The ITO, Ward-2(1)(1), Ahmedabad V. M/s. Gujarat Terce Laboratories Ltd., Ahmedabad

MA 5/AHD/2019

• Counselvise Citation: [2019] 116 COUNSELVISE.COM (IT) 6649 (ITAT-AHMEDABAD)
• Duration Of Justice: 6 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 29-07-2019
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2013-2014
• Appeal Filed On: 02-01-2019
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: A C SHAH
• Keywords: Tax effect
• Section: 143(3)

Judgement Text

, IN THE INCOME TAX APPELLATE TRIBUNAL, B BENCH, AHMEDABAD BEFORE SHRI RAJPAL YADAV , JUDICIAL MEMBER AND SHRI WASEEM AHMED , ACCOUNTANT MEMBER M.A NO.5 /AHD/2019 IN ./ ITA NO. 2301 / AHD/ 2016 / ASSTT. YEAR : 2013 - 2014 INCOME TAX OFFICER, WARD - 2(1)(1), AHMEDABAD. VS GUJARAT TERCE LABORATORIES LTD. 301, AKASHRATH COMPLEX, NEAR LAW GARDEN, NAVRANGPURA, AHMEDABAD . PAN AAACG5528L (APPLICANT) (RESPONENT) REVENUE BY : SHRI VINOD TANWANI, SR.D .R. ASSESSEE BY : SHRI A.C. SHAH, A.R / DATE OF HEARING : 19 / 07 /201 9 / DATE OF PRONOUNCEMENT: 29 / 07 /201 9 / O R D E R PER WASEEM AHMED, ACCOUNTANT MEMBER : BY THIS MISCELLANEOUS APP LICATION, THE REVENUE HAS REQUESTED FOR RECALLING OF THE ORDER DATED 30/07 /2018 PASSED BY THE CO - ORDINATE BENCH, IN ITA NO. 2301/AHD/2016 FOR ASST. YEAR 20 13 - 201 4 . 2. IN THE MISCELLANEOUS APPLICATION THE REVENUE HAS SUBMITTED AS FOLLOWS: IN THIS CASE, THE APPLICANT MOST RESPECTFULLY SUBMITS THAT THE APPLICANT HEREIN HAD FILED ITA NO. 2301/AHD/2016 OF THE INCOM E TAX ACT, 1961 BEFORE THE HONB LE ITAT, M.A NO.5 /AHD/2019 IN ITA NO.2301/AHD/2016 A.Y.20 13 - 1 4 . 2 AHMEDABAD, AGAINST OR DER DATED 30.07.2018 OF THE HON BLE ITAT, 'B', BENCH, AHMEDABAD IN THE ABOVE MENTIONED CASE. 1. IN THIS CASE, THE ASSESSEE HAS FILED ITS RETURN OF INCOME FOR A.Y. 2013 - 14 ON 09/10/2013 DECLARING TOTAL INCOME OF RS.17,86,218/ - . THE ASSESSMENT WAS COMPLETED U/S 143(3) OF THE ACT ON 23/03/2016 DETERMINING TOTAL INCOME OF RS.2,98,49,559/ - AFTER MAKING ADDITION OF RS.2,68,00,375/ - ON ACCOUNT OF BOGUS SALE PROMOTION EXPENSE AND DISALLOWANCE OF RS.12,62,966/ - ON ACCOUNT OF PROVISION FOR GRATUITY U/S. 40A(7) OF INCOME TAX ACT, 1961. 2. BEING AGGRIEVED WITH THE ORDER OF THE A.O., THE ASSESSEE PREFERRED APPEAL BEFORE CIT(A). THE CIT(A) VIDE ITS ORDER NO.CIT(A) - 2/430/ITO, WD.2(L)(L)/2015 - 16 DATED 0/06/2016 PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. THE CIT(A) HAD RESTRICTED DISALLOWANCE OF BOGUS SALES PROMOTION EXPENSE TO RS.28,61,9 37/ - AS AGAINST DISALLOWANCE OF RS.2,68,00,375/ - AND DISMISSED THE APPEAL OF THE ASSESSEE ON GROUND OF DISALLOWANCE OF RS.12,62,966/ - ON ACCOUNT OF PROVISION FOR 40A(7) OF INCOME TAX ACT, 1961. 