ACIT, Jaipur V. SHRI BANSIDHAR AGARWAL, Jaipur

ITA 868/JPR/2012

• Counselvise Citation: 86823114 RSA 2012
• Duration Of Justice: 1 year(s) 2 month(s) 3 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-01-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Assessment Year: 2007-2008
• Appeal Filed On: 12-11-2012
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: D C SHARMA
• Keywords: Bogus purchase; Rejection of books of accounts; Depreciation; Retrospective amendment; Tax effect

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL JAIPUR BENCH, JAIPUR. ( BEFORE SHRI HARI OM MARATHA AND SHRI N.K. SAINI ) ITA NO. 868/JP/2012 ASSESSMENT YEAR : 2007-08 PAN: AANPA 6881 E THE ACIT VS. SHRI BANSIDHAR AGARWAL CIRCLE- 1 PROP. M/S. AGARWAL & CO. JAIPUR 1307, KEDIA BHAWAN, GOPAL JI KA RASTA JAIPUR (APPELLANT) (RESPONDENT) DEPARTMENT BY : SHRI D.C. SHARMA ASSESSEE BY : SHRI MANISH AGARWAL (ADJOURNMEN T APPLICATION REJECTED) DATE OF HEARING : 16.01.2014. DATE OF PRONOUNCEMENT : 16.01.2014 ORDER PER N.K. SAINI, A.M. THIS APPEAL BY THE REVENUE IS DIRECTED AGAINST THE ORDER DATED 11-09-2011 OF LD. CIT(A)-1, JAIPUR . FOLLOWING GROUNDS HAVE BEEN RAIS ED IN THIS REGARD. WHETHER ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. CIT(A) IS JUSTIFIED IN:- (I) RESTRICTING THE TRADING ADDITION OF RS. 7,98,05 3/- MADE BY AO ON ACCOUNT OF BOGUS PURCHASES AND OTHER DEFECTS AFTER REJECTING BOOKS OF ACCOUNT U/S 145(3) OF THE ACT TO RS. 27,649/- WHEN THE LD. CIT(A) HAS CONFIRMED THE REJECTION OF BOOKS OF ACCOUNTS. (II) DELETING THE DISALLOWANCE OF RS. 26,212/- MADE BY AO ON ACCOUNT OF MOTOR CAR EXPENSES AND DEPRECIATION ON CAR ON ACCOUNT OF PERSONAL USE. 2 (III) DELETING THE DISALLOWANCE OF RS. 85,870/- MAD E BY AO OUT OF SHOP EXPENSES. 2. DURING THE COURSE OF HEARING, THE LD. COUNSEL FO R THE ASSESSEE AT THE VERY OUTSET STATED THAT TAX EFFECT IN THIS APPEAL IS LESS THAN RS. 3.00 LACS. THEREFORE, THE DEPARTMENT OUGHT NOT TO HAVE FILED THIS APPEAL AS PER INSTRUCT ION GIVEN BY CBDT IN INSTRUCTION NO. 3/2011 DATED 9-02-2011. THE LD. COUNSEL FOR THE ASS ESSEE ALSO GAVE THE CALCULATION OF TAX EFFECT AS UNDER:- TOTAL AMOUNT INVOLVED IN THE GROUNDS TAKEN BY THE D EPARTMENT RS.8,82,486/- TAX PAYABLE @ 30% RS.2,64,746/- ADD: SURCHARGE @ 10% RS. 26,745/- EDUCATION CESS @ 2% RS. 58,241/- TOTAL TAX PAYABLE RS. 2,97,045/- 3. THE LD. DR IN HIS RIVAL SUBMISSIONS STATED THAT TAX EFFECT IN THIS CASE IS MORE THAN RS. 3.00 LACS. 4. AFTER CONSIDERING THE SUBMISSIONS OF THE LD. D.R . AND THE MATERIAL ON RECORD, IT IS NOTICED THAT SECTION 268A HAS BEEN INSERTED BY THE FINANCE ACT, 2008 WITH RETROSPECTIVE EFFECT FROM 01/04/99. THE PROVISIONS CONTAINED IN SECTION 268A READ AS UNDER: 268A. (1) THE BOARD MAY, FROM TIME TO TIME, ISSUE ORDERS, INSTRUCTIONS OR DIRECTIONS TO OTHER INCOME-TAX AUTH ORITIES, FIXING SUCH MONETARY LIMITS AS IT MAY DEEM FIT, FOR THE PURPOSE OF REGULATING FILING OF APPEAL OR APPLICATI ON FOR REFERENCE BY ANY INCOME-TAX AUTHORITY UNDER THE PRO VISIONS OF THIS CHAPTER. (2) WHERE, IN PURSUANCE OF THE ORDERS, INSTRUCTIONS OR DIRECTIONS ISSUED UNDER SUB-SECTION (1), AN INCOME- TAX AUTHORITY HAS NOT FILED ANY APPEAL OR APPLICATION F OR REFERENCE ON ANY ISSUE IN THE CASE OF AN ASSESSEE F OR ANY ASSESSMENT YEAR, IT SHALL NOT PRECLUDE SUCH AUTHORI TY FROM 3 FILING AN APPEAL OR APPLICATION FOR REFERENCE ON TH E SAME ISSUE IN THE CASE OF (A) THE SAME ASSESSEE FOR ANY OTHER ASSESSMENT YEAR ; OR (B) ANY OTHER ASSESSEE FOR THE SAME