What did the Tribunal hold?

The Tribunal dismissed the Revenue's appeal. This was based on the CBDT circular fixing the monetary limit for filing appeals at Rs. 20 lakhs, and the tax effect in this case being below that limit.

The Revenue appealed against the CIT(A)'s order deleting additions made towards unexplained cash credits, investment in mutual funds, and credit card expenditure. The tax effect of these additions was calculated to be Rs. 16,87,466/-.

What were the issues?

The primary issue was whether the Revenue's appeal should be entertained given the low tax effect, in light of the CBDT's monetary limits for appeals.

ITO vs Hitesh Dholakia, Sec'Bad… | ITAT Hyderabad 2018

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

Before: SMT. P. MADHAVI DEVI & SHRI S. RIFAUR RAHMAN

For Appellant: Shri Sunil Kumar Jain

For Respondent: Shri P.V Subbaraju, Shri Sunil Kumar Jain

IN THE INCOME TAX APPELLATE TRIBUNAL HYDERABAD BENCH “A”, HYDERABAD BEFORE SMT. P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER ITA No. 1105/Hyd/2015 Assessment Year: 2010-11 ITO, vs. Shri Hitesh Dholakia, Ward – 10(1), Hyderabad. Hyderabad. PAN – ACGPD0690M

(Applicant) (Respondent) Revenue by : Shri P.V Subbaraju Assessee by : Shri Sunil Kumar Jain

Date of hearing : 18-07-2018 Date of pronouncement : 18-07-2018 ORDER PER P. MADHAVI DEVI, J.M.: This is Revenue’s appeal for the A.Y 2010-11 against the order of the Ld. CIT(A)-4, Hyderabad dated 12.06.2015. The Revenue has raised the following grounds of appeal:

“1. The Ld. CIT(A) erred in deleting the addition made towards unexplained cash credits of Rs. 36,40,434/- as the assessee failed to prove that the credits were out of earlier withdrawals from the same bank account. 2. The Ld. CIT(A) erred in deleting the addition of Rs. 14,20,000/- as the assessee has not furnished any evidence in support of source of funds which were invested in the ICICI prudential Mutual Fund in his individual capacity. 3. The Ld. CIT(A) ought to have sustained the addition towards unexplained expenditure incurred on credit card to the extent of Rs. 4,00,625/- as against Rs. 1,65,150/- as claimed by the assessee.

2 ITA.No. 1105/Hyd/2015 Sri Hitesh Dholakia, Hyderabad. 4. Any other ground that may be urged at the time of hearing”. 2. At the time of hearing, the Ld. Counsel for the assessee has brought to our notice the circular No. 03/2018 dated 11.07.2018 issued by the CBDT fixing the monetary limit for filing of the appeals by the Department before the Hon’ble ITAT to be Rs. 20 lakhs. He also brought to our notice that the circular mentions that pending appeals below the specified tax limit in para 3 thereof may be withdrawn / not pressed. He has given the computation of the tax effect in the appeal before us, which is under:

“The tax effect in respect of above additions is as follows:

S.No. Ground Amount involved (Rs.) No. 1 (i) 36,40,434/- 2 (ii) 14,20,000/- 3 (iii) 4,00,625/- Total 54,61,059/- The tax effect on the above even if considered @ 30% tax rate: Total Additions: Rs.54,61,059/- Tax @ 30%: Rs.16,38,317/- Add: Cess @3%: Rs. 49,149/- Total Tax Effec: Rs.16,87,466/-

The Ld. DR also confirmed that the computation made by the assessee is correct. In view of the same, the Revenue’s appeal is dismissed in view of the low tax effect.

3 ITA.No. 1105/Hyd/2015 Sri Hitesh Dholakia, Hyderabad.

In the result, the appeal filed by the Revenue is dismissed.

Pronounced in the open court on 18th July, 2018.

Sd/- Sd/- (S. RIFAUR RAHMAN) (P. MADHAVI DEVI) ACCOUNTANT MEMBER JUDICIAL MEMBER

Hyderabad, Dated: 18th July, 2018 KRK 1) Sri Hitesh Dholakia, F No. 106, Block No. III, DV Colony, Minister Road, Secunderabad. 2) ITO, Ward-10(1) Hyderabad. 3) CIT(A)-4, Hyderabad 4) Addl.CIT, Range-10, Hyderabad. 4) The Departmental Representative, I.T.A.T., Hyderabad. 5) Guard File.

ITO, WARD-10(1), HYD, HYDERABAD vs. HITESH DHOLAKIA, SEC'BAD, SECUNDERABAD

What did the Tribunal hold?

What were the facts?

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