3. THEREAFTER, THE DEPARTMENT PREFERRED APPEAL BEFORE THE HON'BL E ITAT. THE HON BLE ITAT, AHMEDABAD DISMISSED THE APPEAL OF THE REVENUE ON ACCOUNT OF LOW TAX EFFECT, IN VIEW OF CBDT'S INSTRUCTION BEARING NO.03/2018 DATED 11.07.2018. 4. PERUSAL OF THE ITAT ORDER DATED 30.07,2018 REVELS THAT HON'BLE ITAT HAS NOT GONE INTO THE MERITS OF THE MATTER. THE HON'BLE ITAT HAS NOT ADJUDICATED ANY ISSUE ON MERITS BUT RELYING ON BOARD'S INSTRUCTION NO 03/2018 DATED 11/07/2018, DISPOSED OFF THE APPEAL FILED BY THE REVENUE STATING 'NOT CONSIDERING THE SAID CIRCUL AR APPEAL IS NOT MAINTAINABLE IN VIEW OF THE TAX EFFECT INVOLVED IN THE CASE IS BELOW THE PRESCRIBED MONETARY LIMIT.' HOWEVER, ON VERIFICATION OF THE CASE RECORDS, IT IS SEEN THAT TAX EFFECT INVOLVED IS RS.77,57,093/ - AND THEREFORE THE APPEAL IS REQUIRED T O BE RESTORED BY WAY OF FILING MISCELLANEOUS APPLICATION. IT IS THEREFORE RESPECTFULLY SUBMITTED AND PRAYED THAT IN THE FACTS AND CIRCUMSTANCES STATES HEREINABOVE, THIS HONBLE COURT PLEASED TO: (A)TO RECALL THE ORDER DATED 30.07.20 18 PASSED BY THIS HON'BLE ITAT 'B' BENCH, AHMEDABAD IN ITA NO. 2301/AHD/2016 AND HEAR THE APPLICANT HEREIN ON MERITS. (B)TO PASS ANY OTHER OR FURTHER ORDERS, AS THIS HON'BLE TRIBUNAL MAY DEEM FIT AND PROPER IN THE FACTS AND CIRCUMSTANCES OF THE CASE. 3. AT THE OUTSET, THE LD.D R, FOR THE REVENUE BEFORE US SUBMITTED THAT THE IMPUGNED APPEAL HAS BEEN DISMISSED BY THE HON BLE ITAT BY HOLDING THAT TAX M.A NO.5 /AHD/2019 IN ITA NO.2301/AHD/2016 A.Y.20 13 - 1 4 . 3 EFFECT IS LESS THAN RS.20 LACS ONLY H OWEVER, IT WAS SUBSEQUENTLY FOUND THAT TAX EFFECT IN THE INSTANT CASE EXCEEDS RS.20 LACS. THEREFORE, IT IS PRAYED TO RECALL THE MATTER AND FIX FOR HEARING AS PER THE PROVISION OF LAW. 4. ON THE OTHER HAND LD.AR , FAIRLY CONCEDED THAT THE TAX EFFECT EXCEEDS RS.20 LACS. 5 . WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIALS AVAILABLE ON RECORDS. ADMITTEDLY, THE TAX EFFECT IN THE INSTANT CASE EXCEEDS RS.20 LACS, THEREFORE, WE HOLD THAT THE CIRCULAR ISSUED BY THE CBDT BEARING NO.3/2018 DATED 11/07/2018, DOES NOT APPLY IN THE PRESENT CASE. ACCORDINGLY, WE NOTE THAT THERE IS A MISTAKE IN THE ORDER OF THE ITAT WHICH IS APPARENT FROM THE RECORD ACCORDINGLY WE CALL THE MATTER OF THE ITAT DT.30/07/2018 AND DIRECT THE REGISTRY TO FIX THE FRESH HEARING ON 09 /10 /2019 . AS THE DATE OF HEARING WAS PRONOUNCED IN THE OPEN COURT, THEREFORE WE HOLD THAT THERE WILL NOT BE SERVED ANY NOTICE OF HEARING TO ANY OF THE PARTY SEPARATELY. 5. IN THE RESULT, THE MISCELLANEOUS APPLI CATION FILED BY THE REVENUE IS ALLOWED. ORDER PRONOUNCED IN THE COURT ON 29 / 07 / 201 9 AT AHMEDABAD. - SD - ( RAJPAL YADAV ) JUDICIAL MEMBER - SD - ( WASEEM AHMED ) ACCOUNTANT MEMBER (TRUE COPY) AHMEDABAD; DATED 29 / 07 / 201 9 MANISH