Assistant Commissioner of Income-tax, Circle - 1, Jalgaon V. S.K. Translines Pvt. Ltd., Jalgaon

MA 02/PUN/2018

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 6484 (ITAT-PUNE)
• Duration Of Justice: 4 month(s) 22 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 23-04-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 01-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, PUNE . , , , BEFORE SHRI D. KARUNAKARA RAO, AM AND SHRI VIKAS AWASTHY, JM . / MA NO. 02 /PUN/201 8 (ARISING OUT OF ITA NO . 836 /PUN/201 5 ) / ASSESSMENT YEAR : 20 10 - 11 ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1, JALGAON ....... / APP LICANT / V/S. S.K. TRANSLINES PVT. LTD., 1 ST FLOOR, 17 19, SURESHDADA JAIN COMPLEX, JALGAON 425001 PAN : AAICS5895G / RESPONDENT ASSESSEE BY : S HRI SUNIL GANOO REVENUE BY : SHRI A JAY MODI / DATE OF HEARING : 23 - 02 - 2018 / DATE OF PRONOUNCEMENT : 23 - 0 4 - 201 8 / ORDER PER VIKAS AWASTHY, JM : TH IS MISCELLANEOUS APPLICATION HAS BEEN FILED BY THE REVENUE U/S. 254(2) O F THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT ) 2 MA NO. 02/PUN/2018, A.Y. 2010 - 11 SEEKING RECALLING OF THE ORDER OF TRIBUNAL IN ITA NO . 836/PUN/2015 FOR THE ASSESSMENT YEAR 2010 - 11 DECIDED ON 27 - 06 - 2017. 2. SHRI AJAY MODI REPRESENTING THE DEPARTMENT SUBMITTED THAT THE TRIBUNAL HA S DISMISSED THE APPEAL OF REVENUE BY FOLLOWING CBDT CIRCULAR NO. 21/2015, DATED 10 - 12 - 2015 ON ACCOUNT OF LOW T AX EFFECT. THE LD. DR SUBMITTED THAT THE HONBLE SUPREME COURT OF INDIA IN THE CASE OF COMMISSIONER OF INCOME TAX , BANGALORE - I & ANR. VS. M/S. GEMINI DISTILLERIES IN CIVIL APPEAL NO. 16815/2017 HAS HELD THAT THE CBDT CIRCULAR WILL NOT APPLY TO THE APPEAL S FILED BEFORE 10 - 12 - 2015. THE PRESENT APPEAL HAS BEEN FILED BY THE REVENUE BEFORE THE TRIBUNAL ON 03 - 06 - 2015. THUS, IN VIEW OF THE JUDGMENT OF HONBLE APEX COURT THE APPEAL OF REVENUE IS TO BE DECIDED ON MERITS. 3. ON THE OTHER HAND SHRI SUNIL GANOO A PPEARING ON BEHALF OF THE ASSESSEE FURNISHED THE COPY OF JUDGMENT RENDERED BY THE HONBLE SUPREME COURT OF INDIA IN THE CASE OF DIRECTOR OF INCOME TAX VS. M/S. S.R.M.B. DAIRY FARMING (P) LTD. IN CIVIL APPEAL NO. 19650 OF 2017 DECIDED ON 23 - 11 - 2017 TO CONTE ND THAT THE JUDGMENT RENDERED IN THE CASE OF COMMISSIONER OF INCOME TAX , BANGALORE - I & ANR. VS. M/S. GEMINI DISTILLERIES (SUPRA) WAS RENDERED BY TWO JUDGES BENCH , WHEREAS , THE LARGER BENCH OF THE HONBLE APEX COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VS. SURYA HERBAL LTD. DECIDED ON 29 - 08 - 2011 HAS HELD THAT THE CBDT CIRCULAR WOULD APPLY TO PENDING LITIGATION AS WELL. 4. BOTH SIDES HEARD. THE REVENUE HAS FILED THIS MISCELLANEOUS APPLICATION FOR RECALLING THE ORDER OF THE TRIBUNAL BY PLACING RELIANC E ON THE 3 MA NO. 02/PUN/2018, A.Y. 2010 - 11 DECISION OF HONBLE SUPREME COURT OF INDIA IN THE CASE OF COMMISSIONER OF INCOME TAX , BANGALORE - I & ANR. VS. M/S. GEMINI