ACIT, Circle - 42, Murshidabad , Murshidabad V. Sabyasachi Roychowdhury, Murshidabad

ITA 791/KOL/2018

• Counselvise Citation: [2018] 125 COUNSELVISE.COM (IT) 5983 (ITAT-KOLKATA)
• Duration Of Justice: 3 month(s) 6 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2014-2015
• Appeal Filed On: 24-04-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect
• Section: 143(3); 147

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH: KOL KATA [BEFORE SHRI S.S.GODARA, JM & DR. A.L. SAINI, AM] ITA NO. &A.Y. (1) REVENUE/REP. BY (2) V S 3 ASSESSEE/PAN/REP. BY (4) QUANTUM INVOLVED(RS.) (5) TAX EFFECT INVOLVED (RS.) (6) I.TA NO. 1346/KOL/2018 2007-08 SHRI S. DASGUPTA, ADDL. CIT-DR V S JAYASHREE JAYAKAR MOHANKA L/H OF LT. LALIT MOHANKA, MRUTI SADAN, 12, DOVER PARK, BALLYGUNGE, KOLKATA-19 PAN NO.AEAPM 5899P NONE 686/KOL/2018 2014-15 -DO- V S VIKRAM ARORA 1, GOBINDA KHATIK ROAD, TILJALA, KOLKATA-461 PAN NO.AEQPA9218L NONE 794/KOL/2018 & CO NO.62/KOL/18 (A/O ITA 794/K/18 ) 2012-13 -DO- V S M/S ECO JUTE PVT. LTD R.N. 6 KANKARIA ESTATE, 6 TH FLOOR, 6 RUSSEL STREET, KOLKATA-71 PAN AAACE 7225Q & CO-OBJECTOR ARIHANT JAIN, FCA 791/KOL/2018 2014-15 -DO- V S SABYASACHI ROYCHOWDHURY 44/3 K.N. ROAD, P.O. BERHAMPORE, MURSHIDABAD, PIN 742101 PAN NO.ACZPR 7496J SHRI P.K. SANGHAI, FCA 797-798/KOL/2018 2012-13 & 013-14 -DO- V S M/S BHARAT ROAD NETWORK LTD. 10B, MIRANIA GARDENS, TOPSIA ROAD, EAST, KOLKATA-46 PAN NO.AADCB 0921B NONE 293/KOL/2018 2012-13 -DO- V S M/S PARAGON FINANCE LTD. 4/1 MIDDLETON STREETSIKKIM HOUSE, 4 TH FLOOR, KOLKATA-71 PAN NO.AABCP 5872H SUBASH AGARWALA, ADVOCATE & SHRI SIDDARTH AGARWAL, ADVOCATE 257-258/KOL/2018 2012-13 & 2013-14 -DO- V S SHRI ATUL CHURIWAL 4, NATIONAL LIBRARY AVENUE, KOLKATA- 27 PAN NO.ADKPC 2492H NONE 166/KOL/2018 2012-13 -DO- V S M/S MJUNCTION SERVICES LTD. TATA CENTRE, 43, JAWAHARLAL NEHRU ROAD, KOLKATA-71 PAN NO.AACCM 5881C SHRI VIVEK RUIA, ACA 350/KOL/2018 2012-13 -DO- V S M/S LIBRA EXPORTS LTD., 25, PRINCEP STREET, KOLKATA-72 PAN NO.AAACL 5549 C SUBASH AGARWAL, ADVOCATE & SIDDHARTH AGARWAL, ADVOCATE 1161/KOL/2018 2013-14 -DO- M/S THE HOOGHLY MILLS & CO. LTD GARDEN REACH ROAD, KOLKATA-43 PAN NO.AAACT 9780F S./ JHAJHARIA, AR & SHRI SUJOY SEN, AR 790-791/KOL/2017 AYS 09-10 & 11-12 -DO- SHREE SHREE MOHANANNDA SAMAJ SEVA SAMITY AE-467, SALT LAKE CITY, KOLKTA-64 PAN NO.AADTS7675N SHRI V.N. DATTAN, ADVOCATE DATE OF HEARING: 31.07.2018 DATE OF PRONOUNCEMENT: 31.07.2018 2 ORDER PER S.S. GODAR, JUDICIAL MEMBER: 1. THESE REVENUES APPEALS ARISE OUT OF THE VARIOUS ORDERS OF THE LEARNED CIT(A)S APPEALS ORDERS IN ASSESSMENTS FRAMED U/S 147 / 143(3) / 144 OF THE INCOME TAX ACT, 1961; IN SHORT THE ACT AND ASSESSEES CROSS OBJECTION NO. 62/KOL/2018 ARISING OUT ITA NO.794/KOL/2018. 2. IT IS SEEN AT THE OUTSET THAT THE TAX EFFECT ON THE DISPUTED ADDITIONS BEFORE US IS LESS THAN RS. 20 LACS IN ALL CASES I.E. LESS THAN THE PRESCRIBED REVISED THRESHOLD LIMIT IN CBDTS LATEST CIRCULAR NO. 3/2018 DATED 11.07.2018. IT WILL BE PERTINENT TO REPRODUCE THE RELEVANT PORTION OF THE SAID CIRCULAR NO. 3/2018 DATED 11.07.2018:- 3 . HENCEFORTH, APPEALS/ SLPS SHALL NOT BE FILED I N CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY LIMITS GIVEN HEREUNDER: SL. NO. APPEALS/SLPS IN INCOME-TAX MATTERS MONETARY LIMIT (IN RS) 1. BEFORE APPELLATE TRIBUNAL 20,00,000/- 2. BEFORE HIGH COURT 50,00,000/- 3. BEFORE SUPREME COURT 1,00,00,000/- IT IS CLARIFIED THAT AN APPEAL SHOULD NOT BE