Asst. Commissioner of Wealth Tax, Circle-1, Anantapur V. J C Renuka Devi, Anantapur

MA 27/Hyd/2020

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 3517 (ITAT-HYDERABAD)
• Duration Of Justice: 11 month(s) 1 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 07-06-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB-A
• Assessment Year: 2010-2011
• Appeal Filed On: 06-07-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SUNIL KUMAR PANDEY
• Assessee Lawyers: K A SAI PRASAD
• Keywords: Tax effect
• Section: 201; 73; 13; 27; 10; 2; 11

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD A BENCH, HYDERABAD. BEFORE S MT. P. MADHAVI DEVI , JUDICIAL M EMB ER AND SHRI L.P. SAHU , ACCOUNTANT MEMBER (THROUGH VIRTUAL HEARING) M.A.NOS.27 TO 30/HYD/2020 (IN W TA NO S . 70 TO 73 /HYD/2018 (ASSESSMENT YEAR S : 20 10 - 11 TO 2013 - 14 ) ASST. COMMISSIONER OF WEALTH TAX, CIRCLE 1, ANANTAPUR. VS. SMT. J.C. RENUKA DEVI, NO.8 - 48/49, RENUKA GATED COMMUNITY, JNTU ROAD, ANANTAPUR. PAN AGCPR 9548Q APPELLANT RESPONDENT APPELLANT BY : SHRI SUNIL KUMAR PANDEY (D.R) RESPONDENT BY : SHRI K. A. SAI PRASAD. DATE OF HEARING : 23.04. 2021. DATE OF PRONOUNCEMENT : 07 .0 6 .2021. O R D E R PER S MT. P. MADHAVI DEVI , J.M. : THESE MISC. APPLICATIONS ARE FILED BY THE REVENUE SEEKING RECALL OF THE ORDERS OF THE TRIBUNAL DT.26.08.2019 PASSED IN WTA NOS.70 TO 73/HYD/2018 RESPECTIVELY , DISMISSING THE REVENUES APPEALS ON ACCOUNT OF LOW TAX EFFECT. 2 M.A. NO S . 27 TO 30/HYD/2020 2. THESE MAS ARE FILED U/S.35 OF WEALTH TAX ACT FOR RECALL OF TRIBUNALS ORDER IN ALL THE RELEVANT APPEALS ON IDENTICAL GROUNDS STATING AS UNDER : I) THAT I AM THE ASSISTANT COMMISSIONER OF WEALTH TAX, CIRDE - 1, KURNOOL AND I AM WELL ACQUAINTED WITH THE FACTS AND CIRCUMSTANCES OF THE CASE. THE JURIS DICTION OVER THE ABOVE CASE VESTS WITH THE ASSISTANT COMMISSIONER OF WEALTH TAX, CIRCLE - 1, KURNOOL. I I] THAT THE HON'BLE INCOME TAX APPELLATE TRIBUNAL, 'A' BENCH, HYDERABAD, PASSED AN ORDER IN W.T.A. NO.70/HYD/2018, DATED 26/08/2019 FOR THE ASST. YEAR 2010 - 11, IN THE CASE OF I .E. RENUKA DEVI, ANANTAPUR. III) THAT AS PER THE CSDT CIRCULAR NO.03/2018, DATED 11/07/2018 AND CIRCULAR NO.17 OF 2019, DATED 8TH AUGUST, 2019, THE TAX LIMIT FOR FILING OF APPEAL BY THE REVENUE BEFORE THE TRIBUNAL HAS BEEN FIXED AT RS. 50.00 LAKHS. SINCE THE TAX EFFECT IN TH I S APPEAL IS LESS THAN RS. 5 