THE ITO, WARD-2(6), JAMNAGAR V. SHRI MOHANLAL K. JAIN, JAMNAGAR

MA 5/RJT/2021

AI Insights

The case revolves around a Miscellaneous Application by the Revenue seeking to reinstate an appeal against Shri Mohanlal K. Jain, which was previously dismissed by the Tribunal due to the low tax effect. The Revenue argued that the case fell under exceptions to the monetary limit prescribed by CBDT Circulars, citing new information from the Central Excise Department. However, the Tribunal found that the information did not come from the specified law enforcement agencies listed in the exception clause of the circulars, leading to the dismissal of the MA.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 707055 (ITAT-RAJKOT)
• Duration Of Justice: 4 year(s) 1 month(s) 12 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 07-07-2025
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Assessment Year: 2006-2007
• Appeal Filed On: 25-05-2021
• Other Referred Cases: DCIT Vs. Bhojraj Lal Chand Nawani
• Laws Referred To: Income-tax Act, 1961
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ABHIMANYU SINGH YADAV; LD.
• Assessee Lawyers: SAGAR SHAH; LD
• Keywords: Tax effect

Judgement Text

"आयकर अपीलीय अिधकरण, राजकोट Æयायपीठ, राजकोट। IN THE INCOME TAX APPELLATE TRIBUNAL, RAJKOT BENCH, RAJKOT BEFORE DR. ARJUN LAL SAINI, ACCOUNTANT MEMBER AND SHRI DINESH MOHAN SINHA, JUDICIAL MEMBER MISC. APPLICATION NO.05/RJT/2021 Arising out of आयकर अपील सं/.ITA No.344/RJT/2015 िनधाªरणवषª / Assessment Year: 2006-07 Income Tax Officer Ward-2(6) Jamnagar. बनाम Vs. Shri Mohanlal K. Jain Prop: of Reena Metal Syndicate & Illesh Exports,C-2/32, GIDC, STU Jamnagar. PAN : ABRPJ 8641 G (अपीलाथê/Appellant) : (ÿÂयथê/Respondent) Ǔनधा[ǐरती कȧ ओर से/Assessee by : Shri Sagar Shah, ld.AR राजèव कȧ ओर से/Revenue by : Shri Abhimanyu Singh Yadav, ld.Sr.DR सुनवाई कȧ तारȣख /Date of Hearing : 06/06/2025 घोषणा कȧ तारȣख /Date of Pronouncement : 07/07/2025 ORDER Per Dr. Arjun Lal Saini, Accountant Member: By way of this Miscellaneous Application (MA), the Revenue has sought to point out that a mistake apparent from record within the meaning of section 254(2) of the Income-tax Act, 1961 (in short, ‘the Act’) has crept in the order of Tribunal dated 03.12.2020, in assessee’s case in ITA No.344/RJT/2015. 2. The ld.DR for the Revenue, at outset, pointed out that case of the Revenue in this miscellaneous application, is that the Tribunal has dismissed the appeal of the Revenue, by applying the CBDT Circular No.17 of 2019, on account of tax effect. However, there are Exceptions in the Circular No.5 of 2024 (latest circular of CBDT), wherein the information received from the excise department, is ITO Vs. Shri Mohanlal K. Jain MA No.05 /RJT/201 2 covered in Exceptional clause, of the said CBDT circular. The learned DR further pointed out that in this Miscellaneous Application, u/s 254(2) of the Income Tax Act, 1961, the Revenue has requested for reinstating the appeal, bearing ITA No. 344/RJT/2015 which was dismissed by the Tribunal on the ground that the tax effect was below the monetary limit prescribed as per CBDT Circular no. 17 of 2019, dated 08.08.2019. However, the instant appeal falls within the exception to monetary limit carved out in para 10(e) of Circular No. 3/2018, as amended on 20.08.2018 which states that 'where addition is based on information received from external sources in the nature of law enforcement agencies such as CBI/ED/DRI/SFIO/DGGI', such issues are to be contested on merits. Since in the instant appeal the addition was made on the basis of the information received from Preventive Wing of Central Excise, Rajkot who had carried out Search operations, hence, it clearly falls within the exceptions provided in para 10(e) above. Therefore, the MA filed by the Revenue is maintainable and therefore, the order of Tribunal dated 03.12.2020 may be recalled and the issue involved in the assessee`s appeal may be decided on merit. 3.On the other hand, the ld.Counsel for the assessee submitted that in the Circular No.17 of 2014, Central Excise authority was not stated in the Exception clause. However, it is covered by the CBDT, in Circular No.5 of 2024, vide clause 3(i) and clause (e) of the said circular ( latest circular). However, Circular No.5 of 2024 is applicable prospectively and not retrospectively. Therefore, the Tribunal has rightly dismissed the appeal of the Revenue, on account of low tax effect. For that the ld.Counsel for the assessee relied on the judgment of Hon’ble High Court of Chhattisgarh, Bilaspur, MCC No.621 of 2019 in the case of DCIT Vs. Bhojraj Lal Chand Nawani order dated 16.9.2019. 4. We have heard both the parties, and perused material available on record. We note that in Circular No.17 of 2019 only CBI/ED/DRI/SFIO/DGGI are ITO Vs. Shri Mohanlal K. Jain MA No.05 /RJT/201 3 defined in the Exception clause. We have gone through para 10(e) of the old circular of CBDT and noticed that same would apply where addition is based on information received from external sources in the nature of law enforcement agencies such as CBI/ED/DRI/SFIO/ Directorate General of GST Intelligence (DGGI). In the assessee`s case, under consideration, the information was received from the central excise department, which is a different department, which is not defined in the said circular. Therefore, Central excise Department, information, having not emanated from the CBI/ED/DRI/SFIO/DGGI, hence para 10 (e) of the circular would have no application. Besides, the Circular No.5 of 2024 is applicable prospectively and not retrospectively. Therefore, we note that in the case of the assessee, under consideration, the information was received from the Central Excise Department, which is not covered in the Exception Clause of the CBDT circular, therefore, based on this factual position, there is no apparent mistake in the order of the Tribunal, and therefore, we dismiss the miscellaneous application (MA) filed by the Revenue. 5. In the result, the miscellaneous application (MA) of the Revenue is dismissed. Order is pronounced in the open court on 07/07/2025 Sd/- Sd/- (DINESH MOHAN SINHA) JUDICIAL MEMBER (DR. ARJUN LAL SAINI) ACCOUNTANT MEMBER राजकोट /Rajkot िदनांक/ Date: 07/07/2025 Vk* आदेश कì ÿितिलिप अúेिषत/ Copy of the order forwarded to :  अपीलाथê/ The Appellant  ÿÂयथê/ The Respondent ITO Vs. Shri Mohanlal K. Jain MA No.05 /RJT/201 4  आयकर आयुĉ/ CIT  आयकर आयुĉ(अपील)/ The CIT(A)  िवभागीय ÿितिनिध, आयकर अपीलीय आिधकरण, राजकोट/ DR, ITAT, RAJKOT  गाडªफाईल/ Guard File /True copy/ By order Assistant Registrar/Sr. PS/PS ITAT, Rajkot "