DEPUTY COMMISSIONER OF INCOME TAX CENTRAL CIRCLE 2(3), MUMBAI V. ACME HOUSING INDIA PRIVATE LIMITED , MUMBAI

MA 879/MUM/2017

• Counselvise Citation: [2018] 124 COUNSELVISE.COM (IT) 6955 (ITAT-MUMBAI)
• Duration Of Justice: 7 month(s) 19 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 26-07-2018
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Assessment Year: 2011-2012
• Appeal Filed On: 07-12-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VIRENDER SINGH
• Keywords: Tax effect

Judgement Text

P A G E | 1 M.A. NO. 879/MUM/2017 A.Y. 2011 - 12 (ARISING OUT OF ITA NO. 5024/MUM/2015) DY. COMMISSIONER OF INCOME TAX - CC - 2(3) VS. M/S ACME HOUSING INDIA PRIVATE LTD IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, M UMBAI BEFORE SHRI G.S.PANNU, AM AND SHRI RAVISH SOOD, JM M.A. NO. 879 /MUM/2017 (ARISING OUT OF ITA NO. 5024/MUM/2015 ) ( / ASSESSMENT YEAR:2011 - 12 ) DY. COMMISSIONER OF INCOME TAX - CC - 2(3) ROOM NO. 803, 8 TH FLOOR, PRATISTHA BHAWAN, OLD CGO, ANNEXE BUILDING, M.K. ROAD, MARINE LINES, MUMBAI - 400020 / VS. M/S ACME HOUSING INDIA PRIVATE LTD, GR. FLOOR, ACME GHAR, 19 K.D. ROAD, VILE PARLE (W), MUMBAI - 400021 ./ ./ PAN NO. AADCA0705E ( / REVENUE ) : ( / ASSESSEE ) / REVENUE BY : SHRI VIRENDER SINGH, D.R / ASSESSEE BY : SHRI JITENDRA JAIN, A .R / DATE OF HEARING : 04.05 .2018 / DATE OF PRONOUNCEMENT : 2 6 .07.2018 / O R D E R PER RAVISH SOOD, JUDICIAL MEMBER: ORDER U/S 254(2) THE PRESENT MISCELLANEOUS APPLICATION FILED BY THE REVENUE UNDER SEC.254(2) OF THE INCOME TAX ACT, 1961 (FOR SHORT ACT) ARISES FROM THE ORDER PASSED BY THE TRIBUNAL UNDER SEC.254(1) OF THE ACT IN ITA NO. 5024/MUM/201 5, DATED 07.07.2017. P A G E | 2 M.A. NO. 879/MUM/2017 A.Y. 2011 - 12 (ARISING OUT OF ITA NO. 5024/MUM/2015) DY. COMMISSIONER OF INCOME TAX - CC - 2(3) VS. M/S ACME HOUSING INDIA PRIVATE LTD 2. THE LD. DEPARTMENTAL REPRESENTATIVE (FOR SHORT D.R) AT THE VERY OUTSET OF THE HEARING OF THE APPLICATION SUBMITTED THAT THE APPEAL OF THE REVENUE WAS DISMISSED BY THE TRIBUNAL ON THE GROUND THAT THE TAX EFFECT INVOLVED IN THE APPEAL WAS LESS THAN T HE MONETA RY LIMIT OF RS.10 LAC AS SPECIFIED IN THE CBDT CIRCULAR NO. 21/2015, DATED 10.12.2015. IT WAS AVERRED BY THE LD. D.R THAT THOUGH THE CBDT CIRCULAR NO. 21/2015, DATED 10.12.2015 PROVIDED THAT THE SAME WOULD ALSO BE APPLICABLE RETROSPECTIVELY TO THE P ENDING APPEALS, HOWEVER, THE SAME IS NOT FOUND TO BE IN CONFORMITY WITH THE JUDGMENT OF THE HONBLE SUPREME COURT IN THE CA SE OF CIT, BANGALORE - 1 VS. M/S G EMINI DISTILLERIE S [CIVIL APPEAL NO. 16815/2017 ( SLP (C) NO. 1425/2014, DATED 12.10.2017)]. IT WAS SU BMITTED BY THE LD. D.R THAT THE HONBLE APEX COURT IN THE CASE OF M/S G