O.OO LAKHS, THE HON'BLE ITAT HAS DISMISSED THE SAME ON ACCOUNT OF LOW TAX EFFECT WITH THE LIBERTY TO THE REVENUE TO SEEK RECALL OF THE ORDER, IF ANY OF THESE APPEALS FALLS WITHIN THE EXCEPT IONS MENTIONED IN THE CIRCULARS CITED ABOVE . I V ) THAT AS PER THE CIRCULAR NO.03/20L8, DATED 11 JULY, 2018, THE APPEALS BEFORE THE LTAT. SHALL NOT BE FILED IN CASES WHERE THE TAX EFFECT DOES NOT EXCEED THE MONETARY LIMITS OF RS.20.00 LAKHS. FURTHER, AS PER PARA 2 OF CIRCULAR NO.5/2019, DATED 5 TH FEBRUARY, 2019, THE E.S.D.T. HAS ALSO EXTENDED THE SCOPE OF CIRCULAR NO.3/20L8 FOR THE MONETARY LIMITS FOR FILING /WITHDRAWAL OF WEALTH TAX APPEALS BY THE DEPARTMENT BEFORE THE ITAT . V) I SUBMIT THAT THE C. B .D.T. HA S ISSUED THE CIRCULAR NO.17/2019, DATED 08/08/2019, REGARDING THE EXTENSION OF MONETARY LIMITS TO INCOME TAX CASES ONLY FOR FILING OF APPEAL / WITHDRAWAL OF APPEAL BY THE DEPARTMENT. VI) I SUBMIT THAT THE C.8.D.T. HAS NOT ISSUED ANY CIRCULAR AFTER THE ISSU E OF CIRCULAR NO.17 /2019, DATED 08/08/2019, REGARDING THE EXTENSION OF MONETARY LIMITS TO WEALTH TAX CASES FOR FILING OF APPEAL/WITHDRAWAL OF APPEAL BY THE DEPARTMENT. 3 M.A. NO S . 27 TO 30/HYD/2020 VII) THAT INITIALLY MISCELLANEOUS PETITION WAS FILED UNDER SECTION 24 OF THE WEALTH TAX ACT 1957 AND THE SAME OUGHT TO HAVE BEEN FILED UNDER SECTION 3 5 OF THE (WEALTH TAX ACT 1957. HENCE A FRESH PETITION UNDER SECTION 3 5 IS BEING FILED. V III) IT IS SUBMITTED THAT THE EARLIER MISCELLANEOUS APPLICATION WAS FILED BEFORE THE ITAT., HYDERABAD, AF TER OBTAINING THE NECESSARY DIRECTIONS FROM THE PRINCIPAL COMMISSIONER OF INCOME TAX, TIRUPATI VIDE LETTER IN F.NO. ITAT/PR.C1T/TPT/2019 - 20, DATED 09/03/2020 RECEIVED ON 19/03/2020. IX ) IN THE CIRCUMSTANCES, IT IS PRAYED THAT THE ORDER OF THE HON'BLE INCOM E TAX APPELLATE TRIBUNAL IN WTA NO.70/HYD/2018, DATED 26/08/2019 MAY BE RECALLED AND THE GROUNDS OF APPEAL ( FORMING PART OF AUTHORIZATION U/S.24 ( 2 ) OF THE WEALTH TAX ACT, 1957 ) FILED BY THE REVENUE ( COPY ENCLOSED ) ON 20/09/2018, BE RESTORED. 3. THE LE ARNED DR RELIED UPON CIRCULAR NO.5 OF 20 1 9 DT.5.2.2019 AND SUBMITTED THAT THE MONETARY LIMIT OF TAX EFFECT FOR FILING APPEALS BY THE DEPARTMENT DOES NOT APPLY TO THE WEALTH TAX APPEALS AND THEREFORE THE ORDER OF THE TRIBUNAL DISMISSING THE DEPARTMENT APPEALS IN WEALTH TAX MATTERS IS ENRRONEOUS AND NEEDS TO BE RECALLED, AND ADJUDICAT ED ON MERITS. 