Assistant Commissioner of Income Tax Circle-1 , Kalaburagi V. Sri Karnam Venkata Subbaiah , Gulbarga

MA 10/BANG/2018

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 6747 (ITAT-BANGALORE)
• Duration Of Justice: 5 month(s) 10 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 27-06-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: C
• Assessment Year: 2007-2008
• Appeal Filed On: 16-01-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL SMC-C BENCH : BANGALORE BEFORE SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER M.P. NO. 10/BANG/2018 (IN ITA NO. 1082 /BANG/201 7 ) ASSESSMENT YEAR : 20 0 7 - 08 THE ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1, KALABURAGI. VS. SHRI KARNAM VENKATA SUBBAIAH, PLOT NO. P-8, M.B. NAGAR, KALABURAGI. PAN: ACSPV0991M APPELLANT RESPONDENT APPELLANT BY : NONE RESPONDENT BY : NONE DATE OF HEARING : 2 2 .0 6 .2018 DATE OF PRONOUNCEMENT : 27 .0 6 .2018 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER THIS M.P. IS FILED BY THE REVENUE RAISING THIS CONT ENTION THAT THERE ARE CERTAIN MISTAKES IN THE EX-PARTE TRIBUNAL ORDER PASSED BY T HE TRIBUNAL ON 28.07.2017. IN THE M.P., IT IS STATED BY THE AO THAT IN WORKING OUT OF TAX EFFECT, SURCHARGE AND CESS SHOULD ALSO BE CONSIDERED AND IF THESE TWO ARE CONSIDERED, THE TOTAL TAX EFFECT IS OF RS. 11,14,157/- WHICH IS NOT BELOW RS. 10 LAKHS AND THEREFORE, IT IS AN APPARENT MISTAKE IN THE TRIBUNAL ORDER AS PER WHICH THE TRIBUNAL HAS DISMISSED THE APPEAL OF REVENUE ON THIS BASIS THAT TAX EFFECT IS BELOW RS. 10 LAKHS. 2. THIS M.P. WAS FIXED FOR HEARING FOR FIRST TIME O N 09.02.2018. ON THIS DATE, NONE APPEARED ON BEHALF OF THE ASSESSEE AND THEREFORE, H EARING WAS ADJOURNED TO 23.02.2018 AND THE DR WAS DIRECTED TO SERVE THE NOT ICE ON THE ASSESSEE. ON 23.02.2018 ALSO, NONE APPEARED ON BEHALF OF THE ASS ESSEE AND NO EVIDENCE WAS BROUGHT ON RECORD BY LD. DR OF REVENUE TO SHOW THAT THE NOTICE WAS SERVED ON THE ASSESSEE. AGAIN THE HEARING WAS ADJOURNED T O 23.03.2018 AND NOTICE OF M.P. NO. 10/BANG/2018 (IN ITA NO. 1082/BANG/2017) PAGE 2 OF 3 HEARING WAS REQUIRED TO BE SERVED ON THE ASSESSEE B Y LD. DR OF REVENUE AND ON THIS DATE ALSO, NEITHER ANY BODY APPEARED ON BEH ALF OF THE ASSESSEE NOR LEARNED DR OF THE REVENUE PRODUCED ANY EVIDENCE OF SERVING OF NOTICE ON THE ASSESSEE. AGAIN THE HEARING WAS ADJOURNED TO 27.04 .2018. ON 27.04.2018 ALSO, NONE APPEARED ON BEHALF OF THE ASSESSEE AND N O EVIDENCE OF SERVICE OF NOTICE WAS BROUGHT ON RECORD BY LD. DR OF REVENUE A ND HENCE, HEARING WAS AGAIN ADJOURNED TO 08.06.2018. ON 08.06.2018 ALSO, NONE APPEARED ON BEHALF OF THE ASSESSEE AND HEARING WAS ADJOURNED TO 22.06. 