DCIT, CHENNAI V. Prabha Dixit, CHENNAI

MA 61/CHNY/2016

• Counselvise Citation: [2016] 124 COUNSELVISE.COM (IT) 4723 (ITAT-CHENNAI)
• Duration Of Justice: 4 month(s) 27 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 09-09-2016
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 09-09-2016
• Assessment Year: 2006-2007
• Appeal Filed On: 12-04-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SHIVA SRINIVAS
• Assessee Lawyers: R VISWANATHAN
• Keywords: Audit objection; Tax effect
• Section: 54

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, CHENNAI . . . , . , ! ' BEFORE SHRI N.R.S. GANESAN, JUDICIAL MEMBER AND SHRI A. MOHAN ALANKAMONY, ACCOUNTANT MEMBER M.P.NO.61/MDS/2016 [IN I.T.A.NO.2207/MDS/2015] ASSESSMENT YEAR : 2006-07 (PETITIONER) ( /RESPONDENT) PETITIONER BY : SHRI SHIVA SRINIVAS, JCIT RESPONDENT BY : SHRI R.VISWANATHAN, C.A. # $%! /DATE OF HEARING : 09.09.2016 &' $%! /DATE OF PRONOUNCEMENT : 09.09.2016 /O R D E R PER N.R.S. GANESAN, JUDICIAL MEMBER: THE REVENUE FILED THE PRESENT MISCELLANEOUS PETITIO N TO RECALL THE ORDER OF THIS TRIBUNAL DATED 28.12.2015. THE DEPUTY COMMISSIONER OF INCOME TAX, NON-CORPORATE CIRCLE -2, CHENNAI 600 034. V. MS.PRABHA DIXIT, NO.4, KRISHNASWAMY AVENUE, LUZ, MYLAPORE, CHENNAI 4. PAN. AAFPD 3966 K 2 M.A. NO.61/MDS/2016 2. SHRI SHIVA SRINIVAS, THE LEARNED DEPARTMENT REPR ESENTATIVE SUBMITTED THAT THIS TRIBUNAL DISMISSED THE APPEAL O F THE REVENUE ON THE GROUND THAT THE TAX EFFECT INVOLVED IN THIS APPEAL IS LESS THAN RS.10,00,000/-. REFERRING TO THE CIRCULAR ISSUED BY THE CBDT IN F.NO.279/MISC.142/2007 ITJ (PT) DATED 10.12.2015, THE LEARNED DEPARTMENT REPRESENTATIVE SUBMITTED THAT WHEREVER T HERE IS AN AUDIT OBJECTION WHICH WAS ACCEPTED BY THE DEPARTMENT, THE TAX EFFECT PRESCRIBED BY THE CBDT IS NOT APPLICABLE AND THE AP PEAL HAS TO BE CONTESTED ON MERIT. IN THIS CASE, SINCE, THERE IS A N AUDIT OBJECTION ACCORDING TO THE LEARNED REPRESENTATIVE, DISMISSAL OF THE APPEAL ON THE GROUND OF LESS TAX EFFECT MAY NOT BE CORRECT. THERE FORE, THE ORDER MAY BE RECALLED AND THE APPEAL MAY BE TAKEN UP FOR HEAR ING ON MERIT. 3. WE HEARD SHRI R.VISWANATHAN, THE LEARNED REPRESE NTATIVE FOR THE ASSESSEE ALSO. THE REVENUE NOW CLAIMS THAT THERE IS AN AUDIT OBJECTION. IN FACT, A COPY OF THE AUDIT OBJECTION WAS PRODUCED BEFORE THIS TRIBUNAL IN THE COURSE OF HEARING OF THE MISCELLANEOUS PETIT ION. HOWEVER, IT IS NOT KNOWN WHETHER THE AUDIT OBJECTION WAS ACCEPTED BY T HE INCOME TAX DEPARTMENT OR NOT. MERELY BECAUSE THERE WAS AN AUDI T OBJECTION THAT ALONE CANNOT BE A REASON TO EXCLUDE THE APPEAL FROM THE PURVIEW OF THE CIRCULAR ISSUED BY CBDT IN CIRCULAR F.NO.279/MISC.1 42/2007 ITJ (PT). SUCH CIRCULAR CLEARLY SAYS THAT WHEN THE AUDIT OBJE CTION WAS ACCEPTED BY THE DEPARTMENT, THEN, IT MAY NOT BE COVERED BY T HE CIRCULAR ISSUED BY 3 M.A. NO.61/MDS/2016 THE CBDT. IN THE CASE BEFORE US, NO MATERIAL IS PRO DUCED BEFORE US TO INDICATE THAT THE AUDIT OBJECTION IS ACCEPTED BY TH E INCOME TAX DEPARTMENT. FURTHERMORE, THE ISSUE ON MERIT IS INVE STMENT OF THE CAPITAL GAIN FOR THE PURPOSE OF CLAIMING EXEMPTION UNDER SE CTION 54 EC OF THE ACT. THE ASSESSEE INVESTED THE FUNDS IN HER NAME AL ONG WITH HER MOTHERS NAME. THE REVENUE DISALLOWED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT THE CAPITAL GAIN HAS TO BE DEPOSITE D IN HER NAME ALONE. THE CIT(A) BY PLACING HIS RELIANCE ON THE JUDGMENT OF THE KARNATAKA HIGH COURT IN THE CASE OF THE DIRECTOR OF INCOME TA X (INTERNATIONAL TAXATION) VS. MRS. JENNIFER BHIDE REPORTED IN (2012 ) 349 ITR 80 AND ALSO THE DECISION OF THE DELHI BENCH OF THIS TRIBUN AL IN THE CASE OF INCOME TAX OFFICER VS. SMT.SARASWATHI RAMANATHAN RE PORTED IN (2012) 300 ITR (AT) 410 ALLOWED THE CLAIM OF THE ASSESSEE. THEREFORE, WHEN THERE IS A JUDGMENT OF THE HIGH COURT IN FAVOUR OF THE ASSESSEE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE CIRC ULAR ISSUED BY THE CBDT CIRCULAR DATED 10.12.2015 EXCLUDING THE APPEAL S WITH REGARD TO AUDIT OBJECTION CANNOT OVER RULE THE JUDGMENT OF TH E KARNATAKA HIGH COURT. IN OTHER WORDS, EVEN THOUGH THERE IS AN AUDI T OBJECTION, IN VIEW OF THE JUDGMENT OF THE KARNATAKA HIGH COURT IN MRS. JE NNIFER BHIDE, THIS TRIBUNAL IS OF THE CONSIDERED OPINION THAT THE ASSE SSEE IS ELIGIBLE FOR THE EXEMPTION UNDER SECTION 54 EC OF THE ACT. THEREFORE , THIS TRIBUNAL DO NOT FIND ANY MERIT IN THE MISCELLANEOUS PETITION FI LED BY THE REVENUE. ACCORDINGLY, THE SAME IS DISMISSED. 4 M.A. NO.61/MDS/2016 4. IN THE RESULT, THE MISCELLANEOUS PETITION FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON 09 TH SEPTEMBER, 2016 AT CHENNAI. SD/- SD/- ( . ) ( . . . ) (A. MOHAN ALANKAMONY) (N.R.S. GANESAN) ! /ACCOUNTANT MEMBER /JUDICIAL MEMBER /CHENNAI, ( /DATED, THE 09 TH SEPTEMBER, 2016. SP. $ )%*+ ,+'% /COPY TO: 1. APPLICANT 2. )-./ /RESPONDENT 3. # 0% ( )/CIT(A) 4. # 0% /CIT 5. +1 )% /DR 6. 23 4 /GF.