DCIT CEN CIR 36, MUMBAI vs. CAPRIHANS INDIA LTD, MUMBAI

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ITA 4574/MUM/2011Status: DisposedITAT Mumbai01 October 2019AY 2006-073 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 agreed with the contention of the Departmental Representative that the appeals involved a tax effect below the prescribed monetary limit. The Tribunal granted liberty to the Revenue to point out any exceptions to this rule.

What were the facts?

The Revenue filed appeals before the ITAT against the orders of the CIT(A) for assessment years 2006-07 and 2007-08. The appeals were filed by the Revenue but the tax effect involved was below the enhanced monetary limit set by the CBDT for filing appeals.

What were the issues?

The primary issue was whether the appeals filed by the Revenue were maintainable given the tax effect was below the monetary limit specified by CBDT circulars for filing appeals before the ITAT.

Which sections of the Income-tax Act were involved?

Section 143(3),Section 153C

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “C” MUMBAI

Before: SHRI PRAMOD KUMAR & SHRI RAVISH SOOD

For Appellant: Mr. R. Murlidhar, A.R
For Respondent: Mr. Awungshi Gimson, CIT, D.R, Mr. R. Murlidhar, A.R
Hearing: 01/10/2019Pronounced: 01/10/2019

ORDER

PER RAVISH SOOD, JM

1.

The captioned appeals filed by the revenue are directed against the order passed by the Commissioner of Income Tax (Appeals)-41, Mumbai [in short „CIT(A)‟], which in turns arises from the respective assessment orders passed under section 143(3)/153C of the Income Tax Act 1961, (the „Act‟).

2.

Central Board of Direct Taxes (CBDT) vide Circular No. 17/2019 dated 08.08.2019 has amended Circular No. 3/2018 dated 11.07.2018 for further enhancement of monetary limit for filing of appeals by the Department before the ITAT, High Courts and SLPs/Appeals before Supreme Court as measures for reducing litigation.

3.

CBDT vide Circular No. 3/2018 dated 11.07.2018 has specified that appeals shall not be filed before the Income Tax Appellate Tribunal (ITAT) in cases where the tax effect does not exceed the monetary limit of Rs.20,00,000/-. For this purpose, „tax effect‟ means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of issues against which appeal is intended to be filed.

P a g e | 2 & 4575/Mum/2011 AYs. 2006-07 and 2007-08 The Asstt. Commissioner of Income Tax,CC-36 Vs. M/s Caprihans India Ltd. Further, „tax effect‟ shall be taxes including applicable surcharge and cess. However, the tax will not include any interest thereon, except where chargeability of interest itself is in dispute. In case the chargeability of interest is the issue under dispute, the amount of interest shall be the tax effect. In cases where returned loss is reduced or assessed as income, the tax effect would include notional tax on disputed additions. In case of penalty order, the tax effect will mean quantum of penalty deleted or reduced in the order to be appealed against.

At para 13 of the above Circular, it has been mentioned that:

“13. This Circular will apply to SLPs/appeals/cross objection/references to be filed henceforth in SC/HCs/Tribunal and it shall also apply retrospectively to pending SLPs/appeals/cross objections/references. Pending appeals below the specified tax limits in para 3 above may be withdrawn/not pressed.”

4.

As a step towards further management of litigation, CBDT vide Circular No. 17/2019 has fixed the monetary limit for filing of appeals before ITAT at Rs.50,00,000/-.

5.

In the instant appeal filed by the Department, the tax effect involved is below the monetary limit of Rs.50,00,000/-. The same was brought to the notice of the Ld. Departmental Representative (DR).

6.

Before us, the Ld. DR submits that liberty may kindly be given to raise, after necessary further verification, and to seek recall the dismissal of appeal and restoration of the appeal in case it can be shown that the appeal is covered by the exceptions.

7.

We agree with the above contentions of the Ld. DR and make it clear that the appellant shall be at liberty to point out the exceptions and we will take appropriate remedial measures in this regard.

8.

With the above observations, both the aforesaid appeals involving tax effect of less than Rs.50,00,000/- are dismissed.

Order pronounced in the open Court on 01/10/2019.

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