THE DCIT, CIRCLE-1(1)(1), AHMEDABAD vs. M/S. ARYA OMNITALK WIRELESS SOLUTIONS PVT. LTD., AHMEDABAD

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ITA 3240/AHD/2015Status: DisposedITAT Ahmedabad26 February 2019AY 2011-123 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the Revenue's appeal was not maintainable due to the CBDT circular and the tax effect not exceeding the prescribed limit. It was also noted that penalty proceedings would not survive if the additions were deleted in quantum appeal.

What were the facts?

The Revenue appealed against the deletion of additions made on account of unutilized CENVAT credit and disallowance of provision for gratuity and leave encashment for book profit computation. The assessee argued that the appeal was hit by a CBDT circular regarding monetary limits for appeals.

What were the issues?

Whether the Revenue's appeal is maintainable based on CBDT circulars and monetary limits. Whether penalty proceedings survive if additions are deleted in quantum appeal.

Which sections of the Income-tax Act were involved?

Section 145A,Section 115JB

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “C” BENCH, AHMEDABAD

Before: SHRI PRADIP KUMAR KEDIA & SHRI MAHAVIR PRASAD

For Appellant: Shri Lalit P. Jain, Sr.D.R

आदेश/O R D E R

PER PRADIP KUMAR KEDIA - AM:

The captioned appeal has been filed at the instance of the Revenue against the order of the Commissioner of Income Tax (Appeals)-3, Ahmedabad (‘CIT(A)’ in short), dated 07th September, 2015 arising in the assessment order dated 27.03.2014 passed by the

ITA No. 3240/Ahd/15 [DCIT vs. M/s. Arya Omnitalk Wireless Solutions Pvt. Ltd.] A.Y. 2011-12 - 2 -

Assessing Officer (AO) under s. 143(3) of the Income Tax Act, 1961 (the Act) concerning AY 2011-12.

2.

The grounds of appeal raised by the Revenue read as under:-

“1. The CIT(A) has erred in law and on facts in deleting the addition made of Rs.31,10,943/- on account of unutilized CENVAT credit u/s 145A of the Act.

2.

The CIT(A) has erred in law and on facts in deleting the addition made of disallowance of provision for gratuity and leave encashment for computing Book profit u/s 115JB of the Act.”

3.

At the time of hearing, it was submitted by the Ld.AR for the assessee that appeal filed by the Revenue is hit by recently issued CBDT Circular No.3 of 2018 dated 11/07/2018 revising the previous thresholds pertaining to tax effects. As per aforesaid Circular, all pending appeals filed by Revenue are liable to be dismissed as a measure for reducing litigation where the tax effect does not exceed the prescribed monetary limit which is now revised at Rs.20 Lakhs. In the instant case, the tax effect on the disputed issues raised by the Revenue is stated to be not exceeding Rs.20 lakhs and therefore appeal of the Revenue is required to be dismissed in limine. The AR further pointed out that notwithstanding the aforesaid circular, the quantum appeal has also been decided in favour of the assessee by the ITAT and this penalty appeal of the Revenue does not survive. The AR referred to the decision of the co-ordinate bench in ITA No. 1883/Ahd/2014 dated 02.08.2017 in quantum proceedings for this purpose.

4.

The Learned DR for the Revenue fairly admitted the applicability of the CBDT Circular No. 3 of 2018. Accordingly, appeal of the Revenue is dismissed as not maintainable. Secondly,

ITA No. 3240/Ahd/15 [DCIT vs. M/s. Arya Omnitalk Wireless Solutions Pvt. Ltd.] A.Y. 2011-12 - 3 -

penalty proceedings do not survive in view of the decision of additions/disallowances in quantum.

5.

In the result, the appeal of the Revenue is dismissed.

This Order pronounced in Open Court on 26/02/2019

Sd/- Sd/- (MAHAVIR PRASAD) (PRADIP KUMAR KEDIA) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad: Dated 26/02/2019 True Copy S. K. SINHA आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. राज�व / Revenue 2. आवेदक / Assessee 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त- अपील / CIT (A) 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाइल / Guard file. By order/आदेश से,

उप/सहायक पंजीकार आयकर अपील�य अ�धकरण, अहमदाबाद ।

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