DCIT, DEHRADUN vs. M/S. MIROS AS, DEHRADUN

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ITA 796/DEL/2015Status: DisposedITAT Delhi26 July 2018AY 2011-123 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 of the revenue deserved to be dismissed due to low tax effect as per CBDT Circular No. 3/2018. The circular was binding on tax authorities and applied retrospectively to pending appeals.

What were the facts?

The Revenue appealed against a DRP direction to apply a 10% deemed profit rate under Section 44BB, resulting in a deletion of Rs. 49,36,320/-. The quantum involved was less than Rs. 20 lacs.

What were the issues?

Whether the revenue's appeal is maintainable before the Tribunal given the low tax effect as per CBDT Circular No. 3/2018.

Which sections of the Income-tax Act were involved?

Section 44BB

AI-generated summary — verify with the full judgment below

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

Before: SHRI G.D. AGRAWAL & SHRI K.NARASIMHA CHARY

For Respondent: DR Assessee by Non e
Hearing: 26.07.2018Pronounced: 26.07.2018

ORDER PER SHRI K.NARASIMHA CHARY, JM Challenging the directions of the learned Dispute Resolution Panel-II, New Delhi (for short “Ld. DRP”) dated 14.04.2014, directing the learned Assessing Officer to apply the deemed profit rate of 10% under section 44BB of the Income Tax Act, 1961 (the Act) which resulted in deletion of Rs. 49,36,320/- from the amount proposed in the draft assessment order, Revenue preferred this appeal.

2.

At the outset, it is brought to our notice that the quantum involved in this case being less than Rs.20 lacs, squarely falls within the ambit of Circular No.3/2018 dated 11.07.2018 issued by the Central Board of Direct Taxes prescribing the tax effect for preferring appeals before Tribunal by the revenue.

3.

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. 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.

4.

In the result, Appeal is dismissed.

Order pronounced in the open court on 26th July 2018

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