Income Tax Officer, Damoh V. Shri Ashish Rai, Jabalpur

MA 22/JAB/2019

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 4599 (ITAT-JABALPUR)
• Duration Of Justice: 2 year(s) 3 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 26-04-2022
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2010-2011
• Appeal Filed On: 29-12-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Audit objection; Tax effect; Tax effect; Set aside
• Section: 263; 143(3); 268A

Judgement Text

MA No.22/JAB/2019 (A.Y. 2010-11) ITO vs. Ashish Rai 1 | P a g e IN THE INCOME TAX APPELLATE TRIBUNAL JABALPUR BENCH, JABALPUR (through web-based video conferencing platform) BEFORE SHRI SANJAY ARORA, HON‟BLE ACCOUNTANT MEMBER & SHRI MANOMOHAN DAS, HON'BLE JUDICIAL MEMBER M.A.No. 22/JAB/2019 (arising out of I.T.A. No. 247/JAB/2018) (Asst. Year : 2010-11) Applicant by : Shri S.K. Halder, Sr. DR Respondent by : Dr. H.S. Modh, Advocate Date of hearing : 25/02/2022 Date of pronouncement : 27/04/2022 O R D E R Per Manomohan Das, JM: This is a Miscellaneous Application (MA) preferred by the Revenue against the order dated 23/8/2019 by the Tribunal under section 254(1) of the Income Tax Act, 1961 („the Act‟ hereinafter) vide which the captioned appeal of the Revenue was dismissed by it along with other appeals. 2. The facts of the case are that the assessee filed his return of income by showing total income at Rs. 4,90,870/- and agriculture income of Rs. 2,24,207/-. The Assessing Officer (AO) completed the assessment u/s. 143(3) of the Act vide order dated 18-03-2013 for the assessment year (AY) 2010-11 as income of the assessee at Rs. 6,22,106/- with agriculture income of Rs. 2,24,207/-. This ITO, Damoh. vs. Ashish Rai, H.No. 330, Purana Bazar No.2, Damoh (M.P.) [PAN : AQQPR 9281 G] (Applicant) (Respondent) MA No.22/JAB/2019 (A.Y. 2010-11) ITO vs. Ashish Rai 2 | P a g e assessment was set aside vide order dated 30-03-2015 u/s. 263 directing the AO to pass a fresh assessment order applying correct provisions of the Act. 3. In compliance to the said order u/s. 263, the AO assessed the return of the assessee by applying 3% net profits of gross sales as against the N.P. 34% as was shown by the assessee resulting an addition of Rs. 25,54,067. Being aggrieved, the assessee agitated the assessment by the AO by way of an appeal with the ld. Commissioner of Income Tax (Appeals) (CIT(A)), who vide order dated September 20, 2018 passed u/s. 250(6) partly allowed the appeal of the assessee. This order was appealed against by the Revenue before the Tribunal on 07/12/2018. 4. While the appeal by the Revenue was pending before the Tribunal for disposal, the Central Board of Direct Taxes (CBDT) vide it‟s Instruction No. 17/2019 dated 08-08-2019 u/s. 268A of the Act enhanced the monetary limit for appeals by the Revenue before the Tribunal for filing appeals, references, etc. from the erstwhile Rs. 20 lacs, as per Instruction 03/2018, dated 11/7/2018, to Rs. 50 lakhs. In view of the Instruction of 2019, the Tribunal vide impugned order dismissed 96 appeals by the Revenue, including the captioned appeal, on the ground of low tax effect, i.e., being at below Rs. 50 lakhs. 5. Being aggrieved, the Revenue, vide the captioned M.A. has urged the Tribunal to restore its‟, claiming/raising the following issues: “1. Whether on the facts and circumstances, the Hon‟ble ITAT erred in dismissing the appeal only on the basis of low tax effect as per Board‟s Circular No. 17/2019 dated 08-08-2019 and exceptional clause of para 10(c) of Circular No. 3/2018 dated 11-07-2018.” 