ACIT, Central circle-8, New Delhi V. Krishan Kumar , New Delhi

MA 823/DEL/2019

AI Insights

The case involves the Assistant Commissioner of Income Tax (ACIT), Central Circle-8, New Delhi as the appellant and Krishan Kumar as the respondent. The Revenue's appeal was initially dismissed by the Tribunal due to the low tax effect, which was below the monetary limits prescribed by CBDT Circular No.17/2019. However, the Revenue filed a Miscellaneous Application citing an exception under CBDT Circular No.3/2018, which allows for appeals to be contested on merits if prosecution has been filed and is pending in court. The Tribunal found that the prosecution against the assessee under sections 276CC and 276D for failure to file a return and willfully failing to produce documents, justified restoring the appeal for adjudication on merits.

• Counselvise Citation: [2023] 140 COUNSELVISE.COM (IT) 130772 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 5 month(s) 12 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 25-04-2023
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 20-04-2023
• Assessment Year: 2013-2014
• Appeal Filed On: 13-11-2019
• Laws Referred To: Income Tax Act
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Keywords: Tax effect; Tax effect

Judgement Text

Page 1 of 5 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH ‘D’: NEW DELHI BEFORE, DR. B.R.R.KUMAR, ACCOUNTANT MEMBER AND SHRI YOGESH KUMAR U.S., JUDICIAL MEMBER MA No.823/Del/2019 (Arising out of ITA No.6387/Del/2018) ASSESSMENT YEAR 2013-14 ACIT Central Circle-8 New Delhi Vs. Krishan Kumar C-20, Duggal Colony Devli Road, Khanpur New Delhi-110 062 PAN-AAEPK 8794P (Appellant) (Respondent) Appellant by Mr. Neeraj Mangla, CA Respondent by Mr. Om Prakash, Sr. DR Date of Hearing 21/04/2023 Date of Pronouncement 26/04/2023 ORDER PER YOGESH KUMAR U.S., JM: This present Miscellaneous Application (‘MA’, for short) filed by the Revenue. It is the case of the Revenue that the Tribunal vide its order dated 28.08.2019 in ITA No.6387/Del/2018, dismissed the appeal filed by the Revenue on account of low tax effect, though the tax effect in this appeal is below the monetary limits prescribed in para 3 of CBDT Circular No.17/2019 dated 08.08.2019, but the M.A No.823/Del/2019 ACIT vs. Krishan Kumar Page 2 of 5 case falls under exception as explained in clause (f) of para 10 of CBDT Circular No.3/2018 dated 20/08/2018 which states as under: “10. Adverse judgments relating to the following issues should be contested on merits notwithstanding that the tax effect entailed is less than the monetary limits specified in para 3 above or there is no tax effect: (f) Cases where persecution has been filed by the Department and is pending in the Court.” 2. The Ld. DR vehemently submitted that in the present case, prosecution has been launched by filing complaint u/s 276CC & 276D of the Act for the A.Y.2013-14 and is pending before Hon’ble ACMM Tis Hazari Court, Delhi, therefore, the case of the assessee falls within the exception of the Circular No.3/2008 dated 11 th July, 2018 and the appeal filed by the Revenue required to be adjudicated on merits irrespective of the fact that the tax effect in this appeal is less than the monetary limits specified, therefore, prayed for restoration of the appeal. 3. The Ld. Counsel for the assessee vehemently submitted that the prosecution has been initiated u/s 276CC & 276D of the Act which are failure to file return of income and willfully fail to produce the document referred in the notice served on the M.A No.823/Del/2019 ACIT vs. Krishan Kumar Page 3 of 5 Assessee, therefore, the exceptions mentioned in the Circular No.3/2018 is not applicable and the Tribunal has rightly dismissed the appeal filed by the Revenue in ITA No.6387/2018. 4. We have heard the rival submissions and perused the material on record. It is not in dispute that prosecution has been initiated by the Department u/s 276CC and 276D of the Act against the assessee but not for any concealment of income. We have verified amendment to Para-10 of Circular No.3/2018 dated 11/07/2018 which are reproduced as under: “10. Adverse judgments relating to the following issues should be contested on merits notwithstanding that the tax effect entailed is less than the monetary limits specified in para-3 above or there is no tax effect: (a) Where the Constitutional validity of the provisions of an Act or Rules is under challenge, or (b) Where Board’s order, Notification, Instruction or Circular has been held to be illegal or ultra vires, or (c) Where Revenue Audit objection in the case has been accepted by the Department, or (d) Where addition relates to undisclosed foreign income/undisclosed foreign assets (including financial assets)/undisclosed foreign bank account. M.A No.823/Del/2019 ACIT vs. Krishan Kumar Page 4 of 5 (e) Where addition is based on information received from external sources in the nature of law enforcement agencies such as CBI/ED/DR/SFIO/Directorate General of GST Intelligence (DGGI). (f) Cases where prosecution has been filed by the Department and is pending in the Court.” 5. As per para 10 of the above Circular, the adverse judgment relating to the issues should be contested on merit notwithstanding that the tax effect entailed is less than the monetary limits specified. By plain reading of the above Circular, the CBDT has not differentiated between the prosecution initiated for concealment of income or otherwise. As per the said Circular wherever the prosecution has been filed by the Department and the same is pending the said Circular will not applicable and Appeal should be contested on merit. Thus, the contention of the assessee is that since the prosecution has been initiated against the assessee u/s 276CC and 276D of the Act, the exceptions mentioned in the Circular No.3/2018 is not applicable is devoid of merit. Therefore, in our opinion, the M.A filed by the Revenue deserve to be allowed and accordingly, we allow the Miscellaneous Application of the Revenue by restoring the Appeal in ITA No.6387/Del/2018. The M.A No.823/Del/2019 ACIT vs. Krishan Kumar Page 5 of 5 case is posted to 20/06/2023 and registry is directed to inform the parties. Order pronounced in the open Court on 26th April, 2023 Sd/- Sd/- sSd// (DR. B.R.R.KUMAR) (YOGESH KUMAR U.S.) ACCOUNTANT MEMBER JUDICIAL MEMBER Dated: 26/04/2023 Pk/R.N, Sr. PS Copy forwarded to: 1. Appellant 2. Respondent 3. CIT 4. CIT(Appeals) 5. DR: ITAT ASSISTANT REGISTRAR ITAT, NEW DELHI