I.T.O. Ward 4(3), Nagpur V. SHRI PANNALAL G. SHAHU, Nagpur

MA 20/NAG/2015

• Counselvise Citation: [2016] 124 COUNSELVISE.COM (IT) 4113 (ITAT-NAGPUR)
• Duration Of Justice: 2 month(s) 26 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 26-02-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 30-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: NARENDRA KANE
• Keywords: Retrospective amendment; Question of law; Tax effect

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL NAGPUR BENCH: NAGPUR BEFORE SHRI MUKUL K. SHRAWAT, JUDICIAL MEMBER AND SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER. M.A. NO.20 /NAG/2015 ( IN ITA NO.256/NAG/2014 : AY : 200 9 - 1 0) THE INCOME TAX OFFICER WARD 4(3), NAGPUR VS SHR I PANNALAL G. SHAHU NAGPUR PAN NO.AHF P S7718D (APPLIC ANT) (RESPONDENT) APPLIC ANT BY SHRI NARENDRA KANE, DR RESPONDENT BY SHRI K.P.DEWANI, AR DATE OF HEARING: - 15.01.2016 DATE OF PRONOUNCEMENT: 26 /02/2016 O R D E R PER MUKUL K. SHRAWAT, J.M. TH I S MISCELLANEOUS APPLICATION DATED 30.11.2015 HAS BEEN FILED BY THE RE VENUE DEPARTMENT AGAINST THE ORDER OF THE ITAT, NAGPUR IN THE ITA NO.256/NAG/2014 DTD. 28.08.2015. 2. THE ITAT, NAGPUR HAS DISMISSED THE APPEAL OF THE REVENUE IN LI MINE BECAUSE THE T AX EFFECT WAS LESS THAN THE PRESCRIBED LIMITS AS PER THE CBDT INSTRUCTIONS. THE RELEVANT PORTION OF THE ORDER OF THE ITAT IS REPRODUCED BELOW: - 2. BOTH THE PARTIES ADMITTED BEFORE US THAT THE TAX EFFECT ON THE DISPUTED ISSUES IS LESS THAN RS.4,00,000. IN VIEW OF CBDT INSTRUCTION NO.5/2014 (F.NO.279/MISC.142/2007 - ITJ(PT) DATED 10 TH JULY 2014, THE REVENUE CANNOT FILE ANY APPEAL BEFORE THE TRIBUNAL, WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY LIMIT OF RS.4,00,000/ - UNLESS THE CASE FALLS IN THE EXCEP TIONS. IN THIS REGARD, THE HONBLE BOMBAY HIGH COURT TIME AND AGAIN HELD THAT THE INSTRUCTIONS / CIRCULARS PRESCRIBING MONETARY LIMIT FOR FILING OF THE APPEAL WILL HAVE RETROSPECTIVE EFFECT AND WOULD BE APPLICABLE ON PENDING APPEAL ALSO. 2. HOWEVER, THE HO NBLE BOMBAY HIGH COURT IN THE CASE OF CIT V/S MADHUKAR K. INAMDAR (HUF), [2009] 318 ITR,149 (BOM.) HAS HELD THAT SUCH CIRCULARS ARE APPLICABLE ON PENDING APPEALS ALSO. THE RELEVANT OBSERVATIONS ARE AS UNDER : - 2 MA NO.20/NAG/2015 (IN I TA NO.256/NAG/2014) THE CIRCULAR DATED MAY 15, 2008 IN GENERAL A ND PARAGRAPH (5) THEREOF IN PARTICULAR LAY DOWN THAT EVEN IF THE SAME ISSUE, IN RESPECT OF THE SAME ASSESSEE, FOR OTH ER ASSESSMENT YEARS IS INVOLVED