1 ITA NO. 763/DEL/2014 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH: SMC NEW DELHI BEFORE SHRI S. V. MEHROTRA, ACCOUNTANT MEMBER I.T.A .NO.-763/DEL/2014 (ASSESSMENT YEAR-2007-08) DCIT CIRCLE-3(1) NEW DELHI (APPELLANT) VS CENTRAL ELECTRONICS LTD. 781, DESH BANDHU GUPTA ROAD, KAROL BAGH, NEW DELHI AAACC1261G (RESPONDENT) APPELLANT BY SH. ROBIN RAWAL, JCIT RESPONDENT BY SH. R. S. SINGHVI, CA ORDER PER S.V. MEHROTRA, AM THE APPEAL, PREFERRED BY THE DEPARTMENT, IS DIRECTE D AGAINST THE ORDER DATED 27/11/2013 PASSED BY THE CIT(APPEALS), VIII, NEW DE LHI IN APPEAL NO. 0271/2011-12 RELATING TO ASSESSMENT YEAR 2007-08. THE SOLE EFFECTIVE GROUND RAISED IS AS UNDER:- 1. WHETHER THE LD. CIT(A) HAS ERRED IN LAW AND ON THE FACTS IN DELETING THE ADDITION AMOUNTING TO RS.13,00,194/- ON ACCOUNT OF PRIOR PERIOD EXPENSES MADE BY THE A.O BY IGNORING THE FACT THAT HE HAS RIGHTLY9 ADDED BACK THE EXPENSES AS ACCORDING TO MERCANTILE SYSTEM OF ACCOUNTING, EXPENDITURE SHOULD BE WRITTEN IN P &L I N THE YEAR THEY ARE INCURRED NOT AFTERWARD. DATE OF HEARING 22.06.2015 DATE OF PRONOUNCEMENT 22.06.2015 2 ITA NO. 763/DEL/2014 2. THE LD. COUNSEL FOR THE ASSESSEE AT THE VERY OUT SET FILED BEFORE US A CALCULATION OF TAX EFFECT WHICHI IS REPRODUCED HERE UNDER:- CALCULATION OF TAX EFFECT AMOUNT (RS.) ADDITION DISPUTED BEFORE TRIBUNAL 13,00,194/- TAX @ 30.6%(INCL. CESS) 3,97,859/- 3. ACCORDINGLY, HE CONTENDED THAT THE TAX EFFECT IN VOLVED IN PRESENT APPEAL IS BELOW RS.4 LAKHS AND, THEREFORE, THE APPEAL FILED BY THE REVENUE IS NOT MAINTAINABLE IN VIEW OF RECENT CBDT INSTRUCTION WHI CH IS BINDING ON THE DEPARTMENTS. LD. DR DID NOT DISPUTE THE CALCULATIO N OF TAX EFFECT SUBMITTED BY THE ASSESSEE. 4. I HAVE HEARD RIVAL SUBMISSIONS OF THE PARTIES A ND PERUSED THE ENTIRE MATERIAL ON RECORD. AS PER RECENT CBDT INSTRUCTION NO. 5/20 14 DATED 10/7/2014, THE MONETARY LIMIT FOR FILING APPEAL BY THE DEPARTMENT BEFORE THE ITAT HAS BEEN REVISED TO RS. 4 LACS. THUS, THE DEPARTMENTAL APPE ALS, INVOLVING TAX EFFECT BELOW RS. 4 LACS, ARE NOT MAINTAINABLE BEFORE THE ITAT. 4.1. THE HONBLE JURISDICTIONAL HIGH COURT IN THE C ASE OF CIT VS. DELHI RACE CLUB LTD. IN ITA NO. 128/2008, ORDER DATED 03/03/20 11, BY FOLLOWING THE EARLIER ORDER DATED 2/8/2010 IN ITA NO. 179/1991 IN THE CAS E OF CIT DELHI-III VS. M/S P. S. JAIN & CO., HAS HELD THAT SUCH INSTRUCTION/CIRCU LAR WOULD ALSO BE APPLICABLE TO PENDING CASES. 4.2. ADMITTEDLY THE TAX EFFECT INVOLVED IN THE PRES ENT APPEAL IS BELOW RS. 4 LAKHS. THEREFORE, IN VIEW OF THE REVISED INSTRUCTION OF TH E CBDT, REFERRED TO ABOVE, AND THE HONBLE JURISDICTIONAL HIGH COURTS DECISION IN THE CASE OF DELHI RACE CLUB LTD., SUPRA, THE DEPARTMENTAL APPEAL IS NOT MAINTAI NABLE. 5. IN THE RESULT, DEPARTMENTAL APPEAL IS DISMISSED. 3 ITA NO. 763/DEL/2014 THE ORDER IS PRONOUNCED IN THE OPEN COURT ON 22 OF JUNE 2015. SD/- (S. V. ME HROTRA) ACCOUNTANT MEMBER DATED:- 22/06/2015 *R. NAHEED* COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT A SSISTANT REGISTRAR ITAT NEW DELHI DATE 1. DRAFT DICTATED ON 22.06.2015 PS 2. DRAFT PLACED BEFORE AUTHOR .06.2015 PS 3. DRAFT PROPOSED & PLACED BEFORE THE SECOND MEMBER JM/AM 4. DRAFT DISCUSSED/APPROVED BY SECOND MEMBER. JM/AM 5. APPROVED DRAFT COMES TO THE SR.PS/PS .06.2015 PS/PS 6. KEPT FOR PRONOUNCEMENT ON PS 7. FILE SENT TO THE BENCH CLERK .06.2015 PS 8. DATE ON WHICH FILE GOES TO THE AR 9. DATE ON WHICH FILE GOES TO THE HEAD CLERK. 10. DATE OF DISPATCH OF ORDER. 4 ITA NO. 763/DEL/2014