DISTILLERIES (SUPRA). THE HONBLE SUPREME COURT OF INDIA IN THE SUBSEQUENT JUDGMENT IN THE CASE OF DIRECTOR OF INCOME TAX VS. M/S. S.R.M.B. DAIRY FARMING (P) LTD. (SUPRA) IN AN UNEQUIVOCAL TERMS HAS CLARIFIED THAT THE JUDGMENT RENDERED BY THE THREE JUDGES BENCH IN THE CASE OF COMMISSIONER OF INCOME TAX VS. SURYA HERBAL LTD. (SUPRA) HAS L AID THE MATTER TO REST BY HOLDING THAT CBD T CIRCULAR OF 2011 INCREASING THE MONETARY LIMIT FOR FILING OF APPEALS BY THE REVENUE WOULD APPLY TO PENDING LITIGATION AS WELL. THE RELEVANT EXTRACT OF THE JUDGMENT RENDERED IN THE CASE OF DIRECTOR OF INCOME TAX VS. M/S. S.R.M.B. DAIRY FARMING (P) LTD. ( SUPRA) READS AS UNDER : THE VIEW OF THE SUPREME COURT : 18. THE VIEW ADOPTED BY THE DELHI HIGH COURT MAKING THE CIRCULAR APPLICABLE TO PENDING MATTERS CAME UP BEFORE A THREE JUDGE BENCH OF THIS COURT IN SLP(C) NO.CC 13694/2011 TITLED CIT CENTRAL - III V. SURYA HERBAL LTD . WHEN THE FOLLOWING ORDER WAS PASSED ON 29.8.2011: DELAY CONDONED. LIBERTY IS GIVEN TO THE DEPARTMENT TO MOVE THE HIGH COURT POINTING OUT THAT THE CIRCULAR DATED 9TH FEBRUARY, 2011, SHOULD NOT BE APPLIED IPSO FACTO, PARTICULARLY, WHEN THE MATTER HAS A CASCADING EFFECT. THERE ARE CASES UNDER THE INCOME TAX ACT , 1961, IN WHICH A COMMON PRINCIPLE MAY BE INVOLVED IN SUBSEQ UENT GROUP OF MATTERS OR LARGE NUMBER OF MATTERS. IN OUR VIEW, IN SUCH CASES IF ATTENTION OF THE HIGH COURT IS DRAWN, THE HIGH COURT WILL NOT APPLY THE CIRCULAR IPSO FACTO. FOR THAT PURPOSE, LIBERTY IS GRANTED TO THE DEPARTMENT TO MOVE THE HIGH COURT IN TW O WEEKS. THE SPECIAL LEAVE PETITION IS, ACCORDINGLY, DISPOSED OF. 19. THE AFORESAID ORDER, IN OUR VIEW, ACTUALLY SHOULD HAVE LAID THE CONTROVERSY TO REST. THE RETROSPECTIVE APPLICABILITY OF THE CIRCULAR DATED 9.2.2011 WAS NOT INTERFERED WITH, BUT WITH TWO CAVEATS (I) CIRCULAR SHOULD NOT BE APPLIED BY THE HIGH COURTS IPSO FACTO WHEN THE MATTER HAD A CASCADING EFFECT; (II) WHERE COMMON PRINCIPLES MAY BE INVOLVED IN SUBSEQUENT GROUP OF MATTERS OR A LARGE NUMBER OF MATTERS. IT WAS OPINED THAT IN SUCH CASES, THE ATTENTION OF THE HIGH COURT WOULD BE DRAWN AND THE DEPARTMENT WAS EVEN GIVEN LIBERTY TO 4 MA NO. 02/PUN/2018, A.Y. 2010 - 11 MOVE THE HIGH COURT IN TWO WEEKS. IN OUR VIEW THIS ORDER HOLDS THE FIELD AND SHOULD CONTINUE TO HOLD THE FIELD. 20. UNFORTUNATELY, THIS ORDER WAS NOT BROUGHT TO THE NOTICE OF THE SUBSEQUENT TWO JUDGES BENCH OF THIS COURT IN COMMISSIONER OF INCOME TAX - VII, NEW DELHI V. SUMAN DHAMIJA AGAIN ARISING FROM A DELHI HIGH COURT ORDER, WHEREIN IT WAS SIMPLY STATED THAT SINCE THE APPEALS WERE PREFERRED BEFORE 2011 AND THE INSTR UCTIONS WERE DATED 9.2.2011, THE EARLIER CASES WOULD NOT BE COVERED BY THE INSTRUCTION. THIS ORDER IN TURN HAD BEEN FOLLOWED BY ANOTHER TWO JUDGES BENCH IN CIVIL APPEAL NO.16815/2017 TITLED THE COMMISSIONER OF INCOME TAX BANGALORE I & ANR. V. M/S. GEMINI DISTILLERIES DATED 12.10.2017. 