INCOME -TAX OFFICER, PUNE vs. M/S. SHAMBHU PROPERTIES, PUNE

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ITA 1261/PUN/2017Status: DisposedITAT Pune27 June 2019AY 2013-145 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 dismissed the Revenue's appeals without expressing an opinion on the merits. This was based on a CBDT circular stating that departmental appeals should not be filed if the tax effect is below a certain threshold, which was the case here.

What were the facts?

The Revenue filed appeals against the CIT(A)'s order granting partial relief to the assessee, a firm engaged in property development. The appeals for two assessment years involved identical facts and issues, differing only in amounts.

What were the issues?

The primary issue was the maintainability of the Revenue's appeal due to low tax effect, as per CBDT circulars, overriding the merits of the deduction claimed under Section 80IB(10).

Which sections of the Income-tax Act were involved?

Section 80IB(10)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, PUNE BENCH “A”, PUNE

Before: SHRI ANIL CHATURVEDI, AM & SHRI PARTHA SARATHI CHAUDHURY, JM

For Appellant: Shri Mahesh Panse
For Respondent: Shri Vishwas Mundhe
Hearing: 27.06.2019Pronounced: 27.06.2019

आदेश / ORDER PER ANIL CHATURVEDI, AM :

These two appeals filed by the Revenue are emanating out of the 1. orders of Commissioner of Income Tax (A) – 5 and 13, Pune dated 09.12.2016 and 20.01.2017 for the assessment years 2013-14 and 2014-15, respectively.

2.

Before us, at the outset, both the parties submitted that though the appeals filed by the Revenue are for two different assessment years but the facts and issues involved in both the appeals are identical except for the assessment year and the amounts involved and therefore the submissions made by them while arguing one appeal would be equally applicable to the other appeal also and thus both the appeals can be

heard together. In view of the aforesaid submissions of both the parties,

we, for the sake of convenience, proceed to dispose of both the appeals

by a consolidated order but however, proceed with narrating the facts in

ITA No.1261/PUN/2017 for A.Y. 2013-14.

3.

The relevant facts as culled out from the material on record are as

under :-

Assessee is a firm engaged in the business of Promoters, Builders

and Contractors. Assessee filed its return of income for A.Y. 2013-14

on 20.09.2013 declaring total income of Rs.Nil. The case was selected

for scrutiny and thereafter assessment was framed u/s 143(3) of the Act

vide order dated 21.03.2016 and the total income was determined at

Rs.88,47,990/-. Aggrieved by the order of AO, assessee carried the

matter before Ld.CIT(A) who vide order dt.09.12.2016 (in appeal

No.PN/CIT(A)5/ITO, Ward-12(1), Pune/132/2016-17) granted partial

relief to the assessee. Aggrieved by the order of Ld.CIT(A), Revenue is

now in appeal before us and has raised the following grounds :

“1. On the facts and circumstances of the case and in law, the learned CIT(A) has erred in allowing the deduction u/s.80IB(10) of the Act, 1961 on pro rata basis in respect of Project Twin Nest.

2.

Whether on the facts and circumstances of the case and in law, the Ld. CIT(A), was justified in allowing the deduction u/s 80IB(10) of the Act to a housing project approved on 27.03.2006 which was still incomplete by 31.03.2011 in violation of Section 80IB(10)(a) Explanation (ii) of the Act which requires the completion certificate to be issue by the local authority for the earlier approved housing project.”

4.

Similar grounds have been raised by the Revenue in ITA

No.717/PUN/2018 for A.Y. 2014-15.

5.

Before us, at the outset, Ld.A.R. submitted that the appeal of the

Revenue is not maintainable on account of low tax effect and therefore,

the appeal of the Revenue be dismissed. Ld.D.R. did not object to the

aforesaid contention made by the Ld.A.R.

6.

We have heard the rival submissions and perused the material

available on record. On perusing the grounds of appeal raised by the

Revenue, we find that Revenue is aggrieved by the order of ld. CIT(A) in

respect of the relief given by him. As per the recent announcement of

Central Board of Direct Taxes (CBDT) dated 11.07.2018 (Circular No. 3

of 2018), no Department appeals are to be filed against relief given by ld.

CIT(A) before the Income Tax Appellate Tribunal unless the tax effect,

excluding interest, exceeds Rs.20 lakhs. The Circular further states that

the instructions will apply retrospectively to the pending appeals also.

In the present case, it is an undisputed fact that on the addition which

is in dispute, the tax effect is less than Rs.20 lakhs. In the absence of

any material placed on record by the Revenue to demonstrate that the

issue in the present appeal is covered by exceptions provided in para 10

of the aforesaid CBDT Circular, we are of the view that the monetary

limit prescribed by the instructions of the aforesaid CBDT Circular

would be applicable to the present appeal of the Department. We

therefore hold the present appeal of Revenue to be not maintainable on

account of low tax effect and accordingly dismiss the appeal of Revenue

without expressing any opinion on merits of the case. However, in case

there is any error in the computation of the tax effect involved or if for

any reason, the aforesaid CBDT Circular is not applicable, it would be

open to the Revenue to seek revival of the appeal. Thus, the grounds of

the Revenue are dismissed.

7.

In the result, the appeal of Revenue in ITA

No.1261/PUN/2017 for A.Y. 2013-14 is dismissed.

8.

Now we take up Revenue’s in ITA No.717/PUN/2018 for A.Y 2014-

15.

8.1. As far as the grounds raised in appeal in ITA No.717/PUN/2018

for A.Y. 2014-15 is concerned, in view of the submission of both the

parties that the facts of the case in the year being identical to the facts

and issue of the case in ITA No.1261/PUN/2017 for A.Y. 2013-14, we

therefore for the reasons stated herein while disposing of the appeal in

ITA No.1261/PUN/2017 for A.Y. 2013-14 and for similar reasons hold

that the appeal of Revenue to be not maintainable on account of low tax

effect and accordingly dismiss the appeal of Revenue. Thus, the

grounds of Revenue are dismissed.

9.

In the result, the appeal of Revenue in ITA No.717/PUN/ 2018

for A.Y. 2014-15 is dismissed.

10.

To sum up, both the appeals of Revenue are dismissed.

Order pronounced on the 27th day of June, 2019.

Sd/- Sd/- (PARTHA SARATHI CHAUDHURY) (ANIL CHATURVEDI) �या�यक सद�य / JUDICIAL MEMBER लेखा सद�य / ACCOUNTANT MEMBER

पुणे Pune; �दनांक Dated : 27th June, 2019. Yamini

आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent 3. CIT(A)-5, Pune & CIT(A)-13, Pune. 4. Pr. CIT-4, Pune & Pr.CCIT-Pune. 5 �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, “ए” / DR, ITAT, “A” Pune; 6. गाड� फाईल / Guard file.

आदेशानुसार/ BY ORDER // True Copy // व�र�ठ �नजी स�चव / Sr. Private Secretary आयकर अपील�य अ�धकरण ,पुणे / ITAT, Pune.

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