ASSISTANT COMMISSIONER OF INCOME TAX, KOTA vs. M/S JHALAWAR NAGRIK SAHKARAI BANK LTD., JHALAWAR

PER VIJAY PAL RAO, JM :

This appeal by the Revenue is directed against the order dated 5th May, 2018

of ld. CIT (A), Kota for the assessment year 2013-14. The revenue has raised the

following grounds :-

“ On the facts and in the circumstances of the case, the ld. CIT (A) has erred in :-

(i) On the facts and in the circumstances of the case, the ld. CIT (A) has erred in deleting the addition of Rs. 2,32,764/- made by the AO u/s 14A r.w.r. 8D.

(ii) The appellant craves liberty to raise additional ground and to modify/amend the ground of appeal at the time of hearing.

2 ITA No. 953/JP/2018 Jhalawar Nagrik Sahkari Bank Ltd., Jhalawar.

The issue falls under exception as mentioned in para 10(b) of Board’s Circular No. 3/2018 dated 11.07.2018.”

impugned order of ld. CIT (Appeals). As apparent from the ground no. 1 of the

revenue’s appeal that the tax effect in this appeal is not exceeding Rs. 20 lacs and,

therefore, the monetary limit provided under CBDT Circular No. 3/2018 dated

11.07.2018 renders the appeal filed by the department not maintainable. The ld.

D/R has submitted that the issue of disallowance made by the AO under section 14A

read with Rule 8D which was deleted by the ld. CIT (Appeals) without following the

Circular No. 5/2014. Hence the case falls in the exception provided in para 10(b) of

the Circular. We note that the ld. CIT (Appeals) has deleted the disallowance made

by the AO on the ground that the assessee has not earned any exempt income and,

therefore, following the various decisions on this issue, no disallowance can be made

under section 14A. Thus it is clear that the ld. CIT (Appeals) has not given the

finding on the issue by holding that the Circular issued by the CBDT is illegal or ultra

virus but the issue has been decided by following the decisions of Hon’ble High

Courts. Hence when no issue is involved in this case where the CBDT circular is

either held illegal or ultra virus, then the case would not fall in the exception under

para 10(b) of the Circular No. 3/2018 as claimed by the revenue. Accordingly when

the tax effect in the appeal of the revenue is below the limit set out by CBDT for the

appeal, the appeal of the assessee is not maintainable in view of CBDT Circular No. 3 of

2018 dated 11.07.2018. Accordingly the appeal of the Department is dismissed as not maintainable.

3 ITA No. 953/JP/2018 Jhalawar Nagrik Sahkari Bank Ltd., Jhalawar.

Order is pronounced in the open court on 12/10/2018.

Sd/- Sd/- (foØe flag ;kno) (fot; iky jkWo ½ (VIKRAM SINGH YADAV ) (VIJAY PAL RAO) U;kf;d lnL;@Judicial Member ys[kk lnL;@Accountant Member

Jaipur Dated:- 12/10/2018. Das/

आदेश की प्रतिलिपि अग्रेषित@ब्वचल वf जीम वतकमत वितूंतकमक जवरू

सहायक पंजीकार@ Aेेपेजंदज. त्महपेजतंत

4 ITA No. 953/JP/2018 Jhalawar Nagrik Sahkari Bank Ltd., Jhalawar.