CIT vs. NAKUL KAPUR

ITA/873/2011HC DelhiDLHC01040428201114 September 2011Bench: CASES PERTAINING TO SPL.DIVISION BENCHES2 pages

AI SummaryDismissed

What did the High Court hold?

The Tribunal dismissed the appeals filed by the Revenue on the grounds of low tax effect. The Tribunal referred to Para 5 of the CBDT's Circular dated 9th February, 2011, which stipulates that appeals should only be filed when the tax effect in one of the years exceeds ₹10 lacs. The Tribunal noted that while composite orders involving multiple assessment years might allow for appeals even if individual years have low tax effect, this exception did not apply here as the individual tax effects were below the prescribed monetary limit. The Tribunal also observed that the issues raised in the appeals were purely factual in nature, further supporting the dismissal on procedural grounds rather than merits.

What were the facts?

The Income Tax Appellate Tribunal (ITAT) was considering three appeals filed by the Revenue against common orders passed by the ITAT. The tax effect in these appeals were ₹2,68,006, ₹7,84,646, and ₹7,76,300. The assessee was represented by Ms. Shashi M. Kapila and others, while the Revenue was represented by Mr. Abhishek Maratha. The appeals were decided by a common order. The ITAT noted that the tax effect in each individual appeal was less than ₹10 lacs.

What were the issues?

1. Whether the appeals filed by the Revenue are maintainable given the tax effect in each individual appeal is less than ₹10 lacs, as per CBDT Circular dated 9th February, 2011? (Question of law) Assessee's Contention: The assessee did not explicitly argue on this point, but the Tribunal's decision implies that the assessee would have benefited from the circular if the Revenue's appeals were dismissed on this ground. Revenue's Contention: The Revenue did not explicitly argue against the applicability of the circular. The Tribunal's observation that the issues raised are purely factual in nature might suggest an implicit argument that the factual nature of the issues should not preclude an appeal, but this is not explicitly stated.

AI-generated summary — verify with the full judgment below

#L2 to 14 olo.L4.O9.2011 Present: Mr. Abhishek Maratha, Sr. Standing Counsel for the Revenue. Ms. Shashi M. Kapila with Mr. Pravesh Sharma and Mr. Sushil Kumar, Advs. for the assessee. (Common Orders) +ITA Nos.858, 872, 873l2O11 * Cost paid. - Though three appeals were decided by a common order passed by the Income Tax Appellate Tribunal ('the Tribunal' for brevity), tax effect in all these three appeals are <2,68,006/-, <7,84,646/- and <7,76,300/-. Thus, individual tax effect in all these cases is less than t10 lacs. As per Para 5 of CBDT's Circular dated 9th February, 2071, appeal could be filed in all the cases only when tax effect in one of the years was more than t10 lacs. This is clear from \; the following extract from the said para: "5......However, in case of a composite order of any High Court or appellate authority, which involves more than one assessment year and common issues in more than one assessment year, appeal shall be filed in respect of all such assessment year, appeal shall be filed in respect of all such assessment years even if the 'tax effect' is less than the prescribed monetary limits in any of the year(s), if it is decided to file appeal in respect of the year(s) in which 'tax effect' exceeds the monetary limit prescribed ............." Digitally Signed By:AMULYA Certify that the digital file and physical file have been compared and the digital data is as per the physical file and no page is missing. Signature Not Verified

/ Appeals are accordingly dismissed on account of low tax effect. We may also point out that the issues raised are purely factual in nature. her€( 1] -aJffirffii, J. tlll ' t t* SIDDHARTH MRIDUL, J. SEPTEMBER 14, 2OL'- pmc t €t"

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