ITO, Ward-4(2)(3), Ahmedabad V. Gopika Vaishnav L/h Late Shri Nilesh Chandrakant Vaishnav, Ahmedabad

MA 366/AHD/2019

• Counselvise Citation: [2020] 111 COUNSELVISE.COM (IT) 8476 (ITAT-AHMEDABAD)
• Duration Of Justice: 1 month(s) 18 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 20-01-2020
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2012-2013
• Appeal Filed On: 02-12-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: L P JAIN
• Assessee Lawyers: DHWANI MEHTA
• Keywords: Audit objection; Tax effect

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL SMC BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV, JUDICIAL MEMBER AND SHRI WASEEM AHMED, ACCOUNTANT MEMBER MA NO.366/AHD/2019 AY 2012-13 (IN ./ IN ITA NO. 276/AHD/2019) [ / ASSESSMENT YEAR : 2012-13] THE ITO WARD-4(2)(3) AHMEDABAD / VS. GOPIKA VAISHNAV L/H LATE SHRI NILESH CHANDRAKANT VAISHNAV 36, NUTAN SOCIETY B/H. SUVIDHA SHOPPING CENTRE PALDI, AHMEDABAD 380 007 ./ ./PAN/GIR NO. : AALPV 1953 C ( /APPLICANT ) .. ( / RESPONDENT ) / APPLICANT BY : SHRI L.P. JAIN, SR.DR / RESPONDENT BY: MS.DHWANI MEHTA, AR / DATE OF HEARING 17/01/2020 / DATE OF PRONOUNCEMENT 20/01/2020 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER: BY THIS MISCELLANEOUS APPLICATION, THE REVENUE HAS REQUESTED FOR RECALLING OF THE COMMON ORDER DATED 26/07/2019 PASS ED BY THE ITAT AHMEDABAD BENCH D IN ITA NO.276/AHD/2019 FOR AY 2 012-13, DISMISSING APPEAL OF THE DEPARTMENT DUE TO LOW TAX EFFECT. 2. LD. AR MS.DHWANI MEHTA, APPEARED FOR THE ASSE SSEE. LD.DR L.P.JAIN, SR.DR APPEARED FOR THE DEPARTMENT. IT IS PLEADED IN THE APPLICATION THAT THE REVENUE AUDIT OBJECTION WAS AC CEPTED BY THE MA NO.366/AHD/2019 (IN ITA NO.276/AHD/2019) GOPIKA VAISHNAV VS. ITO ASST.YEAR 2012 -13 - 2 - DEPARTMENT AND THEREAFTER ASSESSMENT ORDER U/S.143( 3) R.W.S.147 OF THE I.T.ACT, 1961 WAS MADE. FURTHER, THE LD.CIT(A) VID E NO.CIT(A)- 4/10412/2017-18 DATED 28/12/2018 HAS DELETED THE AD DITION OF RS.22,12,500/- U/S.56(2)(VII)(C)(II) OF THE INCOME TAX ACT, 1961. 3. DISSATISFIED WITH THE ORDER OF THE CIT(A), THE REVENUE CAME UP IN APPEAL BEFORE THE TRIBUNAL. THE TRIBUNAL DISMISSED THE APPEAL OF THE REVENUE VIDE ORDER DATED 26/07/2019. THE TRIBUNA L WAS OF THE VIEW THAT TAX EFFECT INVOLVED IN THIS CASE IS LESS THAN RS.20 LAKHS BECAUSE THE TAX RELIEF GRANTED BY THE CIT(A) IS LESS THAN RS.20 LAKHS AND, THEREFORE, IN VIEW OF THE BOARD INSTRUCTION BEARING NO. 3 OF 2 018 DATED 11/07/2018 SUCH APPEAL IS NOT MAINTAINABLE BEFORE THE TRIBUNAL . 