DCIT, CC-V, Kolkata, Kolkata V. M/s. Shree Parasnath Re-Rolling Mills Ltd., Kolkata

ITSSA 97/KOL/2011

• Counselvise Citation: [2016] 122 COUNSELVISE.COM (IT) 1532 (ITAT-KOLKATA)
• Duration Of Justice: 4 year(s) 7 month(s) 5 day(s)
• Appeal Type: Income Tax (Search & Seizure) Appeal
• Pronouncement Date: 20-01-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 02-01-2013
• Assessment Year: 2004-2005
• Appeal Filed On: 15-06-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NIRAJ KUMAR
• Assessee Lawyers: A K TULSIYAN
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCH B KOLKATA BEFORE SHRI N.V.VASUDEVAN, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER IT (SS) A NO. 97 - 98 / KOL / 201 1 ASSESSMENT YEARS :2004-05 & 2005-06 DCIT, CC-V, 5 TH FLOOR PODDAR COURT, 18, RABINDRA SARANI, KOLKATA-700 001 V/S . M/S SHREE PARASHNATH RE- ROLLING MILLS LTD., 14C, M.D. ROAD, 3 RD FLOOR, KOLKATA-700 007 [ PAN NO.AAGCS 2108 E ] /APPELLANT .. / RESPONDENT /BY APPELLANT SHRI NIRAJ KUMAR, CIT-DR /BY RESPONDENT SHRI A.K. TULSIYAN, FCA /DATE OF HEARING 21-12-2015 /DATE OF PRONOUNCEMENT 20-01-2016 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER:- BOTH APPEALS BY THE REVENUE ARE AGAINST THE ORDERS OF COMMISSIONER OF INCOME TAX (APPEALS),CENTRAL-I, DAT ED 01.03.2011. ASSESSMENTS WERE FRAMED BY DCIT CENTRAL CIRCLE-V, K OLKATA U/S 153A/143(3) OF THE INCOME TAX ACT, 1961 (HEREINAFTE R REFERRED TO AS THE ACT) VIDE HIS ORDERS DATED 31.12.2009 FOR ASSESSME NT YEARS 2004-05 & 2005-06 RESPECTIVELY. IT(SS)A NO.97-98/KOL/2011 A.YS. 2004 -05 & 2005-06 DCIT CC-V KOL. V. M/S SHREE PARASHNATH RE-ROLLI NG MILLS. PAG E 2 SHRI A.K.TULSIYANLD. AUTHORIZED REPRESENTATIVE APPE ARING ON BEHALF OF ASSESSEE AND SHRI NIRAJ KUMAR LD. DEPARTMENTAL REPR ESENTATIVE APPEARING ON BEHALF OF REVENUE. 2. AT THE TIME OF HEARING LD. AR SUBMITTED THAT BOT H THE APPEALS ARE RELATING TO SAME ASSESSEE. HENCE, WE HEARD THEM TOG ETHER AND PASSED A CONSOLIDATED ORDER FOR THE SAKE OF CONVENIENCE. 3. OF LATE, THE CBDT HAS ISSUED CIRCULAR NO. 2 1/2015, DATED 10TH DECEMBER, 2015, WHEREBY THE MONETARY LIMITS FOR FIL ING OF APPEALS BY THE DEPARTMENT BEFORE INCOME TAX APPELLATE TRIBUNAL AND HON'BLE HIGH COURTS AND SLP BEFORE HON'BLE SUPREME COURT HAVE BE EN INCREASED AS MEASURE FOR REDUCING LITIGATION. THE REVISED MONE TARY LIMITS LAID DOWN IN PARA-3 OF THIS CIRCULAR AND THE MANNER OF COMPUT ING TAX EFFECT AS LAID DOWN IN PARA-4 OF THIS CIRCULAR ARE AS FOLLOWS: 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 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 MONETARY LIMITS PR ESCRIBED ABOVE. FILING OF APPEAL 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 W OULD HAVE BEEN CHARGEABLE HAD SUCH TOTAL INCOME BEEN REDUCED BY TH E AMOUNT OF IT(SS)A NO.97-98/KOL/2011 A.YS. 2004 -05 & 2005-06 DCIT CC-V KOL. V. M/S SHREE PARASHNATH RE-ROLLI NG MILLS. PAG E 3 INCOME IN RESPECT OF THE ISSUES AGAINST WHICH APPEA L IS INTENDED TO BE