OR ANY OTHER ASSESSMENT YEAR. (3) NOTWITHSTANDING THAT NO APPEAL OR APPLICATION F OR REFERENCE HAS BEEN FILED BY AN INCOME-TAX AUTHORITY PURSUANT TO THE ORDERS OR INSTRUCTIONS OR DIRECTIONS ISSUED UNDER SUB- SECTION (1), IT SHALL NOT BE LAWFUL FOR AN ASSESSEE , BEING A PARTY IN ANY APPEAL OR REFERENCE, TO CONTEND THAT T HE INCOME- TAX AUTHORITY HAS ACQUIESCED IN THE DECISION ON THE DISPUTED ISSUE BY NOT FILING AN APPEAL OR APPLICATION FOR RE FERENCE IN ANY CASE. (4) THE APPELLATE TRIBUNAL OR COURT, HEARING SUCH A PPEAL OR REFERENCE, SHALL HAVE REGARD TO THE ORDERS, INSTRUC TIONS OR DIRECTIONS ISSUED UNDER SUB-SECTION (1) AND THE CIR CUMSTANCES UNDER WHICH SUCH APPEAL OR APPLICATION FOR REFERENC E WAS FILED OR NOT FILED IN RESPECT OF ANY CASE. (5) EVERY ORDER, INSTRUCTION OR DIRECTION WHICH HAS BEEN ISSUED BY THE BOARD FIXING MONETARY LIMITS FOR FILI NG AN APPEAL OR APPLICATION FOR REFERENCE SHALL BE DEEMED TO HAVE BEEN ISSUED UNDER SUB-SECTION (1) AND THE PROVISION S OF SUB- SECTIONS (2), (3) AND (4) SHALL APPLY ACCORDINGLY.] 5. IT IS NOT IN DISPUTE THAT THE BOARDS INSTRUCTIO N OR DIRECTIONS ISSUED TO THE OTHER INCOME-TAX AUTHORITIES ARE BINDING ON THOSE AUTHORITIES, THEREFORE, THE DEPARTMENT OUGHT NOT TO HAVE FILED T HE APPEAL IN VIEW OF THE ABOVE MENTIONED SECTION 268A SINCE THE TAX EFFECT I N THE INSTANT CASE IS LESS THAN THE AMOUNT PRESCRIBED FOR NOT FILING THE APPEAL. 4 6. IT IS NOTICED THAT THE CBDT HAS ISSUED INSTRUCTI ON NO.3 OF 2011 DATED 09.02.2011, BY WHICH THE CBDT HAS REVISED THE MONETARY LIMIT TO RS. 3,00,000/- FOR FILING THE APPEAL BEFORE THE TR IBUNAL. 7. KEEPING IN VIEW THE CBDT INSTRUCTION NO.3 OF 201 1 DATED 09.02.2011 AND ALSO THE PROVISIONS OF SECTION 268A OF INCOME TAX ACT, 1961, WE ARE OF THE VIEW THAT THE REVENUE SHOULD NO T HAVE FILED THE INSTANT APPEAL BEFORE THE TRIBUNAL. WHILE TAKING SU CH A VIEW, WE ARE FORTIFIED BY THE FOLLOWING DECISIONS OF HON'BLE PUN JAB & HARYANA HIGH COURT :- 1. CIT V OSCAR LABORATORIES P. LTD (2010) 324 ITR 115 (P&H) 2. CIT V ABINASH GUPTA (2010) 327 ITR 619 (P&H) 3. CIT V VARINDERA CONSTRUCTION CO. (2011) 331 ITR 449 (P&H)(FB) 8. SIMILARLY THE HONBLE DELHI HIGH COURT IN THE CA SE OF CIT V. DELHI RACE CLUB LTD. IN ITA NO.128/2008, ORDER DATED 03.0 3.2011 BY FOLLOWING THE EARLIER ORDER DATED 02.08.2010 IN ITA NO.179/19 91 IN THE CASE OF CIT DELHI-III V. M/S. P.S. JAIN & CO. HELD THAT SUCH CIRCULAR WOULD ALSO BE APPLICABLE TO PENDING CASES. 9. FROM THE RATIO LAID DOWN BY THE HONBLE DELHI HI GH COURT, IT IS CLEAR THAT THE INSTRUCTIONS ISSUED IN THE CIRCULARS BY CBDT ARE APPLICABLE FOR PENDING CASES ALSO. THEREFORE, BY KEEPING IN V IEW THE RATIO LAID DOWN 5 IN THE AFORESAID REFERRED TO CASES, WE ARE OF THE C ONSIDERED VIEW THAT INSTRUCTION NO.3/11 DATED 09.02.2011 ISSUED BY THE CBDT ARE APPLICABLE FOR THE PENDING CASES ALSO AND IN THE SAID INSTRUCT IONS, MONETARY TAX LIMIT FOR NOT FILING THE APPEAL BEFORE THE ITAT IS RS. 3. 00 LAKHS. 10. IN VIEW OF THE ABOVE, WITHOUT GOING INTO MERITS OF THE CASE, WE DISMISS THE APPEAL FILED BY THE REVENUE. 11. IN THE RESULT, THE APPEAL OF THE REVENUE STANDS DISMISSED. (ORDER PRONOUNCED IN THE OPEN COURT ON 16- 01-20 14) SD/- SD/- (HARI OM MARATHA ) ( N.K. SAINI ) JUDICIAL MEMBER ACCOUNTANT MEMBER JAIPUR DATED: 16 TH JAN 2014 *MISHRA COPY FORWARDED TO :- 1. THE ACIT, CIRCLE- 1, JAIPUR 2. SHRI BANSIDHAR AGARWAL, JAIPUR BY ORDE R 3. THE LD. CIT (A) 4. THE LD. CIT 5. THE D/R 6. GUARD FILE (ITA NO. 868/JP/2012) AR ITAT JAIPUR.