Income Tax Officer- 2(2), Kanpur V. Smt. Kavita Thakkar, Kanpur

MA 19/LKW/2020

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 3286 (ITAT-LUCKNOW)
• Duration Of Justice: 2 year(s) 5 month(s) 22 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 04-08-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 28-07-2022
• Assessment Year: 2014-2015
• Appeal Filed On: 13-02-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Accommodation entries; Tax effect
• Section: 6; 44AD; 143(3); 5(2)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL LUCKNOW BENCH “A”, LUCKNOW BEFORE SHRI. A. D. JAIN, VICE PRESIDENT AND SHRI T. S. KAPOOR, ACCOUNTANT MEMBER M.A. No.19/Lkw/2020 [In ITA No.144/LKW/2019] Assessment Year: 2014-15 The ITO 2(1) Kanpur v. Smt. Kavita Thakkar 111/39, Ashok Nagar Kanpur TAN/PAN:ADTPT1513F (Applicant) (Respondent) Applicant by: Shri Harish Gidwani, D.R. Respondent by: None Date of hearing: 29 07 2022 Date of pronouncement: 05 08 2022 O R D E R PER A.D. JAIN, V.P.: This is Revenue’s Miscellaneous Application arising out of the order of the Tribunal, dated 22.8.2019 in ITA No.144/LKW/2019 for assessment year 2014-15. 2. The brief facts are that the appeal filed by the Revenue in ITA No.144/LKW/2019 was dismissed on low tax effect, vide order dated 22.8.2019. Aggrieved, the Revenue has filed this Miscellaneous Application, requesting to recall the order of the Tribunal dated 22.8.2019. The application moved by the Revenue is reproduced below verbatim: “The assessee, an individual deriving income from House property (loss), income from business, U/s 44AD and Income from other sources (Interest income), The assessee has also shown Long term capital gain income of Rs.76,02,565/- and the said LTCG has been claimed exempt u/s. 10(38) of the Page 2 of 4 Income Tax Act, 1961, filed her return of income on 31.07.2014 declaring total income of Rs.5,52,740/-, Subsequently, the case was selected for limited scrutiny to examine the issue of suspicious sale transactions in shares. During the course of assessment proceedings it was gathered that the assessee has earned long term capital gains of Rs.76,02,565/-. 2. The department was in possession of material information leading to infer that this share has been marked as penny stock and various person have taken accommodation entries in this share in order to introduced their unaccounted money in their books/as capital etc. as the nature and source of money received by the assessee out of the sales proceeds of penny stocks was held unexplained, the LTCG claimed exempt u/s 10(38) of the act was disallowed and added to the income of the assessee Subsequently, the case was completed on total income of Rs.81,55,300/- after making addition of Rs.76,02,565/- 3. Being aggrieved, the assessee went in appeal before Ld. CIT [A]-I, Kanpur challenging the assessment order passed by the A.O. u/s. 143(3) of the Income Tax Act, 1961. The Ld. CIT(A)-I, Kanpur vide his order dated 27.11.2018 allowed the appeal of the assessee and deleted the above additions made by the A.O. While adjudicating the assessee's appeal the Ld. CIT [Appeals]-I, Kanpur held that in absence of any finding specifically against the assessee in the Investigation Wing report, the assessee cannot be held to be guilty or linked to the wrong acts of any third persons investigated. 4. Against the order of the Ld. CIT (A), the Department preferred an appeal before Hon'ble ITAT Lucknow. Cross objections were also filed by the assessee before the Hon'ble ITAT. The Hon'ble ITAT vide its composite order dated 22.08.2019 [I.T.A. No. 144/LKW/2019 in the instant case] dismissed the appeal of the revenue as non-maintainable on the grounds of being below the enhanced monetary limit of Rs.50,00,000/- as per Board's later Circular No.17/2019 dated 08.08.2019. While dismissing the revenue's appeal the Hon'ble ITAT has placed reliance on the order dated Page 3 of 4 14.08.2019 of the Ahmadabad bench of the ITAT rendered in ITA No. 13987Ahd/2004 etc., in the case of 1TO, Ward-3(2), Ahmadabad Vs. Dinesh Madhavlal Patel, Ahmadabad and Others, by observing as under: "Since the tax effect involved in these appeals, filed by the Department, does not exceed Rs.50 lakhs in each of the appeals, they are not maintainable in view of CBDT's Circular No.17/2019 dated 08.08.2019, F.No. 270/Misc./142/2007-ITJ(Pt.) and is liable to be dismissed as such " 5. The tax effect of arising out of the Hon'ble ITAT's order in this case Rs.23,49,193/- which is below the enhanced monetary limit of Rs.1 Crore for filing of appeal u/s.260A before the Hon'ble High Court as per Board's latest Circular No. 17/2019 dated 08.08.2019. 6. Meanwhile, CBDT, New Delhi vide Circular No.23 of 2019 dated 06.09.2019 and O.M. dated 16.09.2019 has decided that no other outstanding anything contained in any circular issued U/S.268A specifying monetary limits for filing of departmental appeals before the Income Tax Appellate Tribunal [ITAT], High Courts and SLPs/Appeals before the Supreme Court, appeal may be filed on merits as an exception to said circular, where Board, by .way of special order direct filing appeal on merits in cases involved in organized tax evasion activity. 7. In view of the above facts, the Hon'ble ITAT is very kindly requested to re-adjudicate the appeal in the light of CBDT's Circular No.23 of 2019 and O.M. dated 16.09.2019 and pass a suitable order in this case.” 3. None has appeared for the Assessee. However, finding that the matter can be proceeded with in the absence of the Assessee, we are doing so, having heard the ld. D.R. and having perused the material on record. 4. At the time of hearing, the ld. D.R. furnished the copy of Form No.5, i.e., the order, dated 3.6.2022 of the PCIT-1, Kanpur Page 4 of 4 for full and final settlement of tax arrears under section 5(2) read with section 6 of the DTVSVA, 2020 in the case of the assessee and has submitted that the assessee had settled the tax arrears for the Assessment Year 2014-15 under DTVSA, 2020, therefore, the Miscellaneous Application filed by the Revenue be treated as withdrawn in terms of section 4(2) of the DTVSA, 2020. Accordingly, since the assessee had settled the tax arrears for the Assessment Year 2014-15 under DTVSA, 2020, the Miscellaneous Application of the Department is ordered to be dismissed as withdrawn. 5. In the result, the Miscellaneous Application of the Revenue is dismissed. Order pronounced in the open Court on 05/08/2022. Sd/- Sd/- [T. S. KAPOOR] [A. D. JAIN] ACCOUNTANT MEMBER VICE PRESIDENT DATED:05/08/2022 JJ: Copy forwarded to: 1. Appellant 2. Respondent 3. CIT(A) 4. CIT 5. DR By order Assistant Registrar