4. THE LEARNED COUNSEL FOR THE ASSESSEE , ON THE OTHER HAND, SUBMITTED THAT THE MONETARY LIMITS OF TAX EFFECT MENTIONED IN THE CIRCULAR IS VERY MUCH APPLICABLE TO THE WEALTH TAX APPEALS ALSO. HE SUBMITTED THAT IN THE YEAR 2015, CIRCULAR NO.21 OF 2015 DT.10.12.2015 WAS ISSUED WHEREIN THE MONETAR Y LIMITS OF TAX EFFECT WERE FIXED AT RS.10 LAKHS, RS.20 LAKHS AND RS.25 LAKHS FOR FILING OF INCOME TAX APPEALS BY THE DEPARTMENT BEFORE THE APPELLATE TRIBUNAL, HON'BLE HIGH COURTS AND HONBLE 4 M.A. NO S . 27 TO 30/HYD/2020 SUPREME COURT RESPECTIVELY. HE SUBMITTED THAT AS PER PARA 13 OF THIS CIRCULAR, THE MONETARY LIMITS MENTIONED THEREIN WERE APPLICABLE TO THE PENDING APPEALS WHICH WERE TO BE WITHDRAWN AS NOT PRESSED. THEREAFTER, THE CIRCULAR NO.3 OF 2018, DT.11.07.2018 WAS ISSUED WHEREIN THE MONETARY LIMITS WERE RAISED TO RS.20 LAKHS, RS.50 LAKHS AND RS.1 CRORE RESPECTIVELY. HE SUBMITTED THAT THEREAFTER CIRCULAR NO.5 OF 2019 WAS ISSUED WHEREIN THERE IS A REFERENCE TO CIRCULAR NO.3 OF 2018 AND IT WAS CLARIFIED THAT THE CIRCULAR NO. 3 OF 201 8 OF CBDT SHALL ALSO APPL Y TO WEALTH TAX MATTER S IN MUTATIS MUTANDI S MANNER AND WITH MODI FICATIONS AS PRESCRIBED THEREUNDER . F OR THE PURPOSE OF CLARITY AND READY REFERENCE, THE RELEVANT CIRCULAR IS REPRODUCED HEREUNDER : WEALTH TAX APPEALS, IT WAS CLARIFIED AS UNDER : CIRCULAR NO.5/2019 F. NO . 279/MISC/M - 84/2018 - ITJ GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE CENTRAL BOARD DIRECT TAXES JUDICIAL SECTION NEW DELHI, 5TH FEBRUARY 2019 SUBJECT: - MONETARY LIMITS FOR FILING/WITHDRAWAL OF WEALTH TAX APPEALS BY THE DEPARTMENT BEFORE ITAT, HCS AND SLPS/APPEALS BEFORE SC THROUGH EXTENDING THE SCOPE OF CIRCULAR 3 OF 2018 - MEASURES FOR REDUCING LITIGATION. REFERENCE IS INVITED TO BOARD'S CIRCULAR NO. 3 OF 2018 DATED 11.07.2018 (HEREINAFTER, REFERRED TO AS 'THE CIRCULAR') VIDE WHICH MONE TARY LIMITS FOR FILING OF INCOME TAX APPEALS BY THE DEPARTMENT BEFORE INCOME TAX APPELLATE TRIBUNAL, HIGH COURTS AND SLPS/ APPEALS BEFORE SUPREME COURT WERE SPECIFIED. PARA 11 OF THE CIRCULAR STATES THAT THE MONETARY LIMITS SPECIFIED IN PARA 3 SHALL NOT AP PLY TO WRIT MATTERS AND DIRECT TAX MATTERS OTHER THAN INCOME TAX AND FILING OF APPEALS IN SUCH CASES SHALL CONTINUE TO BE GOVERNED BY RELEVANT PROVISIONS OF STATUTE AND RULES. 5 M.A. NO S . 