ITO, NEW DELHI vs. M/S. MSS COSMETICS PVT. LTD., DELHI

[A]. This appeal has been filed by Revenue against the order dated 14.11.2014 passed by Learned Commissioner of Income Tax(Appeals)-IX, New Delhi [in short, “Ld.CIT(A)”] pertaining to assessment year 2005-06. In this appeal, the tax effect is less than the monetary limit fixed by the Central Board of Direct Taxes (in short “CBDT”) in its Circular No.17/2009 dated 08.08.2019. The Revenue has raised following grounds of appeal:-

(1) Whether on facts and in circumstances of the case & in law, the Ld. CIT(A) has erred in deleting the additions of Rs. 26,00,000/- made by the AO on account of Unexplained Investment u/s 69 of the IT Act, 1961?

ITA No: -649/Del/2015

(2) Whether on facts and in circumstances of the case & in law, the Ld. CIT(A) has erred in deleting the addition to the tune of Rs. 81,72,077/- made by the AO on account of Unexplained Credits u/s 68 of the I.T. Act, 1961? (3) Whether on facts and in circumstances of the case & in law, the Ld. CIT(A) has erred in estimating expenses of the assessee at 75% of receipts without any basis and without verifying any detail of expense claimed? (4) Whether on facts and in circumstances of the case & in law, the Ld. CIT(A) has erred in admitting Additional Evidence under rule 46A when the case of the assessee did not fall under any of the exception provided therein? (5) That the order of the Ld. CIT(A) is erroneous and is not tenable on facts and in law.”

[B]. At the outset, it was brought to our notice by learned counsel for the Assessee, 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 of 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. Therefore, in view of the foregoing, we are of the view that this appeal filed by Revenue is not maintainable.

The learned Departmental Representative also did not press the appeal. Accordingly, this appeal is dismissed being not pressed, and also not maintainable, having regard to aforesaid CBDT Circular Page | 2

ITA No: -649/Del/2015 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.

[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 recall of this order and, for restoration of the appeal if it is found that this appeal of Revenue is not covered by aforesaid CBDT Circulars dated 08.08.2019 and 11.07.2018.

[D]. In the result, the 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