THE DE PARTMENT SHOULD NOT FILE APPEAL, IF THE TAX EFFECT IS LESS THAN RS.4 LAKHS. IN OTHER WORDS, EVEN IF T HE QUESTION OF LAW IS OF RECURRING NATURE, THE REVENUE IS NOT EXPECTED TO FILE APPEALS IN SUCH CASES, IF THE TAX IMPACT IS LESS THAN THE MONETARY LIMIT FIXED BY THE CENTRAL BOARD OF DIRECT TAXES. THE BOARD HAS ALSO ISSUED A CIRCULAR ON JUNE 5, 2007 DIRECTI NG THE DEPARTMENT TO EXAMINE ALL APPEALS PENDING BEFORE THE COURT ON A CASE TO CASE BASIS WITH FURTHER DIRECTION TO WITHDRAW CASES WHEREIN THE CRITERIA OF MONETARY LIMITS AS PER THE PREVAILING INSTRUCTION ARE NOT SATISFIED, UNLESS THE QUESTION OF LAW INVOL VED OR RAISED IN APPEAL OR REFERRED TO THE HIGH COURT FOR OPINION IS OF A RECURRING NATURE REQUIRED TO BE SETTLED BY THE HIGHER COURT. THE CIRCULAR MAKES IT CLEAR THAT ON THE DATE OF ISSUANCE OF THE CIRCULAR, PREVAILING INSTRUCTIONS FIXING MONETARY LIMIT W ILL HOLD GOOD EVEN FOR PENDING CASES. THE CASES REQUIRING THE DEPARTMENT TO WITHDRAW CASES WHEREIN THE TAX EFFECT IS LESS THAN THE PRESCRIBED MONETARY LIMITS. THE CIRCULAR DATED MAY 15, 2008, WOULD BE APPLICABLE TO CASES PENDING BEFORE THE COURT EITHER FOR ADMISSION OR FOR FINAL DISPOSAL AND IT IS BINDING ON THE REVENUE. 3. SIMILAR VIEW WAS TAKEN BY THE HONBLE JURISDICTIONAL HIGH COURT IN THE JUDGMENT IN CIT V/S PITHWA ENGINEERING WORKS, [2005] 276 ITR 519 (BOM.), AND THE HONBLE DELHI HIGH COURT IN M/S. P.S. JAIN & CO., [2011] 335 ITR 591 (DEL.). APPLYING THE PROPOSITIONS LAID DOWN IN THESE CASE LAWS TO THE FACTS OF THE PRESENT CASE, THE REVENUES APPEAL IS NOT MAINTAINABLE AND LIABLE TO BE DISMISSED. 3. HOWEVER REVENUE DEPARTMENT HAS NOW RAISED AN OBJE CTION THAT IN VIEW OF ORDER OF THE HONBLE SUPREME COURT THE AFORE MENTION ORDER OF THE TRIBUNAL MAY BE RECALLED. THE MAIN GRIEVANCE OF THE REVENUE DEPARTMENT IN ITS PETITION IS AS UNDER: - 5. IN THIS CONNECTION, IT IS MOST RESPECTFULLY URGED THAT THE HO NBLE ITAT, NAGPUR MAY PLEASE CONSIDER THE JUDGMENT OF HONBLE SUPREME COURT OF INDIA IN THE CASE OF CIT - VIII, DELHI VS. SUMAN DHAMIJA VIDE ORDER DATED 01.07.2015 IN APPEAL NO.4919 - 4920 OF 2015 SETTING ASIDE THE ORDER OF DELHI HIGH COURT. THE RELEVANT PARA OF THE JUDGMENT IS AS UNDER: - THE APPEALS AND REVIEW PETITIONS PREFERRED BY THE APPELLANTS BEFORE THE HIGH COURTS, WERE DISPOSED OF ON THE BASIS OF THE INSTRUCTIONS ISSUED BY THE CENTRAL BOARD OF DIRECT TAXES DATED 09.02.2011. IT IS NOT A MATTER O F DISPUTE, THAT ALL THE APPEAL WERE PREFERRED PRIOR TO 2011, WHEREAS, THE