ITO 25(3)(4), MUMBAI V. SANJESH R. DHALL, MUMBAI

ITA 8652/MUM/2010

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 83501 (ITAT-MUMBAI)
• Duration Of Justice: 3 year(s) 7 month(s) 26 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-08-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: E
• Next Hearing Date: 06-08-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 10-12-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: M MURALI
• Assessee Lawyers: S S PHADKARAR
• Keywords: Question of law; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, MUMBAI BENCH E, MUMBAI BEFORE SHRI N.K. BILLAIYA, ACCOUNTANT MEMBER AND SHRI SANJAY GARG, JUDICIAL MEMBER ITA NO.8652/M/2010 ASSESSMENT YEAR: 2007-08 ITO 25(3)(4) C-10, PRATYAKSH KAR BHAVAN, ROOM NO.307, BANDRA KURLA COMPLEX BANDRA (E) MUMBAI 400 051 VS. SHRI SANJESH R. DHALL 2402, AKURLI SATYA CHS LTD. LOKHANDWALA COMPLEX, KANDIVALI (E) MUMBAI 400 101 PAN: AAFPD8577N (APPELLANT) (RESPONDENT) APPELLANT BY : SHRI M. MURALI (DR) RESPONDENT BY : SHRI S.S. PHADKAR(AR) DATE OF HEARING : 06.08.2014 DATE OF PRONOUNCEMENT : 06.08.2014 O R D E R PER SANJAY GARG, JUDICIAL MEMBER: THE PRESENT APPEAL IS PREFERRED BY THE REVENUE AGAI NST THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) DATED 28.09.20 10 AGITATING THE DELETION OF THE ADDITION OF RS.9,79,781/- WHICH WAS MADE BY THE ASSESSING OFFICER UNDER SECTION 40(A)(IA). 2. AT THE OUTSET, LD. AR OF THE ASSESSEE SUBMITTED TH AT THE TAX EFFECT IN RELATION TO THE DISPUTED ADDITION IS LESS THAN RS.3 ,00,000/-. HE HAS ALSO PRODUCED THE WORKING OF THE TAX EFFECT WHICH HAS BE EN WORKED OUT AT RS.2,95,433.62/-. THE LD. DR HAS ALSO NOT DISPUTED THE ABOVE CALCULAT ION, HOWEVER HIS CONTENTION HAS BEEN THAT THE APPLICATION OF THE CBD T INSTRUCTION NO.3 OF 2011, DATED 9 TH FEBRUARY 2011 IS PROSPECTIVE IN NATURE AND IS NOT APPLICABLE TO PENDING APPEALS AS ON THE DATE OF ISSUANCE OF THE S AID INSTRUCTIONS. ITA NO.8652/M/2010 2 3. AFTER HEARING THE LEARNED REPRESENTATIVES OF BOTH T HE PARTIES WE FIND THAT AS PER CBDT INSTRUCTION NO.3 OF 2011, DATED 9 TH FEBRUARY 2011, THE APPEAL BEFORE THE APPELLATE TRIBUNAL CAN BE FILED BY THE R EVENUE, WHEN THE TAX EFFECT EXCEEDS THE MONITORY LIMIT OF RS.3,00,000/-. 4. SO FAR THE APPLICABILITY OF CIRCULAR OF 2011 AS APP LICABLE TO THE APPEALS FILED EARLIER IS CONCERNED, THE HON'BLE BOMBAY HIGH COURT IN THE CASE OF CIT V/S MADHUKAR K. INAMDAR (HUF), [2009] 318 ITR 149 (BOM.) WHILE DEALING WITH THE QUESTION OF APPLICABILITY OF A SIMILAR TYP E OF CIRCULAR OF 2008, HAS OBSERVED AS UNDER:- THE CIRCULAR DATED MAY 15, 2008 IN GENERAL AND PAR AGRAPH (5) THEREOF IN PARTICULAR LAY DOWN THAT EVEN IF THE SAM E ISSUE, IN RESPECT OF THE SAME ASSESSEE, FOR OTHER ASSESSMENT YEARS IS IN VOLVED, THE DEPARTMENT SHOULD NOT FILE APPEAL, IF THE TAX EFFEC T IS LESS THAN ` 4 LAKHS. IN OTHER WORDS, EVEN IF THE QUESTION OF LAW IS OF RECURRING NATURE, THE REVENUE IS NOT EXPECTED TO FILE APPEALS IN SUCH CASES, IF THE TAX IMPACT IS LESS THAN THE MONETARY LIMIT FIXED BY THE CENTRAL BOARD OF DIRECT TAXES. THE BOARD HAS ALSO ISSUED A CIRCULAR ON JUNE 5, 2007, DIRECTING THE DEPARTMENT TO EXAMINE ALL APPEALS PEN DING BEFORE THE COURT ON A CASE TO CASE BASIS WITH FURTHER DIRECTIO N TO WITHDRAW CASES WHEREIN THE CRITERIA OF MONETARY LIMITS AS PER THE PREVAILING INSTRUCTION ARE NOT SATISFIED, UNLESS THE QUESTION OF LAW INVOL VED OR RAISED IN APPEAL OR REFERRED TO THE HIGH COURT FOR OPINION IS OF A RECURRING NATURE REQUIRED TO BE SETTLED BY THE HIGHER COURT. THE CIRCULAR MAKES IT CLEAR THAT ON THE DATE OF ISSUANCE OF THE CIRCULAR, PREVAILING INSTRUCTIONS FIXING MONETARY LIMIT WILL HOLD GOOD E VEN FOR PENDING CASES. THE CIRCULAR DATED MAY 15, 2008 WOULD BE APP LICABLE TO PENDING CASES REQUIRING THE DEPARTMENT TO WITHDRAW CASES WHEREIN THE TAX EFFECT IS LESS THAN THE PRESCRIBED MONETARY LIM ITS. THE CIRCULAR DATED MAY 15, 2008, WOULD BE APPLICABLE TO CASES PE NDING BEFORE THE COURT EITHER FOR ADMISSION OR FOR FINAL DISPOSAL AN D IT IS BINDING ON THE REVENUE. SIMILAR VIEW WAS TAKEN BY THE HON'BLE JURISDICTIONA L HIGH COURT IN THE JUDGMENT IN CIT V/S PITHWA ENGINEERING WORKS, [2005 ] 276 ITR 519 (BOM.), AND THE HON'BLE DELHI HIGH COURT IN M/S. P.S. JAIN & CO., [2011] 335 ITR 591 ITA NO.8652/M/2010 3 (DEL.). APPLYING THE PROPOSITIONS LAID DOWN IN THES E CASE LAWS TO THE FACTS OF THE PRESENT CASE, THE APPEAL OF THE REVENUE'S IS DI SMISSED UNDER SECTION 268A OF THE INCOME TAX ACT. 5. IN THE RESULT, REVENUES APPEAL IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 06.08.2014 . SD/- SD/- (N.K. BILLAIYA) (SANJAY GARG ) ACCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI, DATED: 06.08.2014. *A.K.PATEL COPY TO: THE APPELLANT THE RESPONDENT THE CIT, CONCERNED, MUMBAI THE CIT (A) CONCERNED, MUMBAI THE DR C BENCH //TRUE COPY// [ BY ORD ER DY/ASSTT. REGISTRAR, ITAT, MUMBAI.