ITO, NEW DELHI vs. M/S. RELIABLE DIESEL ENGINEERS PVT. LTD., NEW DELHI

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ITA 1211/DEL/2017Status: DisposedITAT Delhi03 September 2019AY 2010-116 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 less than Rs. 50 lakhs, the enhanced monetary limit for departmental appeals. Therefore, the appeal was dismissed based on the CBDT circulars.

What were the facts?

The Revenue filed an appeal against the CIT(A)'s order deleting additions made by the AO. The assessee argued that the tax effect was below the monetary limit for appeals as per CBDT circulars.

What were the issues?

Whether the departmental appeal should be dismissed due to the tax effect being below the prescribed monetary limit for appeals to the Tribunal as per CBDT circulars.

Which sections of the Income-tax Act were involved?

Section 268A

AI-generated summary — verify with the full judgment below

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

Before: SHRI H.S. SIDHU & SHRI O.P. KANT

This appeal is filed by the Revenue against the impugned order passed by the Ld. CIT(A)-11, New Delhi relating to assessment year 2010-11 on the following grounds:-

1. Whether the Ld. CIT(A) erred in law and on merit without appreciating the facts and circumstances of the case in deleting the addition of Rs. 69,41,959/- made by AO on account of trading additions.

2. Whether the Ld. CIT(A) erred in law and on merit for accepting the assessee contention

that the expenditure of Rs. 3,22,895/- are revenue in nature ignoring the facts that the assessee failed to substantiated its claimed that expenditure such as imported tools, purchased of electrical equipments etc. Are revenue expenditure.

3. The applicant craves to be allowed to add any fresh ground(s) of appeal and / or deleted or amend any of the ground(s) of appeal.

2.

At the time of hearing, Ld. Counsel for the Assessee has stated that the tax effect involved in this Departmental Appeal is less than Rs.50 lakhs, hence, he requested that the 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.

3.

It is noted that vide Circular No.3/2018 Dated 11thJuly, 2018 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. CIT(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 03.09.2019.

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