INSTRUCTIONS DATED 09.02.2011 CLEARLY INDICATE IN PARAGRAPH 11 THEREOF, THAT THEY SHALL NOT GOVERN CASES WHICH HAVE BEEN FILED BEFORE 2011 AND THAT THE SAME WILL GOVERN ONLY SUCH CAS ES WHICH ARE FILED AFTER THE ISSUANCE OF THE AFORESAID INSTRUCTION DATED 09.02.2011. IN VIEW OF THE ABOVE, THE INSTANT APPEALS ARE ALLOWED, THE IMPUGNED ORDERS PASSED BY THE HONBLE HIGH COURT DATED 07.04.2011, 28.02.2011, 26.03.2012 AND 31.05.2012 ARE HER EBY SET ASIDE. THE MATTERS ARE REMITTED BACK TO THE HIGH COURT FOR RE - ADJUDICATION OF THE APPEALS ON MERITS, IN ACCORDANCE WITH LAW. 3 MA NO.20/NAG/2015 (IN I TA NO.256/NAG/2014) THE DEPARTMENT HAS NOT PREFERRED APPEAL U/S.260A AND IT IS MOST RESPECTFULLY URGED THAT THE HONBLE ITAT AMEND ITS ORDER IN THE LIGHT OF THE ABOVE GROUNDS TAKEN . 4 . HAVING HEARD THE SUBMISSION, WE ARE OF THE VIEW THAT THE GRIEVANCE OF THE REVENUE DEPARTMENT IS NOT SUSTAINABLE IN THE EYES OF LAW. FIRSTLY, THIS APPEAL FOR ASSESSMENT YEAR 2009 - 10 WAS FILED BY THE REVENUE DE PARTMENT ON DTD. 06.05.2014. THEREFORE, THE TRIBUNAL HAS APPLIED THE CBDT INSTRUCTIONS AS MENTIONED IN THE ORDER OF THE TRIBUNAL. THE REVENUE I S REFERRING AN ORDER OF THE HONBLE SUPREME COURT BUT THAT ORDER HAD REFERR ED CBDT INSTRUCTIONS DTD. 09.02.2011 , HENCE NOT APPLICABLE IN THIS APPEAL. MOREOVER, IN THE RECENT PAS T CBDT HAS AGAIN ISSUE D AN INSTRUCTION IN CIRCULAR NO. CBDT/21/2015 DATED. 10.12.2015 WHEREIN THE PENDING APPEAL S HAVE ALSO BEEN COVERED. 5 . THEREFORE, THE SECOND REASON FOR DISMISSING THIS P ETITION OF THE REVENUE DEPARTMENT IS THAT IN THE LIGHT OF THE LATEST CBDT INSTRUCTIONS DTD. 10.12.2015 THE POSITION OF THE TAX EFFECT HAS BEEN CLARIFIED AND HENCE THIS APPEAL OF THE REVENUE EVEN CAN BE TREATED A S COVERED BY THE SAID CIRCULAR. ON BOTH THE CO UNTS, THIS PETITION OF THE REVENUE DESERVES TO BE DISMISSED. NO MISTAKE , WHAT T O SAY AN APPARENT MISTAKE HA D BEEN COMMITTED BY THE TRIBUNAL, THEREFORE THIS PETITION OF THE REVENUE IS HEREBY DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON THIS 26 TH DAY OF FEBRUARY , 201 6 . SD / - SD / - (SHAMIM YAHYA) (MUKUL K. SHRAWAT) ACCOUNTANT MEMBER JUDICIAL MEMBER NAGPUR DATED: - 26 /02/2016 MANGESH BODKHE/P.S. 4 MA NO.20/NAG/2015 (IN I TA NO.256/NAG/2014) COPY FORWARDED TO : 1. APPLICANT 2. RESPONDENT 3. C.I.T., CONCERNED 4. CIT ( APPEALS) - I, NAGPUR. 5. D.R., ITAT, NAGPUR. 6. GUARD FILE TRUE COPY BY ORDER ASSISTANT REGISTRAR, INCOME TAX APPELLATE TRIBUNAL, NAGPUR BENCH, NAGPUR.