27 TO 30/HYD/2020 2. THERE IS NO CHARGE UNDER WEALTH TAX ACT, 1957 W.E.F 1 ST APRIL, 2016. THEREF ORE, AS A STEP TOWARDS LITIGATION MANAGEMENT, IT HAS BEEN DECIDED BY THE BOARD THAT MONETARY LIMITS FOR FILING OF APPEALS IN INCOME TAX CASES AS PRESCRIBED IN PARA 3 OF THE CIRCULAR SHALL ALSO APPLY TO WEALTH TAX APPEALS THROUGH EXTENSION OF THE CIRCULAR T O WEALTH TAX MATTERS IN A MUTATIS MUTANDIS MANNER AND WITH MODIFICATIONS AS PRESCRIBED HEREUNDER. 3. FOR THE PURPOSE OF WEALTH TAX APPEALS: A. PARA 4 OF THE CIRCULAR SHALL BE READ AS FOLLOWS : 'FOR THIS PURPOSE, 'TAX EFFECT' MEANS THE DIFFERENCE BETWEEN THE TAX ON NET WEALTH ASSESSED AND THE TAX THAT WOULD HAVE BEEN CHARGEABLE HAD SUCH NET WEALTH BEEN REDUCED BY THE AMOUNT OF WEALTH IN RESPECT OF THE ISSUES AGAINST WHICH APPEALS IS INTENDED TO BE FILED. HOWEVER, THE TAX WILL NOT INCLUDE ANY INTEREST THER EON, EXCEPT WHERE CHARGEABILITY OF INTEREST ITSELF IS IN DISPUTE. IN CASE THE CHARGEABILITY OF INTEREST IS THE ISSUE UNDER DISPUTE, THE AMOUNT OF INTEREST SHALL BE THE TAX EFFECT. IN CASE OF PENALTY ORDERS, THE TAX EFFECT WILL MEAN QUANTUM OF PENALTY DELE TED OR REDUCED IN THE ORDER TO BE APPEALED AGAINST.' B. PARA 11 OF THE CIRCULAR SHALL READ AS FOLLOWS. 'THE MONETARY LIMITS SPECIFIED IN PARA 3 ABOVE SHALL NOT APPLY TO WRIT MATTERS. ' 4. THE SAID EXTENSION OF THE CIRCULAR TO WEALTH TAX APPEALS SHALL COME INTO EFFECT FROM THE DATE OF ISSUE OF THIS CIRCULAR. 5. THE SAME MAY BE BROUGHT TO THE NOTICE OF ALL CONCERNED. 6. HINDI VERSION WILL FOLLOW. 5 . HE HAS ALSO DRAWN OUR ATTENTIO N TO THE DECISION OF THE A BENCH OF THE TRIBUNAL AT AHMEDABAD IN THE CASE OF ITO VS. D INESH MADHAVLAL PATEL IN ITA NO. 1398/AHD/2004 DT. 14.08.2019 WHEREIN THE TRIBUNAL HAS HELD AS UNDER : 5 . HAVING CONSIDERED THE RIVAL SUBMISSIONS AND HAVING PERUSED THE MATERIAL ON RECORD, WE DO NOT HAVE SLIGHTEST OF HESITATION IN HOLDING THAT THE CONCESSION EXTENDED BY THE CBDT NOT ONLY APPLIES TO THE APPEALS TO BE FILED IN FUTURE BUT IT IS ALSO EQUALLY APP LICABLE TO THE APPEALS PENDING FOR DISPOSAL AS ON NOW. OUR LINE OF REASONING IS THIS. THE CIRCULAR DATED 8TH AUGUST 2019 IS NOT A STANDALONE CIRCULAR. IT IS TO BE READ IN CONJUNCTION WITH THE CBDT CIRCULAR NO 3 OF 2018 (AND SUBSEQUENT AMENDMENT THERETO), A ND ALL IT DOES IS TO REPLACE PARAGRAPH NOS. 3 AND 5 OF THE SAID CIRCULAR. THIS IS EVIDENT FROM THE FOLLOWING EXTRACTS FROM THE CIRCULAR DATED 8TH AUGUST 2019: 2. AS A STEP