DCIT4(1), Indore V. Smt Kalawati Dubey , Indore

MA 4/Ind/2022

AI Insights

The case involves the Income Tax Department (Revenue) seeking to recall an ITAT order that dismissed their appeal against an assessment order due to the low tax effect, which was below the monetary limit prescribed by CBDT Circulars. The Revenue argued that their case fell under an exception to these circulars because the issue originated from a Revenue Audit Objection (RAO). However, the ITAT found that the original assessment order, which was revised under section 263, did not directly arise from the RAO, thus not qualifying for the exception. The ITAT dismissed the M/A, affirming the dismissal of the original appeal due to low tax effect.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 128094 (ITAT-INDORE)
• Duration Of Justice: 1 year(s) 3 month(s) 10 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 02-07-2023
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 11-05-2023
• Assessment Year: 2012-2013
• Appeal Filed On: 22-03-2022
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Revision of order; Tax effect; Tax effect
• Section: 263; 143(3); 254(2)

Judgement Text

आयकर अपीलȣय अͬधकरण, इंदौर Ûयायपीठ, इंदौर IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH, INDORE BEFORE SHRI VIJAY PAL RAO, JUDICIAL MEMBER AND SHRI B.M. BIYANI, ACCOUNTANT MEMBER M.A No. 04/Ind/2022 (Arising out of ITA No. 178/Ind/2020) Assessment Year: 2012-13 DCIT, 4(1), Indore बनाम/ Vs. Smt. Kalawati Dubey, 47, Mahesh Guard Line, Kamla Nehru Colony, Indore. (Applicant/Revenue) (Respondent/Assessee) PAN: AJQPD 2300 R Revenue by Shri Ashish Porwal, Sr. DR Assessee by Shri Anil Kamal Garg CA and Arpit Gaur, CA & Ld. Ars Date of Hearing 12.05.2023 Date of Pronouncement 03.07.2023 आदेश/ O R D E R Per B.M. Biyani, A.M.: This Misc. Application [“M/A”] u/s 254(2) of Income-tax Act, 1961 is preferred by Revenue seeking recall of the Order dated 08.07.2021 of ITAT, Indore Bench in ITA No. 178/Ind/2020 for assessment-year 2012-13 [Hereinafter “impugned Order”] by which the Revenue’s appeal was dismissed on account of low tax effect i.e. tax effect being less than Rs. 50 lac as prescribed in the CBDT Circular No.3/2018 dated 11.07.2018 read with Circular No. 17/2019 dated 08.08.2019. Smt. Kalawati Dubey, Indore. MANo.04/Ind/2022 Assessment year 2012-13 Page 2 of 5 2. Heard the learned Representatives of both sides at length and case record perused. 3. At the start of hearing, Ld. AR representing the assessee raised a preliminary objection that the present M/A has been filed on 23.03.2022 which is after 31.01.2022 i.e. after expiry of 6 months from end of the month in which the impugned Order dated 08.07.2021 was passed. But, when it emerged during discussions that the 6 months’ period though expired on 31.01.2022 but the revenue was having extension of time granted by virtue of order of Hon’ble Supreme Court in Suo Motu Writ Petition (C) No. 3 of 2020 read with Misc. Applications for filing of appeals/ applications w.e.f. 15.03.2020 due to Covid-19 pandemic, Ld. AR fairly agreed to withdraw objection. Thus, the objection raised by Ld. AR is rejected and the M/A is proceeded for hearing. 4. Before we proceed to adjudicate the merit of present M/A, certain material facts must be taken note of. In this case, the original assessment- order was passed by AO on 31.03.2015 u/s 143(3). This was subjected to revision u/s 263 by PCIT-2, Indore vide order dated 28.03.2017 whereby the original assessment-order was set aside and a fresh assessment was directed to be made. In pursuance thereof, the AO passed a fresh assessment-order dated 28.12.2017 u/s 143(3) read with section 263. The assessee carried this order of fresh assessment in first-appeal to CIT(A) and succeeded. The revenue filed next appeal to ITAT which was dismissed vide impugned Order on account of low tax effect. Now, the present M/A is filed by revenue to recall the impugned Order. 