DCIT Circle 12 (1), V. General Sales Ltd,

ITA 992/DEL/2008

• Counselvise Citation: [2016] 131 COUNSELVISE.COM (IT) 7003 (ITAT-DELHI)
• Duration Of Justice: 8 year(s) 6 month(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 03-10-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Next Hearing Date: 15-09-2016
• Assessment Year: 2004-2005
• Appeal Filed On: 17-03-2008
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AMRIT LAL
• Keywords: Tax effect
• Section: 14A

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH C, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI L.P. SAHU, ACCOUNTANT MEMBER ITA NO. 992/DEL/2008 ASSESSMENT YEAR: 2004-05 DCIT, CIRCLE 12(1), VS. M/S GENERAL SALES LTD., NEW DELHI 18-19, ADITYA COMMERCIAL COMPLEX, NANGAL RAYA, NEW DELHI 110 046 (PAN: AAACG-126C) (APPELLANT) (RESPONDENT) APPELLANT BY : SH. AMRIT LAL, SR. DR RESPONDENT BY : SH. DEEPESH JAIN, CA DATE OF HEARING : 15-09-2016 DATE OF ORDER : 03-10-2016 ORDER PER H.S. SIDHU, J.M. THIS APPEAL FILED BY THE DEPARTMENT IS DIRECTED A GAINST THE ORDER DATED 27.11.2007 OF LD. CIT(A)-XVIII, NEW DELHI PERTAININ G TO ASSESSMENT YEAR 2004-05. 2. THE GROUNDS RAISED IN BOTH THESE APPEALS READ AS UNDER:- 1. ON THE FACTS AND IN THE CIRCUMSTANCE OF THE CASE AND IN LAW, THE CIT(A) ERRED IN DELETING THE ADDITION OF RS. 61 9947/- OUT OF THE GAL EXPENSES, IGNORING THE FACT THAT THESE WERE CAPITAL IN NATURE AS THESE EXPENSES WERE INCURRED BY THE ASSES SEE WITH A VIEW TO PRESERVE THE EXISTING BUSINESS STRUCTURE OF THE COMPANY. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E AND IN LAW, THE CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS . 3304500/- ON ACCOUNT OF DISALLOWANCE MADE UNDER SECTION 14A O F THE INCOME TAX ACT, 1961. 3. THE APPELLANT CRAVES LEAVE TO ADD, ALTER OR AMEN D ANY GROUND OF APPEAL RAISED ABOVE AT THE TIME OF THE HE ARING. ITA NO. 992/DEL/2008 2 3. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE MATERIAL ON RECORD. AT THE THRESHOLD, WE FIND THAT THE TAX EFFECT IN THE R EVENUE APPEAL IS LESS THAN RS.10,00,000/-, THEREFORE, THE DEPARTMENTS APPEALS IS NOT MAINTAINABLE, IN VIEW OF THE CIRCULAR NO. 21/2015 DATED 10 TH DECEMBER, 2015 ISSUED VIDE F.NO. 279/MISC. 142/2007-ITJ (PT.) BY THE CBDT. FOR THE SAKE OF CONVENIENCE, THE RELEVANT PARA NOS. 3 & 10 OF THE AFORESAID CBDTS C IRCULAR ARE REPRODUCED AS UNDER:- 3. HENCEFORTH, APPEALS/ SLPS SHALL NOT BE FILED IN CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY L IMITS GIVEN HEREUNDER: S NO APPEALS IN INCOME-TAX MATTERS MONETARY LIMIT (IN RS) 1 BEFORE APPELLATE TRIBUNAL 10,00,000/- 2 BEFORE HIGH COURT 20,00,000/- 3 BEFORE SUPREME COURT 25,00,000/- IT IS CLARIFIED THAT AN APPEAL SHOULD NOT BE FILED MERELY BECAUSE THE TAX EFFECT IN A CASE EXCEEDS THE MONETA RY LIMITS PRESCRIBED ABOVE. FILING OF APPEAL IN SUCH CASES IS TO BE DECIDED ON MERITS OF THE CASE. 10. THIS INSTRUCTION WILL APPLY RETROSPECTIVELY TO PENDING APPEALS AND APPEALS TO BE FILED HENCEFORTH IN HIGH COURTS/ TRIBUNALS. PENDING APPEALS BELOW THE SPECIFIED TAX LIMITS IN PARA 3 ABOVE MAY BE WITHDRAWN/ NOT PRESSED. APPEALS BEFORE THE SUPREME COURT WILL BE GOVERNED BY THE INSTRUCTI ONS ON THIS SUBJECT, OPERATIVE AT THE TIME WHEN SUCH APPEA L WAS FILED. 4. IT IS NOT IN DISPUTE THAT THE BOARDS INSTRUCTIO N OR DIRECTIONS ISSUED TO THE INCOME-TAX AUTHORITIES ARE BINDING ON THOSE AUTHORI TIES, THEREFORE, THE DEPARTMENT SHOULD HAVE WITHDRAWN/ NOT PRESSED THE P RESENT APPEAL, IN VIEW OF THE AFORESAID INSTRUCTIONS SINCE THE TAX EFFECT IN THE INSTANT APPEAL IS LESS THAN THE AMOUNT OF RS. 10 LACS, PRESCRIBED IN THE ABOVE SAID CBDTS INSTRUCTIONS. 5. KEEPING IN VIEW THE CBDT INSTRUCTION NO. 21/2015 DATED 10 TH DECEMBER, 2015, WE ARE OF THE VIEW THAT THE REVENUE SHOULD HA VE WITHDRAWN/ NOT PRESSED THE INSTANT APPEAL BEFORE THE TRIBUNAL. WE ARE ALS O OF THE VIEW THAT THE SAID ITA NO. 992/DEL/2008 3 INSTRUCTIONS ARE APPLICABLE FOR THE PENDING APPEALS AND APPEALS TO BE FILED HENCEFORTH IN TRIBUNAL. 6. IN THE RESULT, THE APPEAL FILED BY THE REVENUE S TAND DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 03/10/2016. SD/- SD/- (L.P. SAHU) (H.S. SIDHU) (ACCOUNTANT MEMBER JUDI CIAL MEMBER DATED: 03/10/2016 *SR BHATNAGAR* COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR