DCIT, MEERUT vs. M/S. NIPRO GLASS INDIA PVT. LTD., MEERUT

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ITA 6258/DEL/2016Status: DisposedITAT Delhi18 October 2019AY 2011-124 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 was below the enhanced monetary limit for filing appeals by the Revenue as per CBDT circulars. Consequently, the Revenue did not press the appeal.

What were the facts?

The Revenue filed an appeal against an order of the CIT(A) which deleted additions made by the AO. The additions pertained to unexplained investment and estimated income after rejection of books of account. The tax effect in the appeal was below Rs. 50,00,000/-.

What were the issues?

Whether the appeal filed by the Revenue is maintainable given the tax effect and CBDT circulars regarding monetary limits for appeals. Whether the additions made by the AO were correctly deleted by the CIT(A).

Which sections of the Income-tax Act were involved?

Section 69,Section 133(6),Section 145(3),Section 254(2)

AI-generated summary — verify with the full judgment below

(A) This appeal by Revenue is filed against the order of Learned Commissioner of Income Tax (Appeals), Meerut, [“Ld. CIT(A)”, for short], dated 02.09.2016 for Assessment Year 2011-12. Grounds taken in this appeal of Revenue are as under:

“1. Whether in the facts and circumstances of the case, the ld. Commissioner of Income Tax (Appeals) has erred in law and fact in deleting the addition of Rs. 12,10,544/- made by the A.O. u/s 69 of the I.T. Act, 1961 on a/c of unexplained investment due to unverified advances to parties shown by the assessee, taking technical grounds that sec. 69 of the Act was not applicable and also ignoring ITA No.- 6258/Del/2016. M/s Nipro Glass India Pvt. Ltd. A.O.’s reasoning that no reply was received in response to the notice u/s 133(6) of the I.T. Act, 1961.

2.

Whether in the facts and circumstances of the case, the ld. Commissioner of Income Tax (Appeals) has erred in law and fact in deleting the addition of Rs. 55,28,430/- made by the A.O. on account of 5% N.P. of total business receipts after rejecting books of a/c u/s 145(3) of the Act, observing that the addition has been made of NP rather than GP whereas other additions have also been made, ignoring detailed reasoning of A.O. for rejection of books and also ignoring that other additions of creditors and advances to parties were not in the nature of additions under the head of expenditure, therefore addition of NP was justified. Otherwise also the rate of 5% N.P. was quite reasonable in view of facts and circumstances of the case.

3.

That in the facts and circumstances of the case, the order of ld. Commissioner of Income Tax (Appeals), Meerut may be set aside and that of the AO be restored.

4.

That the appellant craves leave to add, modify and or delete any ground(s) of appeal.”

(B) At the outset, Learned Senior Departmental Representative [“Ld. Sr. DR”, for short] brought to our notice, at the time of hearing that tax effect in this appeal is below Rs. 50,00,000/-. Vide recent CBDT Circular No. 17/2019 dated 08.08.2019 read with earlier CBDT Circular No. 3 of 2018, dated 11.07.2018, minimum threshold limit of tax effect for filing of appeals by Revenue in Income Tax Appellate Tribunal (“ITAT”, for short) has been enhanced to Rs. 50,00,000/-. In a subsequent clarification issued by CBDT vide F.No. 279/Misc/M-93/2018-ITJ, dated 20/08/2019, it has been clarified by CBDT that the aforesaid revised monetary limit is also applicable to all pending appeals in ITAT. Having regard to the aforesaid, the Ld. Sr. DR for Revenue did not press the appeal. We are also of the view that this appeal is not maintainable having regard to aforesaid CBDT Circular No. 17/2019 dated 08.08.2019 read with aforesaid CBDT Circular No. 3 of 2018 in the light of aforesaid clarification dated 20/08/2019.

ITA No.- 6258/Del/2016. M/s Nipro Glass India Pvt. Ltd. Accordingly, this appeal is dismissed being not pressed, and also being not maintainable.

(C) Before leaving, we clarify that Revenue will be at liberty to approach Income Tax Appellate Tribunal U/s 254(2) of Income Tax Act, 1961 seeking for restoration of this appeal if it is found that appeal of Revenue is not covered by aforesaid CBDT Circulars dated 08.08.2019 and 11.07.2018.

(D) In the result, this appeal by Revenue is dismissed. Our decision was orally pronounced in the Open Court after conclusion of hearing on the date of hearing. Now, this written order is pronounced in Open Court, on 18/10/2019.

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