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Income Tax Appellate Tribunal, DELHI BENCH ‘E’ : NEW DELHI
Before: SHRI R.S.SYAL, HON’BLE & SHRI LALIET KUMAR
PER LALIET KUMAR, JUDICIAL MEMBER :
The present appeal is filed by the revenue challenged the assessee on the following grounds :- “
1. Whether on the facts and circumstances of the case and in law the Ld. CIT(A) has erred in deleting the addition of Rs. 35,49,267/- made by the AO on account of disallowance u/s 14A of the Income Tax Act, 1961 (the Act) read with Rule 8D of the Income Tax Rules, 1962 (the Rules)?
2. Whether on the facts and circumstances of the case and in law the Ld. CIT(A) is justified in deleting addition of Rs. 35,49,267/- made by the AO under clause (ii) and (iii) of Rules 8D2 of the Rules without considering a fact that interest expenditure of Rs. 21,03,16,800/- during the year under consideration was not directly attributable to any particular income and receipts? 3. Whether on the facts and circumstances of the case and in law the Ld. CIT(A) is justified in not invoking clause (ii) of Rule 8D2 of the Rules even when the assessee did not furnish any evidence to support a self serving claim that interest bearing funds were not used in making investment in shares? 4. That the order of the Ld. CIT(A) is erroneous and is not tenable on facts and in law.”
As per the CBDT Circular No.3/2018 dated 11th July, 2018 2. vide which the Revenue has been directed not to prefer any appeal in case the tax effect is less than Rs.20,00,000/- and this factual position has been fairly conceded by the Ld. D.R. The Ld. A.R. contended that the appeal of the Revenue may be dismissed in the light of CBDT Circular (supra).
After perusing the materials available on record, we find that the amount disputed before us is below the tax effect limit prescribed by CBDT vide Circular No. 3/2018 dated 11.07.2018 for preferring appeals before tribunal by the revenue. On perusal of the Circular No. 3/2018 dated 11.07.2018 and the materials available on record, Ld. Sr. DR could not point out as to how and why such a Circular is not applicable to the facts of the case. We also find that the Circular makes it very clear that the revised monetary limits shall apply retrospectively to pending appeals also. We find that the Circular is binding on the tax authorities. Hence, we hold that the appeal of the revenue deserves to be dismissed in terms of low tax effect vide Circular No. 3/2018 dated 11.07.2018. Accordingly, this being a low tax effect case, we dismiss this appeal of revenue in limine, as unadmitted, without going into the merits of the case.
In the result, appeal of the revenue is dismissed. Order pronounced in open court on this 09th October, 2018.