Addl.CIT, R-6, Mohali V. Smt. Sushma Bansal, Mohali

MA 8/CHANDI/2022

• Counselvise Citation: [2022] 104 COUNSELVISE.COM (IT) 3418 (ITAT-CHANDIGARH)
• Duration Of Justice: 2 month(s) 6 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-07-2022
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 25-07-2022
• Assessment Year: 2012-2013
• Appeal Filed On: 19-05-2022
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Rectification of order; Audit objection; Tax effect
• Section: 148; 143(3); 2(22)(e); 254(2)

Judgement Text

आयकर अपील य अ धकरण,च डीगढ़ यायपीठ “बी” , च डीगढ़ IN THE INCOME TAX APPELLATE TRIBUNAL, CHANDIGARH BENCH “B”, CHANDIGARH ी एन.के .सैनी, उपा य! एवं ी स ु धांश ु ीवा&तव, या(यक सद&य BEFORE: SHRI. N.K.SAINI, VP & SHRI. SUDHANSHU SRIVASTAVA, JM Miscellaneous Application No. 8/Chd/2022 ( ITA No. 59/Chd/2020) Assessment Year : 2012-13 The Add. CIT R-6, Mohali Smt. Sushma Bansal House No. 1708, Phase-3B2 Mohali- Punjab PAN NO: AGWPB7593B Appellant Respondent ! " Assessee by : Written Submission # ! " Revenue by : Shri Akashdeep, JCIT, Sr. DR $ % ! & Date of Hearing : 26/07/2022 '()* ! & Date of Pronouncement : 26/07/2022 आदेश/Order PER N.K. SAINI, VICE PRESIDENT This Miscellaneous Application by the Department is arising out of the order dt. 23/11/2021 in ITA No. 59/Chd/2020. 2. The Department contended in this Misc. Application as under: Sub:- Miscellaneous Application under Sub-Section (2) of Section 254 of the Income Tax Act 1961 - In the instant case, an Appeal was filed by the Revenue against the order of the Ld. CIT(A), Shimla in Appeal No. 2/10477/17-18 dated 04.10.2019 for A.Y. 2012-13. The Ld. CIT(A) vide its order in appeal No. 2/10477/17-18 dated 04.10.2019, had restricted the addition to Rs.3,07,230/- maintaining that it had been evidenced by the assessee through ledger accounts that the advance received during the year was Rs.3,07,230/-. The following grounds of appeal were taken by the Revenue before the Hon'ble ITAT:- 1. Whether in facts and circumstances of the case and in law, the Ld. CIT(A) has not erred in partly allowing the appeal of the assessee without appreciating the facts of the case? 2. Whether in the facts and circumstances of the case and in law, the Ld. CIT(A) has not erred in law and facts in holding that the assessee has received Advances of Rs.3,07,230/- only during the year and thereby restricting the addition to Rs.3,07,230/- made by invoking provisions of section 2(22)(e) of the Income Tax Act, 1961 while ignoring the fact that the whole of the amount of Rs.31,98,948/- was received during the current year? 2 3. It is prayed that the order of the Ld. CIT(A) be set-aside and that of the Assessing Officer may be restored. 4. The appellant craves to add or amend any grounds of appeal before the appeal is heard or is disposed off. 2. The Hon'ble ITAT, vide order in ITA No. 59/Chd/2020 dated 23.11.2021 has summarily dismissed the appeal of the department in view of the monetary limit for filing appeal before ITAT which is Rs.50,00,000/- vide Circular No 17/2019 dated 08.08.2019. The said decision of the Hon'ble lTAT is not acceptable, as the Hon'ble ITAT has dismissed the appeal of the revenue only in view of low tax effect without going into the merits of the case. In the instant case, Revenue Audit Party had raised the objection in the case of M/s Saraswati Agro Chemicals India (P) Ltd. that " the assessee company advanced an amount of Rs.31,98,948/- to Ms. Sushma Bansal (PAN: AGWPB7593B), holding 15.46% of the shareholding. The said amount to be treated as income of Ms. Sushma Bansal in terms of provisions of Section 8 read with section 2(22)(e), any payment by a company, not being a company in which the public are substantially interest, of any sum by way of advance or loan to a shareholder, being a person who is beneficial owner of shares holding not less than 10% of voting power, shall be included in the total income of the beneficial person, subject to the limit of accumulated profits possessed by the said company. 3. On the basis of the said audit objection, remedial action u/s 148 of the income tax act was taken in the case of the assessee after getting approval u/s 151 of the income tax Act from the Pr. CIT-2, Chandigarh F.No.Pr.CIT-2/CHD/Stat-25/2016-17/6813 dated 25.01.2017. However, during the course of proceedings before the Hon'ble ITAT, Chandigarh, this fact was not brought to the notice of the Hon'ble Bench. Therefore, the Departmental appeal was dismissed on the ground that the case was below the monetary threshold limit as prescribed in Circular No. 17 of 2019. It is pertinent to mention here that the case falls in the exception clause mentioned in para 10(c) in the amended circular of CBDT dated 20.08.2018. 