6. As per para 10(c) of the CBDT‟s Instruction No. 03/2018, which is the parent Instruction in the matter, which continues to be applicable, where revenue audit objection in the case has been accepted by the Department, adverse judgment relating to the issue would be liable to be contested on merits. MA No.22/JAB/2019 (A.Y. 2010-11) ITO vs. Ashish Rai 3 | P a g e The Revenue submits that the Bench had asked the DR to submit copy of the audit objection in another case where prayer for restoration of its‟ appeal was similarly made,. Therefore, in this case also, the copy of the Audit objection and acceptance of audit objection by the AO are being submitted herewith before the Hon‟ble ITAT for necessary consideration and restoration of the case for hearing on merits. 7. We have heard both the parties, and perused the material on record. 7.1 It is the claim of the Revenue that its captioned appeal has been wrongly dismissed as withdrawn/not pressed per the impugned order inasmuch as, though the tax effect is below the threshold monetary limit for filing of appeals by the Revenue, it is covered by the exception contained at para 10(c) of its Circular 03/2018 dated 11-07-2018. Clause (c) of para 10 speaks of cases covered by the revenue audit objection. The assessment in the instant case being consequent to an audit objection, the Revenue‟s appeal is excepted and, thus, do not fall u/s 268A of the Act. Information qua the same is on record in the form of an authorisation memo u/s. 253(2) of the Act. 7.2 It is true that the Tribunal vide dated 23-08-2019 dismissed 96 appeals of the Revenue including the instant appeal without affording any opportunity to the Revenue to clarify if its‟ appeal under reference was indeed covered u/s. 268A of the Act. And, it is for this reason that it, vide para 7 of impugned order, reproduced as under, provided both the parties an opportunity to move it in case any error had been committed by it in disposing the appeals u/s. 268A and prejudice caused thereby: “7. It may be clarified that though every care has been taken by the Registry of the Tribunal in identifying the listed appeals, it may yet be that some error in working the tax effect may have occurred. It may also be that an appeal/s is otherwise saved by the exceptions listed at para 10 (scope of which stands widened vide amendment dated 20-08-2018) or para 11 of the Circular. Similarly, it may be that a CO/s bears an independent ground/s raised for adjudication. Accordingly, liberty is hereby granted to the parties to, where so, MA No.22/JAB/2019 (A.Y. 2010-11) ITO vs. Ashish Rai 4 | P a g e move the Tribunal in this regard, in which case it shall, where satisfied on merits, recall an appeal/s or, as the case may be, a CO/s, for being heard on merits. Further, the recall of an appeal would be accompanied by the recall of the assessee‟s corresponding CO, if any, dismissed along with. Needless to add, the Tribunal shall, while doing so, which shall be part a speaking order, grant an opportunity of hearing to the other side. 8. In view of the foregoing, we are satisfied that the instant appeal of the Revenue warrants restoration, and we direct so by recalling Tribunal‟s order dated 23-08-2019 in respect of the Revenue‟s captioned appeal. The Registry is directed to fix this appeal for hearing before the appropriate Bench of the Tribunal in the normal course.[ 9. In the result, Revenue‟s MA is allowed. Order Pronounced in open Court on April 27, 2022. Sd/- sd/- (Sanjay Arora) (Manomohan Das) Accountant Member Judicial Member Dated: 27/04/2022 vr/- Copy to: 1. The Appellant - ITO, Damoh. 2. The Respondent – Ashish Rai, H.No. 330, Purana Bazar No.2, Damoh (M.P.) 3. The Pr .CI T-1, Jabalpur (MP) 4. The CI T( A)-1, Jabalpur. 5. The Sr .D.R ., ITAT, Jablapur 6. Guard File By order (VUKKEM RAMBABU) Sr. Private Secretary, ITAT, Jabalpur.