DCIT CENT. CIR. 8(3) ERSTWHILE DCIT CENT. CIR. - 46, MUMBAI vs. ROSY BLUE (INDIA) PVT. LTD., MUMBAI

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ITA 4093/MUM/2018Status: DisposedITAT Mumbai02 March 2021AY 2009-103 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 held that the revenue's appeal was not maintainable as the tax effect was below the monetary limit set by the CBDT. The appeal was dismissed on this preliminary ground.

What were the facts?

The revenue filed an appeal against the CIT(A)'s order concerning the assessment year 2009-10. The appeal was filed despite the tax effect being below the threshold limit prescribed by the CBDT for filing appeals before the ITAT.

What were the issues?

The primary issue was the maintainability of the revenue's appeal before the ITAT due to the low tax effect. Other grounds related to depreciation, business income vs. house property income, and disallowance under Section 14A were not adjudicated.

Which sections of the Income-tax Act were involved?

Section 14A

AI-generated summary — verify with the full judgment below

Cases cited in this judgment(1)Show list

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Income Tax Appellate Tribunal, “D” Bench, Mumbai

For Appellant: Shri Nitesh Joshi
For Respondent: Shri Ajit Kumar Srivastava
Hearing: 02.03.2021Pronounced: 02.03.2021

O R D E R Per Shamim Yahya (AM) :-

This appeal by the revenue is directed against order of learned Commissioner of Income Tax (Appeals) [in short learned CIT(A)] dated 26.3.2018 and pertains to assessment year 2009-10.

2.

The grounds of appeal

read as under :- 1. "Whether in the facts and the circumstances of the case and in law, the Ld. CIT(A) is justified in deleting the disallowance of Rs. 97,22,965/-on account of depreciation on Kandivali Factory premises when the said premises along with all its fixtures is being used by agencies to whom job work is outsourced by the assessee?

2. "Whether in the facts and the circumstances of the case and in law, the Ld. CIT(A) is justified treating receipts from job contractors amounting to Rs. 24.000/- as business income instead of income from House Property considering the said premises at Kandivali along with all its fixtures have been leased to the outsourcing agents (job contractors)?

3. "Whether in the facts and the circumstances of the case and in law, the Ld. C1T(A) has erred in restricting the disallowance u/s 14A r.w.Rule 8D(2)(iii) made by the Assessing Officer to Rs. 1,30,000/- without appreciating the fact that the disallowance u/s 14A of the Act has been carried out as per the formula laid down in Rule 8D of the Income tax Rules and by following the 2 M/s. Rosy Blue (India) Pvt. Ltd.

CBDT Circular No. 5/2014 dated 11/02/2014 wherein it had been held that disallowance u/s 14A r.w.r 8D can be even made when the assessee had not earned any exempt income during the year."

4. "Whether in the facts and the circumstances of the case and in law, the Ld. CIT(A) has erred in deleting the disallowance u/s 14A r.w.Rule 8D(2)(ii) of Rs. 12,16,993/- made by the Assessing Officer by relying on decision of the Hon'ble Bombay High Court in the case of Reliance Utilities & Power Ltd (313 ITR 340) without appreciating the fact that the said ratio is laid down prior to the introduction of Rule 8D for completion of disallowance and hence no presumption with regards to the same remains?" 5. "Whether in the facts and the circumstances of the case and in law, the Ld. CIT(A) was justified in deleting the disallowance of Rs. 16.188/- on account of bogus purchases and restricting the disallowance to 5% ignoring the decision of the Hon'ble Gujarat High Court in the case of N.K. Proteins Ltd. Vs. DCIT in which upto 100% of bogus purchases were disallowed and in which SLP of the assessee is dismissed?"

3.

At the outset it is noted that that the tax effect in this case is below the limit of Rs. 50,00,000/- fixed by CBDT vide Circular No. 17/2019 dated 8/8 2019 for filing appeal before the ITAT. Hence this appeal by the revenue is not maintainable.

4.

Learned Departmental Representative could not dispute that the tax effect is below the said limit. He could not point out that the appeal falls in any of the exceptions carved in said circular.

5.

Upon careful consideration we find that as the tax effect is below the limit fixed by CBDT for filing appeals before the ITAT, this appeal by the revenue is liable to be dismissed in limine. The revenue will have liberty to seek restoration of the appeal if the tax effect is found to be beyond the above limit.

6.

Accordingly the appeal stands dismissed as such.

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