5. Ld. DR submitted that the present M/A is filed for the reason that the revenue’s appeal was dismissed by ITAT on account of low tax effect although the issue involved therein originated from “Revenue Audit Objection (RAO)” accepted by Income-tax Department. To prove this, Ld. DR has placed on record a copy of RAO running over 5 pages accompanied by letter F.No.Pr.CIT-2/Ind/Tech/MARA/2/2016-17/4848 dated 18.01.2017 of Smt. Kalawati Dubey, Indore. MANo.04/Ind/2022 Assessment year 2012-13 Page 3 of 5 the office of PCIT-2, Indore, which reveals that the revision u/s 263 was conducted accepting the RAO. Having shown this, Ld. DR submitted that the revenue’s appeal dismissed by impugned Order was falling within the exception prescribed in Para No. 10(c) of the CBDT Circular No. 3/2018. Therefore, according to Ld. DR, although the tax effect was less than the prescribed monetary limit of Rs. 50 lac yet the case was covered by exception 10(c); hence the Revenue’ Appeal was maintainable and could not have been dismissed. Ld. DR also carried our attention to the last sentence of Para No. 5 of the impugned Order passed by ITAT wherein the ITAT, while dismissing revenue’s appeal, clearly gave liberty to the revenue to file M/A if the case is covered under “exception clause”. Ld. DR submitted that in view of this, the revenue’s appeal must be restored and properly adjudicated on merits. 6. Per contra, Ld. AR for the assessee strongly opposed the submission of Ld. DR. Firstly, he contended that the impugned Order of ITAT arose from assessment-order dated 28.12.2017 and that assessment-order was not made on the basis of RAO; that assessment-order was made in pursuance of revision-order u/s 263. He contended that it might have happened that the revision-order u/s 263 itself was based on RAO but that aspect exhausted with the finality of revision-order itself and presently irrelevant. Thus, Ld. AR submitted, it’s a mis-understanding that the assessment-order which gave rise to appeal before ITAT in the impugned Order, was based on RAO. Secondly, Ld. AR also went on further submitting, if at all the revision was carried out on the basis of RAO, such fact was neither mentioned in the revision-order nor brought to the notice of assessee during entire proceeding. Ld. AR submitted that had such fact been communicated at any stage of revision-proceeding or revision-order, perhaps the assessee would have been successful in assailing the revision-order itself on that very ground i.e. the revision made on the basis of RAO was invalid. Thus, by not bringing such a vital fact to the knowledge of assessee, the revenue has deprived the assessee of its legitimate right of making a sound pleading in Smt. Kalawati Dubey, Indore. MANo.04/Ind/2022 Assessment year 2012-13 Page 4 of 5 appeal against revision-order itself. Ld. AR submitted that the present M/A cannot be allowed in such circumstances. 7. We have considered rival arguments of both sides and perused the material held on record. After our mindful consideration, we agree with the first pleading of Ld. AR itself that in the present case it might have happened that the revision u/s 263 was done on the basis of RAO. But the appeal dismissed by impugned Order of ITAT was not against revision-order; it was against the order of CIT(A) which in turn emanated from assessment- order passed by AO. Since the assessment-order was not made by AO on the basis of any kind of RAO, the benefit of exception clause is not available to revenue. Therefore, without going further, we are inclined to accept the very first pleading of Ld. AR and thereby hold that the present case cannot be considered in the realm of exception 10(c). Being so the present M/A fails on that very reasoning. We order accordingly. 8. Resultantly, this M/A is dismissed. Order was pronounced in the open court on 03.07.2023. Sd/- sd/- (VIJAY PAL YADAV) (B.M. BIYANI) JUDICIAL MEMBER ACCOUNTANT MEMBER Indore Ǒदनांक /Dated :03.07.2023 CPU/Sr. PS Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) Departmental Representative (6) Guard File By order Sr. Private Secretary Smt. Kalawati Dubey, Indore. MANo.04/Ind/2022 Assessment year 2012-13 Page 5 of 5 Income Tax Appellate Tribunal Indore Bench, Indore