TOWARDS FURTHER MANAGEMENT OF LITIGATION. IT HAS BEEN DECIDED BY THE BOARD THAT MO NETARY LIMITS FOR FILING OF APPEALS IN INCOME - TAX CASES BE ENHANCED FURTHER THROUGH AMENDMENT IN PARA 3 OF THE CIRCULAR MENTIONED ABOVE AND ACCORDINGLY. THE TABLE FOR MONETARY LIMITS SPECIFIED IN PARA 3 OF THE CIRCULAR SHALL READ AS FOLLOWS: S.NO . APPEALS/SLPS IN INCOME - TAX MATTERS MONETARY LIMIT (RS.) 1 BEFORE APPELLATE TRIBUNAL 50,00,000 2 BEFORE HIGH CO URT 1,00,00,000 3 BEFORE SUPREME COURT 2,00,00,000 6 M.A. NO S . 27 TO 30/HYD/2020 3. FURTHER, WITH A VIEW TO PROVIDE PARITY IN FI LING OF APPEALS IN SCENARIOS WHERE SEPARATE ORDER IS PASSED BY HIGHER APPELLATE AUTHORITIES FOR EACH ASSESSMENT YEAR VIS - A - VIS WHERE COMPOSITE ORDER FOR MORE THAN ONE ASSESSMENT YEARS IS PASSED. PARA 5 OF THE CIRCULAR IS SUBSTITUTED BY THE FOLLOWING PARA: 5. THE ASSESSING OFFICER SHALL CALCULATE THE TAX EFFECT SEPARATELY FOR EVERY ASSESSMENT YEAR IN RESPECT OF THE DISPUTED ISSUES IN THE CASE OF EVERY ASSESSEE. IF IN THE CASE OF AN ASSESSEE, THE DISPUTED ISSUES ARISE IN MORE THAN ONE ASSESSMENT YEAR, APPE AL CAN BE FILED IN RESPECT OF SUCH ASSESSMENT YEAR OR YEARS IN WHICH THE TAX EFFECT IN RESPECT OF THE DISPUTED ISSUES EXCEEDS THE MONETARY LIMIT SPECIFIED IN PARA 3. NO APPEAL SHALL BE FILED IN RESPECT OF AN ASSESSMENT YEAR OR YEARS IN WHICH THE TAX EFFECT IS LESS THAN THE MONETARY LIMIT SPECIFIED IN PARA 3. FURTHER, EVEN IN THE CASE OF COMPOSITE ORDER OF ANY HIGH COURT OR APPELLATE AUTHORITY WHICH INVOLVES MORE THAN ONE ASSESSMENT YEAR AND COMMON ISSUES IN MORE THAN ONE ASSESSMENT YEAR NO APPEAL SHALL BE F ILED IN RESPECT OF AN ASSESSMENT YEAR OR YEARS IN WHICH THE TAX EFFECT IS LESS THAN THE MONETARY LIMIT SPECIFIED IN PARA 3. IN CASE WHERE A COMPOSITE ORDER/ JUDGEMENT INVOLVES MORE THAN ONE ASSESSEE, EACH ASSESSEE SHALL BE DEALT WITH SEPARATELY 4. THE S AID MODIFICATIONS SHALL COME INTO EFFECT FROM THE DATE OF ISSUE OF THIS CIRCULAR. 6. CLEARLY, ALL OTHER PORTIONS OF THE CIRCULAR NO. 3 OF 2018 (SUPRA) HAVE REMAINED INTACT. THE PORTION WHICH HAS REMAINED INTACT INCLUDES PARAGRAPH 13 OF THE AFORESAI D CIRCULAR WHICH IS AS FOLLOWS: 13. THIS CIRCULAR WILL APPLY TO SLPS/ APPEALS/ CROSS OBJECTIONS/ REFERENCES TO BE FILED HENCEFORTH IN SC/HCS/TRIBUNAL AND IT SHALL ALSO APPLY RETROSPECTIVELY TO PENDING SLPS/ APPEALS/ CROSS OBJECTIONS/REFERENCE S. PENDING APPEALS BELOW THE SPECIFIED TAX LIMITS IN PARE 3 ABOVE MAY BE WITHDRAWN/ NOT PRESSED. 