4. IT HAS BEEN FURTHER PLEADED THAT INSTRUCTION NO. 3/2018 CONTAINS EXCEPTIONAL CLAUSE AT SL.NO.8 OF THE INSTRUCTION. ACCORDING TO SUB-CLAUSE (C) OF CLAUSE 8 IF A REVENUE AUDIT OBJECTION HAS BE EN ACCEPTED BY THE DEPARTMENT, THEN THE APPEALS OF SUCH ISSUES WOULD B E CONTESTED ON MERIT AND WILL NOT BE WITHDRAWN BY VIRTUE OF THESE INSTRU CTIONS. SINCE IT WAS A CASE, REOPENED ON AUDIT OBJECTION, THEREFORE IT FAL LS WITHIN THE EXCEPTIONAL CLAUSE PROVIDED IN THE INSTRUCTION. 5. HOWEVER, DURING THE COURSE OF HEARING, WE HAVE C ONFRONTED THE LD. DR WITH THE CBDT INSTRUCTION BEARING NO.5/2017 DATE D 23/01/2017. THESE INSTRUCTIONS PROVIDE THAT EVEN IF AN ASSESSME NT IS BEING REOPENED ON ACCOUNT OF AUDIT OBJECTION BUT THE ADDITIONS ARE DELETED BY THE CIT(A) MA NO.366/AHD/2019 (IN ITA NO.276/AHD/2019) GOPIKA VAISHNAV VS. ITO ASST.YEAR 2012 -13 - 3 - ON MERIT, THEN FOR THE PURPOSE OF CHALLENGING THE O RDER OF CIT(A) IN FURTHER APPEAL THE CASE WOULD BE REQUIRED TO BE EXA MINED ON MERIT. SIMPLY THE APPEAL WOULD NOT BE FILED BECAUSE THE CA SE FALLS WITHIN THE EXCEPTIONAL CLAUSE OF THE CBDT INSTRUCTION FOR NOT FILING THE APPEAL WHERE THE TAX EFFECT BY VIRTUE OF RELIEF GRANTED BY THE CIT(A) IS LESS THAN THE MONETARY LIMIT FOR FILING SUCH APPEALS. IN OTH ER WORDS, THE DEPARTMENT HAS TO ASSESS THE MERITS OF THE DISPUTE INVOLVED AND THEY WILL NOT FILE FURTHER APPEAL AGAINST THE ORDER OF THE CI T(A) OR ITAT IN A MECHANICAL MANNER. THE RELEVANT PARA-3 OF CIRCU LAR NO.17 READS AS UNDER:- 3. HOWEVER, IT HAS BEEN NOTICED THAT PARA 8(C) OF CI RCULAR NO.21/2015, REGARDING CASES WHERE ADDITION MADE ON ACCOUNT OF REVENUE AUD IT OBJECTION IS DELETED, IS BEING ERRONEOUSLY INTERPRETED AND APPEALS ARE BEING MECHANICALLY FILED BY THE DEPARTMENT WITHOUT PROPER EXAMINATION OF THE CASE O N MERITS. THIS IS CONTRARY TO THE INSTRUCTIONS CONTAINED IN CIRCULAR NO.21/2015 AND C IRCULAR NO.8/2016. IT IS THEREFORE, CLARIFIED THAT THE IMPORT AND INTENT OF PARA 8 OF THE CIRCULAR NO.21/2015 IS THAT EVEN ON ISSUES MENTIONED IN THE SAID PARA, APP EALS AGAINST THE ADVERSE JUDGMENT SHOULD ONLY BE FILED ON MERITS. 5.1. WE HAVE ALSO CONFRONTED WITH THE LD.DR WITH TH E JUDGMENT OF HONBLE BOMBAY HIGH COURT IN THE CASE OF PR.CIT VS. NAWANY CONSTRUCTION CO. (P.) LTD. REPORTED IN 98 TAXMANN.C OM 294 (BOMBAY). 