DCIT, CENTRAL CIRCLE-1, VISAKHAPATNAM vs. GRANDHI SRI VENKATA AMARENDRA, ELURU

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ITA 180/VIZ/2025Status: DisposedITAT Visakhapatnam12 June 2025AY 2020-214 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 appeal filed by the Revenue was not maintainable. This decision was based on the CBDT Circular No. 09/2024, which specifies that appeals with a tax effect below Rs. 60,00,000/- are not to be filed or pursued. The Tribunal noted that the tax effect in this case was approximately Rs. 3,00,000/-, falling below the prescribed monetary limit. Consequently, the Tribunal found that the appeal was not maintainable and dismissed it in limine. The Tribunal did not delve into the substantive grounds of appeal raised by the Revenue, as the preliminary issue of maintainability was decided against the Revenue.

What were the facts?

This appeal was filed by the Revenue against an order of the Ld. Commissioner of Income Tax (Appeals), Visakhapatnam-3, dated 10.01.2025. The appeal pertains to Assessment Year 2020-21 and arises from an order passed under section 271D of the Income Tax Act, 1961, dated 23.11.2023. The assessee is Grandhi Sri Venkata Amarendra. The Revenue raised several grounds challenging the relief granted by the Ld. CIT(A). However, at the outset of the hearing, the assessee's representative argued that the appeal was not maintainable due to the tax effect being below Rs. 60 lakhs, citing CBDT Circular No. 09/2024. The Revenue's representative did not object to this submission.

What were the issues?

The primary issue before the Tribunal was whether the appeal filed by the Revenue was maintainable. The assessee contended that the appeal was not maintainable as the tax effect, as per Form 36, was approximately Rs. 3,00,000/-, which is below the threshold of Rs. 60,00,000/- stipulated in CBDT Circular No. 09/2024. The assessee argued that this circular, effective from its date of issue, applies to appeals pending before the Tribunal and mandates withdrawal of such appeals. The Revenue did not present any arguments against this submission, having not objected to the assessee's contention regarding the maintainability of the appeal based on the tax effect.

Which sections of the Income-tax Act were involved?

Section 271D,Section 269SS

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, VISAKHAPATNAM “DIVISION” BENCH, VISAKHAPATNAM

Before: SHRI VEERAVALLI DURGA RAO, HON’BLE

For Appellant: Shri MV Prasad, CA
For Respondent: Dr. Aparna Villuri, Sr.AR

आदेश /O R D E R

PER SHRI S BALAKRISHNAN, ACCOUNTANT MEMBER:

1.

This appeal is filed by revenue against order of the Ld. Commissioner of Income Tax (Appeals), Visakhapatnam-3 [hereinafter in short “Ld. CIT(A)”]

I.T.A.No.180/VIZ/2025 Grandhi Sri Venkata Amarendra Vide DIN & order No. ITBA/APL/S/250/2024-25/1072055103(1) dated 10.01.2025 for the A.Y. 2020-21 arising out of the order passed under section 271D of Income Tax Act, 1961 (in short ‘Act’) dated 23.11.2023.

2.

Revenue has raised following grounds in its cross objection: -

1. The Ld. CIT(A) erred in allowing relief to the assessee, by relying upon the decision of Hon'ble High Court of Andhra Pradesh, thought the said Order was not accepted by the Department and a SLP is proposed against the said order.

2. The Ld. CIT(A) erred in holding that, unless the Assessing Officer during the assessment proceedings arrives at a finding that there has been a violation of the provision of sec. 269SS of the Income-tax Act, 1961, there will not be any occasion to the Joint Commissioner, who is not the Assessing officer, to exercise his jurisdiction to levy penalty under section 271D, when upon reference by the Assessing Officer, the competent authority i.e., the Joint/Additional Commissioner of Income-tax being the levying authority had himself satisfied and levied penalty.

3. The Ld. CIT(A) is erred in holding that, unless the Assessing Officer during the assessment proceedings arrives at a finding that there has been a violation of the provision of sec. 269SS of the Income-tax Act, 1961, there will not be any occasion to the Joint Commissioner, who is not the Assessing officer, to exercise his jurisdiction to levy penalty under section 271D of the Act, when the said provisions do not specify the role of the Assessing Officer in drawing satisfaction, but statutorily permit the Joint/Additional Commissioner of Income-tax for imposing the penalty.

4. The Ld. CIT(A) ought to have appreciated the fact that the Hon'ble High Court relied upon the decision of the Hon'ble Supreme Court in the case of Jai Laxmi Rice Mills [(2015) 64 Taxmann.com (SC)], when the facts and circumstances of the case are distinguishable from the facts and circumstances of the present case.

5. The Ld. CIT(A) is erred in mis-understanding the difference between substantive provision i.e., 269SS and machinery provision 271D, which is purely procedural in nature.

6. The Ld. CIT(A) is erred in holding that the Addl. Commissioner of Income-tax passed an order us 271D without going through the facts on cash loans, by ignoring the fact that the Assessing Officer during the course of assessment proceedings referred the matter to the Add. Commissioner of Income-tax in the procedural part of imposing penalty, which is derived

Page No. 2 I.T.A.No.180/VIZ/2025 Grandhi Sri Venkata Amarendra from the substantive part of violation of 269SS, pointed out by Assessing Officer.

7. The Ld. CIT(A) misinterpreted the provision in a piecemeal way instead of reading it in a harmonious construction, wherein the provision of Law should be read as a whole and not an isolation and right intention of Legislature and providing the best interpretation which defines the intention of Legislature.

8.

The Ld. CIT(A) has misconstrued the substantial provision as machinery provision.

9.

The Ld. CIT(A) ought to have considered the fact that penalty proceedings /s 271D are independent from assessment proceedings.

10.

Any other ground that may be urged at the time of hearing.”

3.

At the outset, Ld. Authorised Representative [hereinafter “Ld.AR”] argued that consequent to CBDT Circular No. 09/2024 dated 17th September, 2024, the tax effect of the appeal is less than Rs.60 lakhs and hence it is not maintainable.

4.

Per contra, Ld. DR not objected to the submissions of the Ld.AR.

5.

We have heard both sides and perused the material available on record. Consequent to the issuance of Circular No. 9/2024 dated 17th September, 2024 wherein it was clearly mentioned that in Para No. 5 as follows: -

“5. The modification shall come into effect from the date of issue of this circular, this circular will apply to SLPs/appeal to be filled hence forth in SC/HCs/Tribunal. It shall also apply to the SLPs/appeals pending before Supreme Court/High Courts/Tribunal which may accordingly be withdrawn.”

6.

We are therefore of the considered view that the appeal is not maintainable before the Tribunal, since the tax effect as per Form 36 is around Rs.3,00,000/-

Page No. 3

I.T.A.No.180/VIZ/2025 Grandhi Sri Venkata Amarendra which is below Rs.60,00,000/- and hence appeal is not maintainable and dismissed in limine.

7.

In the result, appeal of the revenue is dismissed in limine.

Order pronounced in the open court on 12th June,2025.

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