7. IN VIEW OF THE ABOVE DISCUSSIONS, WE HEREBY HOLD THAT THE RELAXATION IN MONETARY LIMITS FOR DEPARTMENTAL APPEALS, VIDE CBDT CIRCULAR DATED 8TH AUGUST 2 019 (SUPRA) SHALL BE APPLICABLE TO THE PENDING APPEALS IN ADDITION TO THE APPEALS TO BE FILED HENCEFORTH. THEREFORE , ACCORDING TO THE LEARNED COUNSEL FOR THE ASSESSEE , THE CBDT CIRCULAR 3 OF 2018 AND THE SUBSEQUENT CIRCULARS ARE APPLICABLE TO THE PENDING WEALTH TAX APPEALS ALSO AND THEREFORE THESE WEALTH TAX APPEALS WE RE RIGHTLY DISMISSED ON ACCOUNT OF LOW TAX EFFECT. HE THUS PRAYED FOR DISMISSAL OF THESE M.AS. 6 . HAVING REGARD TO THE RIVAL CONTENTIONS AND CONSIDERING THE MATERIAL ON RECORD, WE FIND THAT U/S. 35 OF THE WEALTH TAX ACT, THE ORDER OF THE TRIBUNAL CAN BE RECALLED IF AN APPLICATION IS FILED WITHIN 4 YEARS FROM THE END OF FINANCIAL YEAR IN WHICH THE 7 M.A. NO S . 27 TO 30/HYD/2020 ORDER IS PASSED, P ROVIDED THERE IS A MISTAKE APPARENT FROM RECORD. WE FIND THAT VIDE ORDER OF TRIBUNAL DT.26.08.2019 , THE REVENUES WEALTH TAX APPEALS WERE DISMISSED BY FOLLOWI NG THE CBDT CIRCULAR NO.3 OF 2018 DT.11.7.2018 AND CIRCULAR NO.17 OF 2019 DT.9.8.2019 . AS RIG HTLY POINTED OUT BY THE LEARNED COUNSEL FOR THE ASSESSEE, BY VIRTUE OF CIRCULAR 5 OF 2019, THE CIRCULAR NO.3 OF 2018 HAS BEEN MADE APPLICABLE TO THE WEALTH TAX APPEALS ALSO . THEREFORE , AT THE TIME, WHEN THE TRIBUNAL PASSED THE ORDER, THE TAX LIMIT FOR FIL ING OF APPEALS BY REVENUE BEFORE THE TRIBUNAL WAS RS.50 LAKHS ONLY AND THE TAX EFFECT IN ALL OF THESE APPEALS WAS LESS THAN RS.50 LAKHS. FURTHER, W.E.F. 1.4.2016, THERE IS NO CHARGE UNDER THE WEALTH TAX ACT. THEREFORE , THERE IS NO MISTAKE APPARENT FROM R ECORD IN THE ORDERS OF THE TRIBUNAL IN DISMISSING THE APPEALS OF THE REVENUE IN THESE CASES AND ACCORDINGLY M.A S ARE DISMISSED. 7 . IN THE RESULT, THE M.A S ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 7TH JUNE , 2021. SD/ - SD/ - ( L.P. SAHU ) ( SMT. P. MADHAVI DEVI ) ACCOUNTANT MEMBER JUDICIAL MEMBER HYDERABAD, DT. 07 .0 6 . 2021. * REDDY GP 8 M.A. NO S . 27 TO 30/HYD/2020 COPY TO : 1. SMT. J.C. RENUKA DEVI, NO.8 - 48/49, RENUKA GATED COMMUNITY, JNTU ROAD, ANANTAPUR. 2. ACWT, CIRCLE - 1, ANANTAPUR. 3. PR. C I T , KURNOOL. 4. C W T(APPEALS) , KURNOOL . 5. DR, ITAT, HYDERABAD. 6. GUARD FILE. BY ORDER SR. PVT. SECRETARY, ITAT, HYDERABAD.