ITO - 21(1)(2), MUMBAI vs. APARNA A. HENDRE, MUMBAI

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ITA 5225/MUM/2018Status: DisposedITAT Mumbai18 December 2019AY 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 appeal was not maintainable as the tax effect of the penalty was below the prescribed monetary limit. The circulars apply to each proceeding separately, and no exception was provided for penalty proceedings.

What were the facts?

The revenue appealed against the deletion of penalty imposed under Section 271(1)(c) for bogus purchases. The penalty amount was Rs. 42,296, which was less than the monetary limit prescribed by CBDT circulars.

What were the issues?

Whether the revenue's appeal is maintainable when the penalty amount is below the monetary limit specified in CBDT circulars, and if the circulars apply to penalty proceedings separately from quantum proceedings.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “A” BENCH, MUMBAI

Before: HON’BLE SHRI VIKAS AWASTHY, JM & HON’BLE SHRI MANOJ KUMAR AGGARWAL, AM

For Appellant: Shri S. Michael Jerald- Ld. DR

सुनवाई क� तार�ख/ : 18/12/2019 Date of Hearing घोषणा क� तार�ख / : 18/12/2019 Date of Pronouncement आदेश / O R D E R Manoj Kumar Aggarwal (Accountant Member): - Aforesaid appeal by revenue for Assessment Year [in short referred to 1. as ‘AY’] 2009-10 contest the order of Ld. Commissioner of Income-Tax (Appeals)-33, Mumbai, [in short referred to as ‘CIT(A)’], Appeal No. CIT(A)- 33/Rg.21/417/2015-16 dated 14/06/2018 qua deletion of penalty u/s Aparna A.Hendre Assessment Year-2009-10 271(1)(c) for Rs.42,296/- in respect of disallowance of Rs.68,640/- made in the quantum assessment order on account of bogus purchases. The stated penalty was imposed by Ld. Assessing Officer vide penalty order dated 20/08/2015 but the same was deleted by first appellate authority, finding merits in assessee’ submissions. Aggrieved, the revenue is in further appeal before us.

2.

The learned Authorized Representative for assessee, at the outset, raised a preliminary issue that the appeal is not maintainable since the quantum of penalty being contested by revenue is less than monetary limit of Rs. 50 Lacs as prescribed by CBDT in its recently issued Circular No.17/2019 dated 08/08/2019 [F.No.279/Misc.142/2007-TTJ(Pt.) Government of India, Ministry of Finance, Department of Revenue] and therefore, the appeal is liable to be dismissed. The Ld. DR submitted that penalty was levied on account of alleged bogus purchases as per information received from Sales Tax Department, Maharashtra and therefore, the appeal would be covered by exception given in the circular.

3.

Upon perusal of case records, prima facie, it appears that the tax effect of quantum of penalty being contested by the revenue is less than prescribed limit of Rs.50 Lacs and the same is covered by recently issued low tax effect Circular No.17/2019 dated 08/08/2019 issued by Central Board of Direct Taxes [CBDT]. This recent circular further enhances the monetary limit fixed in earlier Circular No.3 of 2018 dated 11/07/2018 issued by CBDT as amended on 20/08/2018. So far as the contentions raised by Ld. DR are concerned, we are of the considered opinion that Aparna A.Hendre Assessment Year-2009-10 quantum proceedings and penalty proceedings were separate proceedings and the circular would apply to each proceeding separately. No separate exception has been provided in any of the circular with respect to quantum of penalty. In view of the same, we dismiss the revenue’s appeal.

4.

At the same time, a liberty is given to revenue to seek recall of the appeal, if at a later stage, it is found that the matter is covered by any exceptions provided in any of the circular or in case the tax effect as agitated by revenue exceeds the prescribed monetary limit.

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