What did the Tribunal hold?

The Tribunal noted that the tax effect was below the prescribed limit. However, accepting the Revenue's request to withdraw the appeal, it was dismissed as infructuous, with liberty to file an application if conditions for contesting are met.

The Revenue filed an appeal against an order of the CIT(A) for AY 2008-09. The tax effect involved was less than Rs. 20,00,000/-, which is below the departmental threshold for appeals.

What were the issues?

Whether the appeal should be contested on merits despite a low tax effect, considering departmental instructions and recent modifications to circulars.

ACIT vs Shri Ram Rang, Meerut | ITAT Delhi 2018

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

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

For Appellant: Ms. Nidhi Srivastava, CIT(DR)

Hearing: 03.12.2018Pronounced: 03.12.2018

Appellant by Ms. Nidhi Srivastava, CIT(DR) Respondent by Sh. Anil Kumar Jain, CA Date of hearing 03.12.2018 Date of pronouncement 03.12.2018 ORDER PER O.P. KANT, A.M.: The present appeal has been filed by the Revenue against the order dated 11.01.2016 passed by CIT(A), Meerut, pertaining to the assessment year 2008-09. It has been identified by the Registry that the tax effect involved in the present appeal is less than Rs.20,00,000/-.

During the course of hearing, the Ld. CIT(DR) submitted that no doubt tax effect involved in the appeal is less than Rs.20 lakhs, thus, bound by the departmental instruction, the appeal has to be withdrawn. However, attention was invited to para 10 of the Circular No. 3/2018, dated 11th July, 2018, which has been modified by Circular dated 20th August, 2018 and in terms of the said modification the Departmental Representatives made a prayer that permission to pray for recall of the order may be granted in case any of the conditions in the reports made available by the A.O. subsequently, show that the issues were required to be contested. The modified para is extracted hereunder: “10. Adverse judgments relating to the following issues should be contested on merits notwithstanding that the tax effect entailed is 3 above or there is no tax effect: (a) Where the Constitutional validity of the provisions of an Act or Rule is under challenge, or (b) Where Board's order, Notification, Instruction or Circular has been held to be illegal or ultra vires, or (c) Where Revenue Audit objection in the case has been accepted by the Department, or (d) Where addition relates to undisclosed foreign income/undisclosed foreign assets (including financial assets)/ undisclosed foreign bank account. (e) Where addition is based on information received from external sources in the nature of law enforcement agencies such as CBI/ ED/ DRI/ SFIO/ Directorate General of GST Intelligence (DGGI). (f) Cases where prosecution has been filed by the Department and is pending in the Court. ”

Accepting the said request, the appeal is dismissed as infructuous. While so directing, it is made clear that the Department is at liberty to file Miscellaneous Application, if the tax effect is found to be more than the prescribed limit of Rs.20,00,000/- or any of the conditions etc., as available in the amendment carried out in para 10 of Circular No. 3/2018, dated 20.08.2018, is made out.

In the result, the appeal of the Revenue is dismissed. Order is pronounced in the open court on 3rd December, 2018.

ACIT, MEERUT vs. SHRI RAM RANG, MEERUT

What did the Tribunal hold?

What were the facts?

What were the issues?

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