FILED MERELY BECAUSE THE TAX EFFECT IN A CASE EXCEEDS THE MONETARY LIMITS PRESCRIBED ABOVE. FILING OF APP EAL IN SUCH CASES IS TO BE DECIDED ON MERITS OF THE CASE. 4. FOR THIS PURPOSE, 'TAX EFFECT' MEANS THE DIFFERE NCE BETWEEN THE TAX ON THE TOTAL INCOME ASSESSED AND THE TAX THAT WOULD HAVE BEEN CHARGEABLE HAD SUC H TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME IN RESPECT OF THE ISSUES AGAINST WHICH AP PEAL IS INTENDED TO BE FILED (HEREINAFTER REFERRED TO AS 'DISPUTED ISSUES). FURTHER, 'TAX EF FECT' SHALL BE TAX INCLUDING APPLICABLE SURCHARGE AND CESS. HOWEVER, THE TAX WILL NOT INCLUDE ANY INT EREST THEREON, EXCEPT WHERE CHARGEABILITY OF INTEREST ITSELF IS IN DISPUTE. IN CASE THE CHARGEAB ILITY OF INTEREST IS THE ISSUE UNDER DISPUTE, THE AMOUNT OF INTEREST SHALL BE THE TAX EFFECT. IN CASE S WHERE RETURNED LOSS IS REDUCED OR ASSESSED AS INCOME, THE TAX EFFECT WOULD INCLUDE NOTIONAL TAX O N 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. 3.1 WE FIND THAT INTENTION BEHIND THE CIRCULAR NO3/ 2018 DATED 11.07.2018 NEEDS TO BE UNDERSTOOD IN THE FOLLOWING PERSPECTIVE:- BY PASSAGE OF TIME, THE MONEY VALUE HAS GONE DOWN, THE COST OF LITIGATION EXPENSES HAS GONE UP, NUMBER OF ASSESSES ON THE FILES OF THE DEPARTMENT H AVE BEEN INCREASED AND CONSEQUENTLY, THE BURDEN ON THE DEPARTMENT IS ALSO INCREASED TO A TREMENDOUS EX TENT. THE CORRIDORS OF THE SUPERIOR COURTS ARE CHOK ED WITH HUGE PENDENCY OF CASES. IN THIS VIEW OF THE MATTER, THE CBDT HAS RIGHTLY TAKEN A DECISION TO R EVISE THE MONETARY LIMITS IN TUNE WITH THE PRESENT VALUE OF MONEY AND WITH A VIEW TO REDUCE THE LITIGATION A ND OFFERING RELIEF TO SMALL TAX PAYERS. THIS IS ALSO IN VIEW OF THE FACT THAT TIME AND ENERGY OF THE DE PARTMENT COULD BE USED MORE PRODUCTIVELY AND EFFICIENTLY TO CATCH HOLD OF BIG FISHES, WHO IN TURN WOULD CONTRI BUTE MORE TO THE DEVELOPMENT OF THE COUNTRY. 3 3.2. ON PERUSAL OF THE CIRCULAR NO. 3/2018 DATED 11 .07.2018 AND THE MATERIALS AVAILABLE ON RECORD, WE DO NOT SEE THESE CASES FALLING UNDER ANY OF THE EXCEPTIONS CONTEMPLATED IN THE SAID CIRCULAR PER SE . WE ALSO FIND THAT THIS CIRCULAR MAKES IT VERY CL EAR THAT THE REVISED MONETARY LIMITS SHALL APPLY RETROSPECTIVELY TO PENDING APPEA LS AS WELL. H ONBLE APEX COURT IN COMMISSIONER OF CUSTOMS VS INDIAN OIL CORPORATION L TD REPORTED IN 267 ITR 272 (SC) HAS SETTLED THE LAW THAT CBDTS CIRCULARS ARE VERY MUCH BINDING ON REVENUE AUTHORITIES. WE THUS HOLD THAT ALL THESE REVENUES APPEALS DESERVE TO BE DISMISSED IN TERMS OF LOW TAX EFFECT. WE MAKE IT CLEAR THAT IT SHALL VERY MUCH OPEN FOR THE REVENUE TO SEEK NECESSARY RECTIFICATION IN CASE IT IS FOUND THAT ANY OF THESE APPEALS INVOLVE OPERA TIONS OF EXCEPTION CLAUSES IN THE TAX EFFECT CIRCULAR AS PER LAW. 4. LEARNED COUNSEL IN CO NO.62/KOL/2018 IN ITA NO.7 94/KOL/2018 DOES NOT MUCH PRESCRIBE LIMIT. THIS CROSS OBJECTION IS DISMISSED AS NON PROSECUTION. 5. THESE REVENUES APPEALS ARE DISMISSED FOR INVOLV ING LOWER THAN THE PRESCRIBED MINIMUM TAX EFFECT WHEREAS ASSESSEES CO NO.62/KOL/2018 IS DISM ISSED AS NON PROSECUTION. ORDER PRONOUNCED IN THE COURT ON 31.07.2018 SD/- SD/- [DR. A.L. SAINI] [S.S. GODAR A] ACCOUNTANT MEMBER JUDICIAL MEMBER DATED : 31.07.2018 *DKP SR.P.S / COPY OF ORDER FORWARDED TO:- 1. / APPELLANT 2. / RESPONDENT 3. / CONCERNED CIT KOLKATA 4. - / CIT (A) KOLKATA 5. '', % , / DR, ITAT, KOLKATA 6. ) / GUARD FILE. BY ORDER/ , /TRUE COPY/ SR. PRIVATE SECRETARY, HEAD OF OFFICE/DDO % ,