ITO, WARD-1(1), PATNA vs. MACMILLAN LIFESCIENCE PVT LTD, PATNA

Per L.P.Sahu, AM: This appeal is filed by the Revenue against the order passed by learned CIT(A), Patna, dated 31.08.2018 for the assessment year 2011- 2012. 2. None appeared on behalf of the assessee even the case was called for second round of hearing. Therefore, we proceeded to dispose off the appeal of the Revenue after considering the submissions of ld.DR and the material evidence available on record. At the outset, we find that the tax effect in the present appeal of the Revenue is less than Rs.50 lakhs and, therefore, in view of CBDT Circular No.17/2019 dated 8th August, 2019, the appeal of the revenue is not maintainable.

in the appeal is less than Rs.50 lakhs, thus, bound by the Departmental

Instruction, however, ld. DR drew our attention to para 10 of the Circular No.3/2018, dated 11th July, 2018, which has been modified by Circular dated 20th August, 2018 and in terms of said modification, the Departmental Representatives made a prayer that permission to pray

for recall of the order may be granted in case any of the conditions in the reports made available by the AO subsequently show that the issues were required to be contested. The modified para is extracted

hereunder:

“10. Adverse judgments relating to the following issues should be contested on merits notwithstanding that the tax effect entailed is less than the monetary limits specified in para 3 above or there is no tax effect:

(a) Where the Constitutional validity of the provisions of an Act or Rule is under challenge, or (b) Where Board's order, Notification, Instruction or Circular has been held to be illegal or ultra vires, or (c) Where Revenue Audit objection in the case has been accepted by the Department, or (d) Where addition relates to undisclosed foreign income/undisclosed foreign assets (including financial assets)/ undisclosed foreign bank account.

(e) 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).

(f) Cases where prosecution has been filed by the Department and is pending in the Court. ”

before Income Tax Appellate Tribunal and High Courts and SLPs/appeals before Supreme Court keeping in view the monetary

limits and conditions specified below. Henceforth, appeals/SLPs shall not be filed in cases where the tax effect does not exceed the monetary

limits given hereunder:

S. No. Appeals/SLPs in Income-tax matters Monetary Limit (Rs.)

No.17/2019, dated 8th August, 2019, whereby enhancing the monetary

limits for filing of appeals by the Department before the Income Tax

Appellate Tribunals, High Courts and SLPs/appeals before the Supreme

Court as under :-

S. No. Appeals/SLPs in Income-tax matters Monetary Limit (Rs.)

dated 8th August, 2019, we are of the view that the Revenue should

have either not filed the instant appeal before the Tribunal or withdrawn the same as the tax effect in the appeal is admittedly less

than the prescribed limit, i.e., Rs. 50,00,000/- for not filing the appeal,

which is not maintainable as per the provisions of Section 268A of the Income Tax Act, 1961. 7. The coordinate bench of the Tribunal in ITA No.1398/Ahd/2004,

order dated 14.08.2009 has dismissed the appeals filed by the Revenue

below the monetary limit of Rs.50,00,000/- as prescribed by the CBDT

vide Circular No.17/2019, dated 8th August, 2019. The relevant

observations of the Tribunal are as under :-

“5. Having considered the rival submissions and having perused the material on record, we do not have slightest of hesitation in holding that the concession extended by the CBDT not only applies to the appeals to be filed in future but it is also equally applicable to the appeals pending for disposal as on now. Our line of reasoning is this. The circular dated 8thAugust 2019 is not a standalone circular. It is to be read in conjunction with the CBDT circular no 3 of 2018 (and subsequent amendment thereto), and all it does is to replace paragraph nos. 3 and 5 of the said circular. This is evident from the following extracts from the circular dated 8thAugust2019:

S.No. Appeals/SLPs in Income-tax Monetary Limit matters (Rs.)

“5. The Assessing Officer shall calculate the tax effect separately for every assessment year in respect of the disputed issues in the case of every assessee. If in the case of an assessee, the disputed issues arise in more than one assessment year, appeal can be filed in respect of such assessment year or years in which the tax effect in respect of the disputedissuesexceedsthemonetarylimitspecifiedinpara 3.No appeal shall be filed in respect of an assessment year or years in which the tax effect is less than the monetary limit specified in para 3. Further, even in the case of 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 no appeal shall be filed in respect of an assessment year or years in which the tax effect is less than the monetary limit specified in para 3. In case where a composite order/ judgement involves more than one assessee, each assessee shall be dealt with separately”

No.17/2019 dated 8th August, 2019, the modifications shall come into effect from the date of this issue of this Circular i.e. 8.8.2019. Therefore, it is not applicable to the pending appeals.

the order dated 14.8.2019 of the ITAT Ahmedabad Bench in the case of Dinesh Mudhavlal Patel (supra), we are of the view that the relaxation

in the monetary limit in departmental appeals vide circular dated 8th

August, 2019 shall be applicable to the pending appeals in addition to the appeals to be filed henceforth. Thus, the contention of ld D.R. is dismissed.

going into merits of the case. However, it is made clear that the Department is at liberty to file Miscellaneous Application, if the tax effect is found to be more than the prescribed limit of Rs.50,00,000/- as per the amendment carried out by the CBDT in Circular No.17/2019, dated 8th August, 2019, or any of the conditions etc. as available in the amended para 10 of Circular No.3/2018, dated 20th August, 2018. Accordingly, the appeal of the Revenue deserves to be dismissed.

Order pronounced in the open court on 18/09/2019. (C.M.GARG) (L.P.SAHU) "या"यक सद"य / JUDICIAL MEMBER लेखा सद"य / ACCOUNTANT MEMBER पटना /Patna; "दनांक Dated :18 /09/2019 S.Sinha. (PS) आदेश क" ""त"ल"प अ"े"षत/Copy of the Order forwarded to : अपीलाथ" / The Appellant- .

आदेशानुसार/ BY ORDER,

( Private Secretary) आयकर अपील"य अ"धकरण, पटना / ITAT, Patna