FILED (HEREINAFTER REFERRED TO AS 'DISPUTED ISSU ES'). HOWEVER THE TAX WILL NOT INCLUDE ANY INTEREST THEREON, EXCEPT W HERE CHARGEABILITY OF INTEREST ITSELF IS IN DISPUTE. IN CASE THE CHARG EABILITY OF INTEREST IS THE ISSUE UNDER DISPUTE, THE AMOUNT OF INTEREST SHA LL BE THE TAX EFFECT. IN CASES 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 EFFEC T WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE ORDER TO BE APPEALED AGAINST. 4. IN PARA-10 OF THE SAID CIRCULAR IT HAS BEEN FUR THER BEEN CLARIFIED THAT THE REVISED MONETARY LIMITS WILL APPLY RETROSPECTIV ELY. THE RELEVANT PARA- 10 OF THE CIRCULAR READS THUS: 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 P ARA 3 ABOVE MAY BE WITHDRAWN/ NOT PRESSED. APPEALS BEFORE THE S UPREME COURT WILL BE GOVERNED BY THE INSTRUCTIONS ON THIS SUBJECT, OPERATIVE AT THE TIME WHEN SUCH APPEAL WAS FILED. 4. 1 IN BOTH THE PRESENT CASE, THE TAX EFFECT IN TH IS APPEAL BY THE REVENUE IS LESS THAN RS.10,00,000/-. THOUGH BOTH A PPEALS HAD BEEN FILED BY THE REVENUE ON 15.06.2011 AND WERE WITHIN THE MONETARY LIMIT IN THE FORM OF TAX EFFECT FOR FILING APPEALS BEFORE TR IBUNAL, IN VIEW OF PARA-10 OF THE CIRCULAR OF CBDT, EVEN SUCH APPEALS WILL BE GOVERNED BY THE NEW MONETARY LIMITS LAID DOWN IN THE CBDT CIRCULAR NO.1 2/2015 REFERRED TO ABOVE. 5. IT IS A SETTLED LAW THAT THE CIRCULARS ISSUED B Y CBDT ARE BINDING ON THE REVENUE. THIS POSITION WAS CONFIRMED BY THE APE X COURT IN THE CASE OF COMMISSIONER OF CUSTOMS VS INDIAN OIL CORPORATIO N LTD. REPORTED IN 267 ITR 272 WHEREIN THEIR LORDSHIPS EXAMINED THE EA RLIER DECISIONS OF THE APEX COURT WITH REGARD TO BINDING NATURE OF THE CIRCULAR AND LAID DOWN THAT WHEN A CIRCULAR ISSUED BY THE BOARD REMAI NS IN OPERATION THEN IT(SS)A NO.97-98/KOL/2011 A.YS. 2004 -05 & 2005-06 DCIT CC-V KOL. V. M/S SHREE PARASHNATH RE-ROLLI NG MILLS. PAG E 4 THE REVENUE IS BOUND BY IT AND CANNOT BE ALLOWED TO PLEAD THAT IT IS NOT VALID OR THAT IT IS CONTRARY TO THE TERMS OF THE ST ATUTE. THE APPEAL UNDER CONSIDERATION HAS CERTAINLY BEEN FILED CONTRARY TO THE CIRCULAR ISSUED BY THE CBDT CIRCULAR NO.21/2015. 6. IN VIEW OF THE ABOVE, WE HOLD THAT BOTH APPEALS FILED BY THE DEPARTMENT, AGAINST THE IMPUGNED ORDER OF THE LD. C IT(A), ARE CONTRARY TO THE POLICY DECISION OF THE DEPARTMENT AND AS SUC H BOTH APPEALS FILED BY THE DEPARTMENT IS DISMISSED IN LIMINE . 7. IN THE RESULT, BOTH APPEALS OF REVENUE ARE DISMISSE D IN LIMINE . ORDER PRONOUNCED IN THE OPEN COURT 20/01/2016 SD/- SD/- (N.V.VASUDEVAN) (WASEEM AHMED) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) KOLKATA, *DKP !- 20 / 0 1/201 6 / COPY OF ORDER FORWARDED TO:- 1. /APPELLANT-DCIT,CC-V 5 TH FL, PODDAR COURT, 18 RABINDRASARANI, KOL-1 2. /RESPONDENT- M/S SHREE PARASHNATHRE-ROLLING MILLS L TD. 14C,M.D.RD,3 RD FL, KOL-07 3. ) *+, , - / CONCERNED CIT KOLKATA 4., , -- / CIT (A) KOLKATA 5.01233*+,, *+ , / DR, ITAT, KOLKATA 6.26789 / GUARD FILE. BY ORDER/ ,, /TRUE COPY/ / , *+ ,