4. Keeping in view the above facts, the Hon'ble Tribunal is, therefore requested to admit the present Misc. application and thus revive the appeal as filed in ITA No. 59/Chd/2020 dated 23.11.2021 for the A.Y. 2012-13 and give decision on the ground of appeal on merits. 5. The application is being filed as per the approval of the Pr. Commissioner of Income tax-1, Chandigarh. Sd/- (Ravinder Kumar) Income Tax Officer Ward-6(1), Mohali 3. During the course of hearing nobody was present on behalf of the assesse, however the written submission has been furnished which is placed on record. 4. The Ld. Sr. DR reiterated the contents of the aforesaid Misc. Application and stated that the order dt. 23/11/2021 in ITA No. 59/Chd/2020 may be recalled. 5. The Ld. Counsel for the Assessee in his written submission stated as under: 3 The Revenue has filed application for rectification of mistake u/s 254(2) of the Income Tax Act that the order passed by Honourable Bench in ITA No 59/Chd/2020 dated 23.11.21 is not acceptable, as the Honourable ITAT has dismissed the appeal of the revenue only in view of low tax effect without going into the merits of case. The department has taken a very fresh plea that addition u/s 2(22)(e) of I.Tax Act, 1961 was made in the instant case based on the observation passed by Revenue Audit party. Hence it falls in exception of circular on CBDT for monetary limits for filling this appeal. The Revenue also admits in its application u/s254(2) in item 3 (fourth line] that "However, during the course of proceedings before the Honourable ITAT, Chandigarh, this fact was not brought to the notice of Honourable Bench," Your Honour, your attention is drawn on two things: 1) i) In the order passed by Ld. A. 0 u/s 143(3) r.w. S 147 of the Income, Tax Act 1961 dated 30.11.2017, neither the reasons of reopening u/s 148 reproduced at page 2 suggest that case has been reopened based on audit objection nor any part or para this order has such contents. i) the grounds of appeal before the Honourable ITAT also do not suggest that addition has been made by accepting Audit objection by revenue. 2 ) Revenue itself admits that such facts are not placed before the Honourable ITAT Your Honour, in para 4 of your order it has been clearly stated by your Honour's that'' We have considered the submissions of both the parties and carefully gone through the material available on record." Therefore, in absence of such material on record that addition has been made based on Revenue Audit objection, it is purely in air. Neither it is in assessment order; nor it is in grounds of appeal, nor it has been raised during hearing. Therefore, under such facts and circumstances, although it is the prerogative of Honourable Court to admit or not to admit application u/s 254(2) of the Income Tax Act,1961 yet there is also no mistake which can be held to be prima facie available on records to hold that order for ITA/59/CHD/2020 dated 23.11.2021 is erroneous and contains a mistake. Further Revenue stated that order is not acceptable then Revenue has every right to challenge it before Honourable High Court. Accordingly, our role is only to place and bring on records the facts about this order passed by Honourable ITAT in respect of ITA No. 59/CHD/2020 dated 23.11.2021. Submitted Sir Sd/- (CA Akshun Gupta) Counsel Jammu: 18-07-2022 6. We have considered the submissions of both the parties and perused the material available on the record. In the present case the appeal of the Department 4 was dismissed due to low tax effect. Now the Department moved an application that the remedial action under section 148 of the Income Tax Act, 1961 (hereinafter referred to as ‘Act’) was taken in the case of the assessee on the basis of audit objection, at the same time it was admitted in the miscellaneous application itself that during the course of proceeding before the ITAT this fact was not brought to the notice of the Bench. Therefore, by considering the submissions of both the parties we are of the view that there is no mistake apparent from the record in the order dated 23/11/2021 of the ITAT, which may be rectified under section 254(2) of the Act. In that view of the matter, we, do not see any merit in this Misc. Application filed by the Department. 7. In the result, Misc. Application filed by the Department is dismissed. (Order pronounced in the open Court on 26/07/2022 ). Sd/- Sd/- स ु धांश ु ीवा&तव एन.के .सैनी, (SUDHANSHU SRIVASTAVA) ( N.K. SAINI) या(यक सद&य/ JUDICIAL MEMBER उपा य! / VICE PRESIDENT AG Date: 26/07/2022 ( + ! , - . - Copy of the order forwarded to : 1. The Appellant 2. The Respondent 3. $ / CIT 4. $ / 0 1 The CIT(A) 5. - 2 ग 4 5 & 4 5 678 ग9 DR, ITAT, CHANDIGARH 6. ग 8 : % Guard File