ITO 27 (2)(4), MUMBAI V. NISHITA MUKESH BHIMANI, MUMBAI

MA 44/MUM/2020

• Counselvise Citation: [2021] 107 COUNSELVISE.COM (IT) 7892 (ITAT-MUMBAI)
• Duration Of Justice: 1 year(s) 7 month(s) 8 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 02-09-2021
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2014-2015
• Appeal Filed On: 24-01-2020
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Tax effect; Penny stocks
• Section: 268A; 254(2)

Judgement Text

MA NO 44/MUM/2020 IN ITA NO. 2103/MUM/2019 ASSESSMENT YEAR: 2014 - 15 PAGE 1 OF 3 IN THE INCOME TAX APPELLATE TRIBUNAL MUMBAI 'D' BENCH, MUMBAI [CORAM: JUSTICE P.P. BHATT (PRESIDENT), AND PRAMOD KUMAR (VICE PRESIDENT)] MA NO 44/MUM/2020 IN ITA NO. 2103/MUM/2019 ASSESSMENT YEAR: 2014 - 15 INCOME TAX OFFICER 27 (2)(4), MUMBAI. .APPLICANT VS. MS. NISHITA MUKESH BHIMANI RESPONDENT F - 554, GARDEN COURT SOCIETY, OPP. CHIRAG NAGAR POLICE STATION, LBS MARG, GHATKOPAR (W), MUMBAI 400086. [PAN: ADBPB2616F] APPEARANCES BY SUN IL DESPANDE FOR THE APPLICANT NONE FOR THE RESPONDENT DATE OF CONCLUDING THE HEARING: : JULY 13, 2021 DATE OF PRONOUNCEMENT OF ORDER : S E P T E M B E R 0 2 , 2021 ORDER PER BENCH: 1. BY WAY OF THIS MISCELLANEOUS APPLICATION, THE ASSESSING OFFICER SEEKS THE RECALL OF OUR ORDER DATED 21.08.2019 SUMMARILY DISMISSING THE APPEAL ON ACCOUNT OF LOW TAX EFFECT BEING LESS THAN 50 LAKHS, ON THE FOLLOWING GROUNDS: - APPLICANT REQUESTS YOUR HONOURS KIND PERMISSION TO SUBMIT THE FOLLOWING FACTS FOR BENIGN CONSIDERATION. 1. THIS MISCELLANEOUS APPLICATION ARISES OUT OF ORDER DATED 21.08.2019 PASSED BY THE D BENCH IN ITA NO. 2049/MUM/2019 BETWEEN ITO - 27(2) - 4 AND MS. NISHITA MUKESH BHIMANI. THE HONBLE D BENCH HAS DISMISSED THE REVENUE APPEAL IN THIS CASE. BRIEF FACTS O F THE CASE MA NO 44/MUM/2020 IN ITA NO. 2103/MUM/2019 ASSESSMENT YEAR: 2014 - 15 PAGE 2 OF 3 THIS IS WITH REFERENCE TO THE APPELLATE ORDER IN ITA NO. 2103/MUM/2019 DATED 21.08.2019, PASSED BY THE HONBLE ITAT, MUMBAI D BENCH IN THE CASE OF MS. NISHITA MUKESH BHIMANI, PAN - ADBPB2616F FOR A.Y. 2014 - 15. HONBLE ITAT VIDE ITS ORDER DATED 21.08.2019 HAS DISMISSED THE REVENUE APPEAL DUE TO LOW TAX EFFECT WITHOUT GOING INTO THE FACTS OF THE CASE. HOWEVER, CBDT HAS ISSUED CIRCULAR NO. 23 ON 06.09.2019 STATING WHERE ORGANIZED TAX - EVASION SCAM IS NOTICED THROUGH BOGUS LONG - TERM CAPITAL GAIN (LTCG/SHORT TERM CAPITAL LOSS (STCL) ON PENNY STOCKS THEN NOTWITHSTANDING ANYTHING CONTAINED IN ANY CIRCULAR ISSUED U/S. 268A SPECIFYING MONETARY LIMITS FOR FILING OF DEPARTMENTAL APPEALS BEFORE INCOME TAX APPELLATE TRIBUNAL (ITAT), HIGH COURTS AND SLPS/APPEAL BEFORE SUPREME COURT, APPEALS MAY BE FILED ON MERITS AS AN EXCEPTION TO SAID CIRCULAR, WHERE BOARD, BY WAY OF SPECIAL ORDER DIRECT FILING OF APPEAL ON MERIT IN CASES INVOLVED IN ORGANISED TAX EVASION ACTIVITY. FACTS IN THIS CASE ARE FAILING UNDER THE EXCEPTION CLAUSE OF CIRCULAR NO. 23/2019 AND ALSO FALLS UNDER EXCEPTION CLAUSE (E) TO PARA 10 OF CIRCULAR NO. 3/20187 AS AMENDED BY 20.08.2018. CONSIDERING ABOVE, A MISCELLANEOUS APPLICATION TO ITAT FOR WITHDRAWAL OF ITS ORDER IN THE ASSESSEES CASE U/S. 254(2) OF IT ACT FOR RECONSIDERATION ON MERITS ON FOLLOWING GROUNDS IS FILED: - 1.ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE AND IN LAW, WHETHER THE HONBLE ITAT WAS CORRECT IN DISMISSING THE APPEAL OF THE REVENUE ON THE GROUND OF LOW TAX EFFECT ALTHOUGH THIS CASE FALLS UNDER CLAUSE (E) OF PARA 10 OF THE AMENDMENT TO CIRCULAR NO. 3/2018 DATED 20.08.2018. 2. THE APPELLANT PRAYS THAT THE HONBLE BENCH MAY KIN DLY ADJUDICATE THE ABOVE CONTENTION AND MAY BE PLEASED TO MODIFY THEIR DECISION DATED 21.08.2019 IN ITA NO. 2103/MUM/2019 AND PASS SUCH ORDER AS MAY BE DEEMD TO BE APPROPRIATE IN THIS CASE. 3. THE APPELLANT CRAVES LEAVE TO AMEND OR ALTER ANY GROUNDS OR A DD A NEW GROUND WHICH MAY BE NECESSARY. 2. WE HAVE HEARD THE RIVAL CONTENTIONS, PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF THE APPLICABLE LEGAL POSITION. 3. WE FIND THAT THERE TWO REASONS ON ACCOUNT OF WHICH T HE ORDER IS SOUGHT TO BE RECALLED THE FIRST REASON IS STATED TO BE THAT IN VIEW OF THE CBDT CIRCULAR NO. 23 ON 06.09.2019 WHERE ORGANIZED TAX - EVASION SCAM IS NOTICED BY WAY OF PENNY STOCKS CAPITAL GAIN, THE SAME IS TO BE COVERED AS AN EXCEPTION TO THE LOW TAX EFFECT CIRCULAR. WHAT THIS PLEA, HOWEVER, OVER LOOKS IS THAT THIS CIRCULAR WERE ISSUED ON 06.09.2019 , WHEREAS THE IMPUGNED ORDER WAS PASSED ON 21.08.2019. THEREFORE AS ON THE DATE OF PASSING THE IMPUGNED ORDER THERE WAS NO SUCH CIRCULAR ENFORCE CONSEQU ENTLY IT CANNOT BE SAID THAT THERE WAS AN ERROR NOT FOLLOWING THE CBDT CIRCULAR NO. 23. THE SECOND PLEA IS THAT THE ASSESSMENT IS BASED ON EXCEPTION SET OUT IN CLAUSE (E) OF PARA 10 OF THE CBDT CIRCULAR PROVIDING EXCEPTION OF THE CASES WHERE ASSESSMENT IS BASED ON THE INPUTS OF THE EXTERNAL AGENCIES SUCH AS CBI/ED/DRI/SFIO/DIRECTORATE GENERAL OF GST INTELLIGENCE (DGGI). WHAT THIS PLEA OVER LOOK S IS THE FACT THE IMPUGNED MA NO 44/MUM/2020 IN ITA NO. 2103/MUM/2019 ASSESSMENT YEAR: 2014 - 15 PAGE 3 OF 3 ASSESSMENT WAS FRAMED ON THE BASIS OF INPUTS FROM THE INVESTIGATION WING WHICH IS NOT AN EXTERNAL AGENCY. THIS PLEA THEREFORE DOES NOT NEED OUR APPROVAL EITHER . IN VIEW OF THE ABOVE DISCUSSION, AS ALSO BEARING IN MIND ENTIRETY OF THE CASE, WE REJECT THE APPLICATION OF THE APPLICANT . WE ORDER, ACCORDINGLY. 4. IN THE RESULT, THIS MISCELLANEOUS APPLICATION IS DISMISSED. PRONOUNCED IN THE OPEN COURT TODAY ON THE 0 2 N D DAY OF S E P T E M B E R , 202 1. S D / - S D / - JUSTICE P.P. BHATT PRAMOD KUMAR (PRESIDENT) (VICE PRESIDENT) MUMBAI, DATED THE 0 2 N D S E P T E M B E R , 2021 COPIES TO: (1) THE APPELLANT (2) THE RESPONDENT (3) CIT (4) CIT(A) (5) DR (6) GUARD FILE BY ORDER TRUE COPY ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL MUMBAI BENCHES, MUMBAI