21. ONCE AGAIN, IN ANOTHER MATTER COMMISSIONER OF INCOME TAX &ANR. V. CENTURY PARK11 , THE LINE ADOPTED BY THE TH REE JUDGES BENCH IN SURYA HERBAL LTD. CASE (SUPRA) HAS BEEN FOLLOWED. 22. WE HAVE ALREADY GIVEN OUR IMPRIMATUR TO THE OBSERVATIONS MADE BY THE KARNATAKA HIGH COURT IN A DETAILED ANALYSIS IN RANKA & RANKA CASE (SUPRA), WHICH HAS DEALT WITH THE LITIGATION PO LICY PHILOSOPHY BEHIND APPLYING THE CIRCULAR AND THE BENEFIT BEING EXTENDED IN VIEW THEREOF TO ALL ASSESSEES WHERE APPEALS HAVE BEEN PENDING, BUT BELOW THE FINANCIAL LIMIT, AS OTHERWISE AN ANOMALOUS SITUATION WOULD ARISE. 23. WE MAY ALSO TAKE NOTE OF THE J UDGMENT OF THIS COURT IN SUCHITRA COMPONENTS LTD. V. COMMISSIONER OF CENTRAL EXCISE, GUNTUR 12 ON THE GENERAL PRINCIPLE OF APPLICATION OF CIRCULARS. RELIANCE WAS PLACED ON THE VIEW EXPRESSED IN COMMISSIONER OF CENTRAL EXCISE, BANGALORE V. MYSORE ELECTRICALS INDUSTRIES LTD . OPINING THAT A BENEFICIAL CIRCULAR HAS TO BE APPLIED RETROSPECTIVELY WHILE AN OPPRESSIVE CIRCULAR HAS TO BE APPLIED PROSPECTIVELY. 24. WE ARE OF THE VIEW THAT THE MATTER NEEDS TO BE PUT TO REST AND A CLARITY BE OBTAINED IN VIEW OF THE IMPACT OF THIS ISSUE ON PENDING CASES BEFORE THE HIGH COURTS AS WELL AS THE CASES WHICH HAVE BEEN DISPOSED OF BY VARIOUS HIGH COURTS BY APPLYING THE CIRCULA R OF 2011 TO PENDING LITIGATIONS. IN OUR VIEW THE MATTER HAS BEEN SQUARELY PUT TO REST TAKING FURTHER CARE OF THE INTEREST OF THE REVENUE BY THE ORDER PASSED BY THE THREE JUDGES BENCH OF THIS COURT IN SURYA HERBAL LTD. CASE (SUPRA), WHICH HAD PUT TWO CAVEA TS EVEN TO THE RETROSPECTIVE APPLICATION OF THE CIRCULAR. THE SUBSEQUENT ORDERS HAVE BEEN PASSED BY THE TWO JUDGES BENCH WITHOUT THOSE ORDERS BEING BROUGHT TO THE NOTICE OF THE COURT, A DUTY WHICH WAS CAST ON THE DEPARTMENT TO HAVE DONE SO TO AVOID THE AMB IGUITY WHICH HAS ARISEN. THUS, THE SAID VIEW OF THE THREE JUDGES BENCH WOULD HOLD WATER AND THE CIRCULAR WOULD APPLY EVEN TO PENDING MATTERS BUT SUBJECT TO THE TWO CAVEATS PROVIDED IN SURYA HERBAL LTD. CASE (SUPRA). 5. THUS, IN VIEW OF THE LAW SETTLED B Y THE HONBLE APEX COURT ON THE ISSUE OF APPLICABILITY OF CBDT CIRCULAR ENHANCING MONETARY LIMIT FOR FILING 5 MA NO. 02/PUN/2018, A.Y. 2010 - 11 APPEALS BY THE DEPARTMENT ON THE PENDING LITIGATION , THE PRESENT MISCELLANEOUS APPLICATION FILED BY THE REVENUE IS DISMISSED. 6. IN THE RESULT, THE MISCELLANEOUS APPLICATION BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON MONDAY, T HE 23 RD DAY OF APRIL, 201 8 . SD/ - SD/ - ( . /D. KARUNAKARA RAO ) ( / VIKAS AWASTHY) / ACCOUNTANT MEMBER / JUDICIAL MEMBER / PUNE; / DATED : 23 RD APRIL, 2018 RK / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT. 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 2, NASHIK 4. THE PR. COMMISSIONER OF INCOME TAX - 2, NASHIK 5. , , , / DR, ITAT, A BENCH, PUNE. 6. / GUARD FILE. / / // TRUE COPY// / BY ORDER, / PRIVATE SECRETARY, , / ITAT, PUNE