ITO 26(2)(5), MUMBAI vs. RIZWAN REHAN MALIK, MUMBAI

Aggrieved by the order of Ld. CIT (Appeals), the revenue has preferred this appeal before the Tribunal on the following effective grounds:-

On the facts and in the circumstances of the case and in law, the Ld. CIT (A) erred in ignoring the fact that the assessee had incurred total cash expenses amounting to Rs. 56,38,196 during the year, including rent expenses of Rs. 42,00,000/- whereas cash withdrawals from banks were to the tune of Rs. 35,33,412/- only which corroborates the fact that the assessee had claimed bogus rent expenses to the tune of Rs. 18,11,579/- (cash expenses of Rs. 56,38,196 (less) cash withdrawal Rs. 35,33,412/- (less) cash in hand as on 31.03.2009 Rs. 2,93,205).”

On the facts and in the circumstances of the case and in law, the Ld. CIT (A) failed to appreciate that the AO had issued notices u/s 133(6) to all the 40 parties to verify the genuineness of rent expenses claimed, however, the notices could not be served on any of the 40 parties and the assessee also expressed his inability to produce these parties alongwith their copy of return, ledger account, bills raised and copy of bank statements.

On the facts and in the circumstances of the case and in law, the Ld. CIT (A) erred in ignoring the fact that neither books of accounts nor supporting documentary evidences were furnished by the assessee to discharge the onus cast on him in terms of provisions of section 37(1) of the I.T. Act, 1961.”

This case was fixed for today for hearing. However, when the case was called out for hearing, none appeared on behalf of the respondent/assessee. We notice that the tax effect of the relief granted by the Ld. Commissioner of Income Tax (Appeals) is below Rs.20 lacs and as per the CBDT Circular No. 3/2018, F. No. 279/Misc.142/2007-ITJ (Pt) dated 11th July, 2018 issued by Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, Assessment Year: 2009-10

The Ld. Departmental Representative (DR) fairly conceded that this appeal is not maintainable in light of the above said CBDT Circular. The Ld. DR also did not point out that this appeal falls in any of the exceptions carved out in the above said circular.

We have gone through the order of the Ld. Commissioner of Income Tax (Appeals) and the grounds of appeals. We find that the tax effect in the above referred appeal is less than Rs. 20 lacs. Accordingly, we dismiss the aforesaid appeal filed by the Revenue. In the result, the appeal by the Revenue is dismissed.