5.2. THE HONBLE BOMBAY HIGH COURT HAS CONSIDERED T HIS CIRCULAR AND OBSERVED THAT MERE RAISING OF THIS AUDIT OBJECTION IS NOT SUFFICIENT FOR RECALL OF THE ORDER. THE RELEVANT PART OF THE DISC USSION OF THE HONBLE BOMBAY HIGH COURT HAS HELD AS UNDER: 8. IT IS CONCEDED THAT WHILE SEEKING TO RESTORE I NCOME TAX APPEAL NO.254 OF 2013 ON THE FILE OF THIS COURT, NEITHER T HE REVENUES CIRCULAR MA NO.366/AHD/2019 (IN ITA NO.276/AHD/2019) GOPIKA VAISHNAV VS. ITO ASST.YEAR 2012 -13 - 4 - DATED 11-7-2018 IS REFERRED NOR ANY CONDITION THERE IN. IF THE CONDITION NOW RELIED UPON IS WITH REGARD TO THE REVENUE AUDIT OBJECTION, THEN, MERE RAISING OF THIS OBJECTION IN TERMS OF THIS CIR CULAR IS NOT ENOUGH. THE REVENUE WILL HAVE TO POINT OUT THAT THIS AUDIT OBJECTION HAS BEEN ACCEPTED BY THE DEPARTMENT. WE HAVE NO SUCH RECORD BEFORE US. 9. IN THE CIRCUMSTANCES, WE FIND THAT THIS IS AN A TTEMPT TO GET OVER THE BINDING CIRCULARS AND IN ANY CASE WE SHALL NOT ALLO W THE REVENUE TO GET OVER THEM IN THIS MANNER. THE CIRCULARS CONTINUE T O BIND THE REVENUE AND IF THEY CONTAIN ANY CONDITIONS, WHETHER SUCH CO NDITIONS ARE ATTRACTED OR NOT WOULD HAVE TO BE PROVED AND ESTABL ISHED BY THE REVENUE. ONCE THERE IS NO SUCH RECORD BEFORE US, W E DO NOT COUNTENANCE THE ORAL REQUEST OF MR. PINTO. CONSEQU ENTLY, WE DO NOT SEE ANY REASON TO ENTERTAIN THIS APPEAL. IT IS DISMISS ED. 6 . THE LD.DR WAS UNABLE TO CONTROVERT THE ABOVE POSI TION. 7. ON DUE CONSIDERATION OF ALL THESE FACTS AND CIRC ULAR OF THE BOARD, I.E. CIRCULAR NO.5 OF 2017 IN THE LIGHT OF HONBLE BOMBAY HIGH COURT DECISION, WE ARE OF THE VIEW THAT DEPARTMENT HAS N OT BROUGHT ANY SUBSTANTIAL MATERIAL ON THE RECORD POINTING OUT THA T APPEAL WAS FILED AFTER EVALUATION OF MERIT ON THE ISSUES INVOLVED. IT SOU GHT TO RECALL THE ORDER OF THE TRIBUNAL MERELY ON THE BASIS OF AUDIT OBJECTION , WHICH IS NOT SUFFICIENT FOR RECALLING THE TRIBUNAL ORDER. THERE FORE, WE DO NOT FIND ANY ERROR IN THE ORDER OF THE TRIBUNAL. THUS THE MISCEL LANEOUS APPLICATION IS REJECTED. MA NO.366/AHD/2019 (IN ITA NO.276/AHD/2019) GOPIKA VAISHNAV VS. ITO ASST.YEAR 2012 -13 - 5 - 7. IN THE RESULT, MISCELLANEOUS APPLICATION FILED B Y THE REVENUE IS DISMISSED. THIS ORDER PRONOUNCED IN OPEN COURT ON 20/01/2020 SD/- SD/- ( RAJPAL YADAV ) ( WASEEM AHMED ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 20/01/2020 # . . , . $ . . / T.C. NAIR, SR. PS !' #' / COPY OF THE ORDER FORWARDED TO : 1. / THE APPLICANT 2. / THE RESPONDENT. 3. %&' ( / CONCERNED CIT 4. ( ( ) / THE CIT(A)-4, AHMEDABAD 5. )*+ $$&' , &' , % / DR, ITAT, AHMEDABAD 6. +./ / GUARD FILE. / BY ORDER, ) $ //TRUE COPY// / (DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION 17.1.2020 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 17.1.2020 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S.20.1.2020 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK ..20.1.2010 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER