ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-2, Alwar V. SHRI KAILSH LAL AGARWAL, Alwar

MA 29/JPR/2020

• Counselvise Citation: [2020] 110 COUNSELVISE.COM (IT) 7084 (ITAT-JAIPUR)
• Duration Of Justice: 6 month(s) 15 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-08-2020
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2012-2013
• Appeal Filed On: 10-02-2020
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: S L PODDAR DHK
• Keywords: Audit objection; Tax effect
• Section: 201

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH VC , JAIPUR JH FOT; IKY JKWO] U;KF;D LNL; ,O A JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI VIJAY PAL RAO, JM & SHRI VIKRAM SINGH YADAV, AM M.A. NO. 29/JP/2020 ( ARISING OUT OF VK;DJ VIHY LA-@ ITA NO. 97/JP/2019) FU/KZKJ.K O'K Z@ ASSESSMENT YEAR : 2012-13. ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-2, ALWAR. CUKE VS. SHRI KISHAN LAL AGARWAL PROP. M/S. SHREE BALAJI CATTLE FEED, G-112, RIICO INDUSTRIAL AREA, BEHROR, DISTT. ALWAR. LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN NO. AEYPA 8480 Q VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT JKTLO DH VKSJ LS@ REVENUE BY : SMT. RUNI PAL (ADDL.CIT) FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI S.L. PODDAR (ADVOCATE) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 21.08.2020. ?KKS'K .KK DH RKJH[K@ DATE OF PRONOUNCEMENT : 25/08/2020. VKNS'K@ ORDER PER VIJAY PAL RAO, JM : BY WAY OF THIS MISCELLANEOUS APPLICATION THE REVENU E IS SEEKING RECALLING OF TRIBUNALS ORDER DATED 04.10.2019 WHEREBY THE APPEA L OF THE REVENUE WAS DISMISSED ON THE GROUND OF LOW TAX EFFECT IN VIEW OF THE MONE TARY LIMITS PROVIDED IN CBDT CIRCULAR NO. 3 OF 2018 DATED 11.07.2018 WHICH WAS R EVISED BY CIRCULAR NO. 17 OF 2019 DATED 08.08.2019. THE REVENUE HAS POINTED OUT THAT THE ASSESSMENT ORDER WAS PASSED BY THE AO BASED ON AUDIT OBJECTIONS, THE REFORE, THE PRESENT CASE FALLS IN THE EXCEPTION UNDER PARA 10(C) OF CIRCULAR NO. 3/20 18 DATED 11.07.2018. 2. WE HAVE HEARD THE LD. D/R AS WELL AS LD. A/R AND CONSIDERED THE RELEVANT MATERIAL ON RECORD. THE LD. D/R HAS PRODUCED THE C OPY OF AUDIT OBJECTION WHEREIN THE AUDIT PARTY HAS POINTED OUT THE FACT THAT THE A SSESSEE HAS GIVEN LOANS TO CERTAIN 2 MA NO. 29/JP/2020 SHRI KISHAN LAL AGARWAL, ALWAR. PARTIES WITHOUT CHARGING INTEREST WHEREAS THE ASSES SEE IS PAYING INTEREST AMOUNTING TO RS. 10,09,536/-. THE LD. A/R OF THE ASSESSEE HAS SUBMITTED THAT THE ASSESSEE HAS COME TO KNOW ABOUT THIS FACT THAT THE ASSESSMENT WA S REOPENED BY THE AO BASED ON THE AUDIT OBJECTION FIRST TIME WHEN THE MISCELLANEO US APPLICATION HAS BEEN FILED BY THE REVENUE. THUS THE LD. A/R HAS SUBMITTED THAT TH E ASSESSEE HAS RIGHT TO RAISE THE OBJECTION AGAINST VALIDITY OF REOPENING OF THE ASSE SSMENT. 3. HAVING CONSIDERED THE RIVAL SUBMISSIONS, AT THE OUTSET, WE NOTE THAT THE APPEAL OF THE REVENUE WAS DISMISSED BEING NOT MAINT AINABLE DUE TO LOW TAX EFFECT AS PER THE MONETARY LIMITS PROVIDED IN THE AMENDED CBD T CIRCULAR NO. 3 OF 2018 VIDE CIRCULAR NO. 17 OF 2019 DATED 08.08.2019. PARA 10 OF THE CIRCULAR CURBS OUT THE VARIOUS EXCEPTIONS WHERE THE MONETARY LIMIT IS NOT APPLICABLE WHICH READS AS UNDER :- 10. ADVERSE JUDGMENTS RELATING TO THE FOLLOWING ISS UES SHOULD BE CONTESTED ON MERITS NOTWITHSTANDING THAT THE TAX EFFECT ENTAILED IS LES S THAN THE MONETARY LIMITS SPECIFIED IN PARA 3 ABOVE OR THERE IS NO TAX EFFECT: (A) WHERE THE CONSTITUTIONAL VALIDITY OF THE PROVIS IONS OF AN ACT OR RULE IS UNDER CHALLENGE, OR (B) WHERE BOARD'S ORDER, NOTIFICATION, INSTRUCTION OR CIRCULAR HAS BEEN HELD TO BE ILLEGAL OR ULTRA VIRES, OR (C) WHERE REVENUE AUDIT OBJECTION IN THE CASE HAS B EEN ACCEPTED BY THE DEPARTMENT, OR (D) WHERE THE ADDITION RELATES TO UNDISCLOSED FOREI GN INCOME/UNDISCLOSED FOREIGN ASSETS (INCLUDING FINANCIAL ASSETS)/UNDISCLOSED FOREIGN BA NK ACCOUNT. (E) WHERE ADDITION IS BASED ON INFORMATION RECEIVED FROM EXTERNAL SOURCES IN THE NATURE OF LAW ENFORCEMENT AGENCIES SUCH AS CBI/ED/DRI/SFIO/DI RECTORATE GENERAL OF GST INTELLIGENCE (DGGI) 3 MA NO. 29/JP/2020 SHRI KISHAN LAL AGARWAL, ALWAR. (F) CASES WHERE PROSECUTION HAS BEEN FILED BY THE D EPARTMENT AND IS PENDING IN THE COURT. AS PER CLAUSE (C) OF PARA 10 OF THE CIRCULAR IT IS CLEAR THAT WHERE THE REVENUE AUDIT OBJECTION IN CASE OF AN ASSESSEE HAS BEEN ACCEPTED BY THE DEPARTMENT, THE APPEAL OF THE REVENUE HAS TO BE DECIDED ON MERITS IRRESPEC TIVE OF THE LOW TAX EFFECT. NOW IT IS FACT ON RECORD THAT THE AUDIT OBJECTION WAS ACCE PTED BY THE DEPARTMENT AND THE AO HAS DISALLOWED INTEREST EXPENDITURE AS POINTED O UT BY THE AUDIT BRANCH OF THE REVENUE. THEREFORE, WE FIND THAT THE APPEAL OF THE REVENUE FALLS IN THE EXCEPTION AS PROVIDED IN PARA 10(C) OF THE CIRCULAR NO. 3 OF 201 8. ACCORDINGLY, WE RECALL THE IMPUGNED ORDER DATED 04.10.2019 AND RESTORE THE APP EAL OF THE REVENUE AT ITS ORIGINAL NUMBER AND STAGE. THE REGISTRY IS DIRECTE D TO LIST THE APPEAL OF THE REVENUE FOR HEARING ON 9 TH OCTOBER, 2020. THE ASSESSEE SHALL HAVE A LIBERTY TO RAISE THE OBJECTION, IF ANY AGAINST THE DECISION OF THE AO BA SED ON THE AUDIT OBJECTION. THE NEXT DATE OF HEARING IS ANNOUNCED IN THE OPEN COURT AND NOTED DOWN BY THE PARTIES, THEREFORE, NO SEPARATE NOTICE OF HEARING SHALL BE I SSUED. 4. IN THE RESULT, MISCELLANEOUS APPLICATION FILED B Y THE REVENUE IS ALLOWED. ORDER IS PRONOUNCED IN THE OPEN COURT ON 25/08 /2020. SD/- SD/- ( FOE FLAG ;KNO ) ( FOT; IKY JKWO ( VIKRAM SINGH YADAV ) (VIJAY PAL RAO) YS[KK LNL;@ ACCOUNTANT MEMBER U;KF;D LNL;@ JUDICIAL MEMBER JAIPUR DATED:- 25/08/202019. DAS/ VKNS'K DH IZFRFYFI VXZSF'KR@ COPY OF THE ORDER FORWARDED TO: 4 MA NO. 29/JP/2020 SHRI KISHAN LAL AGARWAL, ALWAR. 1. THE APPELLANT- THE ACIT, CIRCLE 2, ALWAR. 2. THE RESPONDENT SHRI KISHAN LAL AGARWAL, ALWAR. 3. THE CIT(A). 4. THE CIT, 5. THE DR, ITAT, JAIPUR 6. GUARD FILE (MA NO. 29/JP/2020) VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASSISTANT. REGISTRAR