THE DCIT, CIRCLE-1(2), BARODA vs. SMT. PALLAVI LAHERI SHAH, BARODA

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ITA 193/AHD/2017Status: DisposedITAT Ahmedabad24 August 2018AY 2013-143 pages
AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the appeal was not maintainable due to the low tax effect, as per CBDT Circular No. 3/2018. The appeal was dismissed on this ground.

What were the facts?

The Revenue appealed against the deletion of disallowance on excess claim of deduction under Section 54EC. The tax effect of the relief granted by the CIT(A) was less than Rs. 20 lakhs.

What were the issues?

Whether an appeal filed by the Revenue is maintainable when the tax effect is below the prescribed limit by CBDT circular. The applicability of CBDT Circular No. 3/2018 on pending appeals.

Which sections of the Income-tax Act were involved?

Section 54EC,Section 268A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “ D ” BENCH, AHMEDABAD

Before: SHRI AMARJIT SINGH&

For Appellant: Shri Lalit P.Jain, Sr.DR
For Respondent: Shri Surendra Modiani, AR
Hearing: 07/08/2018

PER Ms. MADHUMITA ROY - JM:

The instant appeal has been filed by the Revenue before us against the order dated 24.10.2016 passed by the Commissioner of Income Tax(Appeals)-5, Vadodara [Ld.CIT(A) in short] for Assessment Year (AY) 2013-14.

2.

The ground raised by the Revenue reads as under: On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in law and fact in deleting the disallowance made on account of excess claim of deduction of Rs.50,00,000/- u/s. 54EC of the Act, without appreciating the fact that the threshold limit of the allowable deduction u/s.54EC is Rs.50,00,000/- only. Where as the assessee’s claim of deduction of Rs.1,00,00,000/- u/s.54EC of the Act, has been allowed by the Ld.CIT(A).

3.

At the outset, after going through the ground of appeal and the impugned orders of the Revenue authorities below, a query was raised by the Bench as to applicability and

- 2 - ITA No.193/Ahd/2017 DCIT vs. Pallavi Laheri Shah Asst.Year – 2013-14 maintainability of the appeal filed by the Revenue in view of recent CBDT Circular No.3/2018 dated 11.7.2018 restricting the filling of the appeal by the Revenue where the tax effect is below Rs.20 lakhs, the ld.DR did not dispute the same and submitted that the issue is left to the Tribunal to be decided in accordance with law.

4.

We find that the appeal of the Revenue is presented on 23.01.2017. On 11.7.2018 the CBDT has issued Instructions bearing No. 3 of 2018 under file No.F.No.279/Misc.142/2007-ITJ(Pt) prohibiting its subordinate authorities from filing of the appeal to the Tribunal against the order of the CIT(A) where the tax effect by virtue of the relief given by the CIT(A) is less than Rs.20 lakhs. The instructions have been made applicable with retrospective effect, meaning thereby, these instructions are applicable on pending appeals also. In the present case, “tax effect” on the total income assessed minus the tax that would have been chargeable had such total income been reduced by the amount of income in respect of the issue against which appeal is filed, is less than Rs.20 lakhs. Further, the case of the Revenue does not fall within the ambit of exceptions provided in the Circular. Thus, keeping in view the above CBDT circular and provisions of section 268A of the Income Tax Act, we are of the view that the present appeal of the Revenue deserves to be dismissed. It is accordingly dismissed.

However, it is observed that in case on re-verification at the end of the AO it comes to the notice that the tax effect is more or Revenue’s case falls within the ambit of exceptions provided in the Circular, then the Department will be at liberty to approach the Tribunal for recall of this order. Such application should be filed within the time

- 3 - ITA No.193/Ahd/2017 DCIT vs. Pallavi Laheri Shah Asst.Year – 2013-14 period prescribed in the Act. In view of the above, the appeal of the Revenue is dismissed due to low tax effect.

5.

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

This Order pronounced in Open Court on 24/08/2018

Sd/- Sd/- (AMARJIT SINGH) ( Ms. MADHUMITA ROY ) ACCOUNTANT MEMBER JUDICIAL MEMBER

Ahmedabad; Dated 24/ 08 /2018

ट�.सी.नायर, व.�न.स./T.C. NAIR, Sr. PS

आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त(अपील) / The CIT(A)-5, Vadodara �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 5. 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER, स�या�पत ��त //True Copy//

उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील�य अ�धकरण, अहमदाबाद / ITAT, Ahmedabad 1. Date of dictation .. 7.8.2018 2. Date on which the typed draft is placed before the Dictating Member …7.8.2018 3. Other Member… 4. Date on which the approved draft comes to the Sr.P.S./P.S…………….. 5. Date on which the fair order is placed before the Dictating Member for pronouncement…… 6. Date on which the fair order comes back to the Sr.P.S./P.S…….24.8.18 7. Date on which the file goes to the Bench Clerk…………………24.8.18 8. Date on which the file goes to the Head Clerk…………………………………... 9. The date on which the file goes to the Assistant Registrar for signature on the order…………………….. 10. Date of Despatch of the Order………………

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