DCIT,CIRCLE-3(2), NEW DELHI vs. ASF INFRASTRUCTURE PVT. LTD., NEW DELHI

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ITA 4555/DEL/2017Status: DisposedITAT Delhi04 March 2020AY 2014-154 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 noted that the tax effect of the appeal was below the enhanced monetary limit of Rs. 50 lakhs as per CBDT Circular No. 17/2019. Therefore, the appeal was dismissed.

What were the facts?

The Revenue filed an appeal against the deletion of additions made by the AO. The assessee argued that the tax effect was below the prescribed monetary limit for appeals, citing CBDT circulars.

What were the issues?

Whether the departmental appeal should be dismissed on the grounds of low tax effect as per CBDT circulars, despite the merits of the case.

Which sections of the Income-tax Act were involved?

Section 14A,Section 40(a)(ii),Section 268A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH: ‘A’, NEW DELHI

Before: SHRI H.S. SIDHU & SHRI N.K. BILLAIYA

ORDER PER H.S. SIDHU, JM: This appeal filed by the Revenue is directed against the impugned order passed by the Ld. CIT(A)-I, New Delhi in relation to assessment year 2014-15 on the following grounds:-

1.

The Ld. CIT(A) erred in law and on facts in deleting

addition of Rs. 60,87,646/- made by the AO on account of disallowance u/s. 14A of Income Tax

Act, 1961 r.w. Rule 8D.

2. The Ld. CIT(A) erred in law and on facts in deleting

addition of Rs. 1,34,815/- made by the AO on account of disallowance of interest on service tax u/s. 40(a)(ii) of Income Tax Act, 1961.

3.

The appellant craves leave for reserving the right to amend, modify, alter, add or forego any ground(s)

of appeal at any time or during the hearing of this appeal.

2.

At the time of hearing, Ld. Counsel for the Assessee has filed a chart of tax effect calculation and stated that the total tax payable in this Departmental Appeal is Rs. 21,15,014/- which shows that the tax effect involved in this appeal is less than the prescribed limit of Rs.50 lakhs, hence, he requested that this appeal of the Revenue may be dismissed in view of latest CBDT Circular No. 17/2019 Dated 08.08.2019 wherein the monetary limit for filing the appeal before the Appellate Tribunal by the Department have been enhanced to Rs.50 lakhs.

It is noted that vide Circular No.3/2018 Dated 11thJuly, 2018 3. issued by CBDT under section 268A of the I.T. Act, it has been directed that the Department shall not file appeal before the Tribunal in case where the tax effect does not exceed the monetary limit of Rs.20 lakhs. It is also directed that this instruction will apply retrospectively to pending appeals and appeals to be filed henceforth in the Tribunal. Pending appeals below the specified tax limit may be withdrawn/not pressed by the Department. Recently, the CBDT vide Circular No.17/2019 Dated 08.08.2019 amended its earlier Circular No.3/2018 (Supra) whereby it has been directed that monetary limit for filing the Departmental appeal in Income Tax Cases may be enhanced further through this amendment in para-3 of the Circular mentioned above and accordingly, the monetary limit for filing the appeal before the Appellate Tribunal have been enhanced to Rs.50 lakhs. Since Circular No.17/2019 Dated 08.08.2019 have been issued to amend its earlier Circular No.3/2018 dated 11.7.2018 (Supra), therefore, all the conditions of earlier Circular No.3/2018 shall apply accordingly. This view is supported by the ITAT, Ahemedabad ‘A’ Bench decision dated 14th August, 2019 passed in the case of Income Tax Officer, Ward 3(2), Ahmedabad vs. Dinesh Madhvlal Patel and 627 others passed in (AY 1998-99).

4.

Ld. Sr. DR did not controvert the aforesaid proposition.

5.

Keeping in view of the facts and circumstances as explained above and in view of the aforesaid CBDT Circulars as well as decision dated 14th August, 2019 of the ITAT, Ahemedabad ‘A’ Bench passed in the case of Income Tax Officer, Ward 3(2), Ahmedabad vs. Dinesh Madhvlal Patel and 627 others passed in (AY 1998-99), the appeal of the Department is dismissed.

6.

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

The decision is pronounced on 04.03.2020.

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