2018 AND LD. DR OF REVENUE WAS DIRECTED TO SERVE THE HEARING NOTICE ON ASSESSEE. ON 22.06.2018 ALSO, NONE APPEARED ON BEHALF OF THE ASSESSEE AND T HERE IS NO APPEARANCE ON BEHALF OF THE REVENUE ALSO. A LETTER DATED 21.06.2 018 WAS RECEIVED FROM DR SHRI A. RAMESH KUMAR, JCIT, IN WHICH IT IS STATED T HAT HE IS HOLDING ADDITIONAL CHARGE OF BELGAUM RANGE-2 AND SINCE HE HAS FIXED A TOUR PROGRAMME ON 22.06.2018 TO GIVE APPROVAL IN TIME BARRING PENALTY MATTERS, REQUEST WAS MADE FOR ADJOURNMENT. BUT NO ONE WAS PRESENT IN THE COU RT TO PURSUE THIS ADJOURNMENT APPLICATION. MOREOVER, WHEN THE DATE O F HEARING WAS FIXED ON 08.06.2018, TOUR PROGRAMME SHOULD HAVE BEEN MADE KE EPING THE HEARING DATE IN MIND. HENCE, THE ADJOURNMENT APPLICATION WA S REJECTED AND THE M.P. OF THE REVENUE WAS HEARD EX-PARTE QUA THE REVENUE AS W ELL AS QUA THE ASSESSEE. 3. WHEN I EXAMINE THE CLAIM OF THE REVENUE IN THE M .P. THAT SURCHARGE AND CESS IS ALSO TO BE CONSIDERED FOR TAX EFFECT, I FIND THAT L ATEST CBDT CIRCULAR NO. 21/2015 DATED 10.12.2015 HAS BEEN SUBMITTED ALONG WITH THE M.P. IN WHICH IT IS STATED THAT FOR THIS PURPOSE, TAX EFFECT MEANS THE DIFFE RENCE BETWEEN THE TAX ON THE TOTAL INCOME ASSESSED AND THE TAX THAT WOULD HAVE B EEN CHARGEABLE HAD SUCH TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME I N RESPECT OF THE ISSUES AGAINST WHICHAPPEAL IS INTENDED TO BE FILED. PARA 4 OF THIS BOARD CIRCULAR IS REGARDING TAX EFFECT AND THEREFORE, THE SAME IS REP RODUCED HEREINBELOW. 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 INCOME IN RESPECT OF THE ISSUES AGAINST WHICH APPEA L IS INTENDED TO BE FILED (HEREINAFTER REFERRED TO AS 'DISPUTED ISSUES' ). HOWEVER THE TAX WILL NOT INCLUDE ANY INTEREST THEREON, EXCEPT WHERE CHARGEABILITY OF INTEREST ITSELF IS IN DISPUTE. IN CASE THE CHARGEAB ILITY OF INTEREST IS THE M.P. NO. 10/BANG/2018 (IN ITA NO. 1082/BANG/2017) PAGE 3 OF 3 ISSUE UNDER DISPUTE, THE AMOUNT OF INTEREST SHALL B E THE TAX EFFECT. IN CASES WHERE RETURNED LOSS IS REDUCED OR ASSESSED AS INCOME, THE TAX EFFECT WOULD INCLUDE NOTIONAL TAX ON DISPUTED ADDIT IONS. IN CASE OF PENALTY ORDERS, THE TAX EFFECT WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE ORDER TO BE APPEALED AGAINST. 4. FROM THE ABOVE PARA 4 REPRODUCED FROM THIS BOARD CIRCULAR, IT IS SEEN THAT THE SAME IS TALKING ABOUT ONLY TAX AND THEREFORE, THE R EVENUES CLAIM THAT SURCHARGE AND CESS SHOULD ALSO BE INCLUDED IS NOT SUPPORTED B Y THIS BOARD CIRCULAR. EVEN AS PER THE M.P. FILED BY THE REVENUE, THE TAX EFFEC T IS OF RS. 9,93,010/- BEFORE INCLUSION OF SURCHARGE AND CESS. IN THIS VIEW OF T HE MATTER, I HOLD THAT THERE IS NO APPARENT MISTAKE IN THE TRIBUNAL ORDER. 5. IN THE RESULT, THE M.P. FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- (ARUN KUMAR GARODIA) ACCOUNTANT MEMBER BANGALORE, DATED, THE 27 TH JUNE, 2018. /MS/ COPY TO: 1. APPELLANT 4. CIT(A) 2. RESPONDENT 5. DR, ITAT, BANGALORE 3. CIT 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.