EMINI DISTILLERIES (SUPRA) HAD HELD THAT THE CBDT CANNOT ISSUE ANY CIRCULAR HAVING RETROSPECTIVE OPERATION. IN THE BACKDROP OF THE AFORESAID CONTENTION , IT WAS THE CLAIM OF THE LD. D.R THAT AS IN THE PRESENT CASE THE APPEAL WAS FILED BY THE REVENUE ON 09.10.2015, THEREFORE, THE MONETA RY CEILING CONTEMPLATED IN THE CBDT CIRCULAR NO. 21/2015, DATED 10.12.2015, IN THE ABSENCE OF ITS RETROSPECTIVE APPLICATION WOULD NOT COVER THE PRESENT APPE AL. ON THE BASIS OF THE AFORESAID FACTS IT WAS SUBMITTED BY THE LD. D.R THAT THE ORDER PASSED BY THE TRIBUNAL DISMISSING THE APPEAL OF THE REVENUE MAY BE RECALLED AND DISPOSED OFF ON MERITS. PER CONTRA, THE LD. AUTHORIZED REPRESENTATIVE (FOR SHORT A.R) S UBMITTED THAT NO INFIRMITY DID EMERGE FROM THE ORDER OF THE TRIBUNAL DISMISSING THE APPEAL OF THE REVENUE ON ACCOUNT OF LOW TAX EFFECT. IT WAS SUBMITTED BY THE LD. A.R THAT THE HONBLE SUPREME COURT IN ITS SUBS EQUENT JUDGMENT IN THE CASE OF D IRECTOR OF INC OME TAX VS. S.R.M.B. DAIRY FORMING PVT . LTD. (2018) 400 ITR 9 (SC) HAS HELD THAT BENEFICIAL CIRCULARS ARE TO BE APPLIED RETROSPECTIVEL Y , WHILE OPPRESSIVE CIRCULARS HAVE TO BE GIVEN A PROSPECTIVE EFFECT. IT WAS SUBMITTED BY THE LD. A.R THAT THE APPLICATION FILED BY THE REVENUE BEING DEVOID OF ANY FORCE WAS THUS LIABLE TO BE DISMISSED. 3. WE HAVE HEARD THE AUTHORIZED REPRESENTATIVES FOR BOTH THE PA RTIES. WE FIND THAT THE HONBLE SUPREME COURT IN THE CASE OF CIT, BANGALORE - 1 & ANR. VS. G EMINI DISTILLERIES [CIVIL APPEAL NO. 16815/2017 (SLP (C) NO. P A G E | 3 M.A. NO. 879/MUM/2017 A.Y. 2011 - 12 (ARISING OUT OF ITA NO. 5024/MUM/2015) DY. COMMISSIONER OF INCOME TAX - CC - 2(3) VS. M/S ACME HOUSING INDIA PRIVATE LTD 1425/2014, DATED 12.10.2017)] HAD IN CONTEXT OF THE RETROSPECTIVE APPLICABILITY OF THE CBDT INSTRUCTION/CIRCULAR, DATED 09.02.2011, HAD OPINED THAT THE CBDT CANNOT ISSUE ANY CIRCULAR HAVING RETROSPECTIVE OPERATION. HOWEVER, WE FIND THAT THE HONBLE SUPREME COURT IN ITS SUBSEQUENT JUDGMENTS IN THE CASE OF DIRECTOR O F INCOME TAX VS. S.R.M . B DAIRY FA RMING PVT. LTD. (2018) 400 ITR 9 (SC) , BY RELYING ON AN EARLIER THREE JUDGE BENCH ORDER OF THE COURT IN THE CASE OF CIT C ENTRAL - III VS. SURYA HERBAL LTD. [SLP (C) NO. CC. 13694/2011, DATED 29.08.2011] HAD OBSERVED THAT THE RETROSPECTIVE APPLICABILITY OF THE CIRCULAR DATED 09.02.2011 WAS NOT TO BE INTERFERED WITH, BUT WITH TWO CAVEATS VIZ. (I) C IRCULAR SH OULD NOT BE APPLIED BY THE HIGH COURTS IPSO FACTO WHEN THE MATTER HAD A CASCADING EFF ECT; (II) WHERE COMMON PRINCIPLES MAY BE INVOLVED IN SUBSEQUENT GROUP OF MATTERS OR A LARGE NUMBER OF MATTERS. WE FIND THAT THE HONBLE APEX COURT IN ITS ORDER PASSED IN THE CASE OF S.R.M.B D AIRY FARMING PVT. LTD. (SUPRA), HAD OBSERVED THAT AS THE MATTER AS REGARDS THE RETROSPECTIVE APPLICABILITY OF THE CIRCULARS HAD BEEN CLEARLY PUT TO REST BY THE THREE JUDGES BENCH OF THE COURT IN THE CASE OF SURYA HERBAL LTD. (SUPRA) , THUS THE SAME WOULD HO LD THE GROUND AND THE CIRCULAR S WOULD AP PLY EVEN TO THE PENDING MATTERS . 4. WE HAVE GIVEN A THOUGHTFUL CONSIDERATION TO THE MISCELLANEOUS APPLICATION FILED BY THE RE VENUE AND IN THE BACKDROP OF OUR AFORESAID OBSERVATIONS , ARE UNABLE TO PERSUADE OURSELVES TO SUBSCRIBE TO THE CLAIM OF THE REVENUE THAT THE TRIB UNAL HAD ERRED IN DISMISSING ITS APPEAL ON THE GROUND OF LOW TAX EFFECT. WE ARE OF THE CONSIDERED VIEW THAT AS HELD BY THE HONBLE APEX COURT IN THE CASE OF DIRECTOR OF INCOME TAX VS. S.R.M.B DAIRY FA RMING PVT. LTD. (2018) 400 ITR 9 (SC), THE MATTER AS REGARDS THE RETROSPECTIVE APPLICABILITY OF THE CIRCULARS ISSUED BY CBDT HAD BEEN PUT TO REST BY THE THREE JUDGES BENCH DECISION OF THE HONBLE SUPREME COURT IN THE CASE OF CIT C ENTRAL - III VS. SURYA HERBAL LTD [SLP (C) NO. CC 13694/2011, DATED 29.08.2011]. WE FIND THAT AS OBSERVED BY US HEREINABOVE , THE HONBLE APEX COURT IN THE CASE OF SURYA HERBAL LTD (SUPRA) HAD CONCLUDED THAT THE RETROSPECTIVE APPLICABILITY OF THE CBDT C IRCULAR DATED 09.02.2011 WAS NOT TO BE INTERFERED WITH, BUT WITH TWO CAVEATS, VIZ. (I) CIRCULAR SHOULD NOT BE P A G E | 4 M.A. NO. 879/MUM/2017 A.Y. 2011 - 12 (ARISING OUT OF ITA NO. 5024/MUM/2015) DY. COMMISSIONER OF INCOME TAX - CC - 2(3) VS. M/S ACME HOUSING INDIA PRIVATE LTD APPLIED BY THE HIGH COURT IPSO FACTO WHEN THE MATTER HAD A CASCADING EFFECT; AND (II) WHERE COMMON PRINCIPLES MAY BE INVOLVED IN SUBSEQUENT GROUP OF MATTERS OR A LARGE NUMBER OF MATTERS. WE ARE OF THE CONSIDERED VIEW THAT IN THE BACKDROP OF THE AFORESAID SETTLED POSITION OF LAW, NO MISTAKE DOES EMERGE FROM THE ORDER PASSED BY THE TRIBUNAL DISMISSING THE APPEAL FILED BY THE REVENUE ON ACCOUNT OF LOW TAX EFFECT AS CONTEMPLATED IN THE CBDT CIRCULAR NO. 21/2015, DATED 10.12.2015. WE THUS, IN TERMS OF OUR AFORESAID OBSERVATIONS DISMISS THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE. 5. THE MISCELLANEOUS APPLICATION FILED BY THE REVENUE IS DISMISSED. ORDER PRONOUNCED ON 2 6 .07.2018 S D / - S D / - (G.S. PANNU) (RAVISH SOOD) A CCOUNTANT MEMBER JUDICIAL MEMBER MUMBAI; 26 .07.2018 PS. R OHIT / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ( ) / THE CIT(A) - 4. / CIT 5. , , / DR, ITAT, MUMBAI 6. / GUARD FILE . //TRUE COPY// / BY ORDER, / (DY./ASSTT. REGISTRAR) , / ITAT, MUMBAI P A G E | 5 M.A. NO. 879/MUM/2017 A.Y. 2011 - 12 (ARISING OUT OF ITA NO. 5024/MUM/2015) DY. COMMISSIONER OF INCOME TAX - CC - 2(3) VS. M/S ACME HOUSING INDIA PRIVATE LTD