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Income Tax Appellate Tribunal, DELHI BENCH ‘G’, NEW DELHI
Before: SHRI H.S. SIDHU & SHRI ANADEE NATH MISSHRA
ORDER PER H.S. SIDHU, J.M.
The appeal has been filed by the Department and the Cross Objection filed by the Assessee against the Order of the Ld. CIT(A)-XXVII, New Delhi dated 09.03.2010 relating to assessment year 2007-08.
The Revenue has raised the following grounds in its Appeal No. 2127/Del/2010:-
“1. On the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs. 22,50,000/- made by the AO u/s. 68 of the I.T. Act.
2. On the facts and circumstances of the case, the Ld. CIT(A) has erred in deleting the addition of Rs. 10,36,000/- made by the AO u/s. 40A(2) of the I.T. Act being payment to persons specified u/s. 40A(2)(b) of the I.T. Act.
3. The appellant craves leave for reserving the right to amend, modify, alter, add or forego any ground(s) of appeal at any time before or during the hearing of this appeal.
The assessee has raised the following grounds in its Cross Objection:-
“1. The Ld. CIT(A) has erred in law and on facts in restricting the disallowance @10% out of conveyance expenses, interest on car loan and depreciation on car, amounting to Rs. 18,063/-. The disallowance made by the AO, out of conveyance expenses, interest on car loan and depreciation on car, at Rs. 36,126/- ought to had been deleted in full.
2. The Ld. CIT(A) had erred in law and on facts in restricting the disallowance @10% out of telephone expenses, amounting to Rs. 2,716/-. The disallowance made by the Ld. AO out of telephone expenses, at Rs. 5,431/- out to had been deleted in full.
3. That the Ld. CIT(A) had erred in law and on facts in not holding that the interest u/s. 234B of the I.T. Act, 1961 is illegal. The Ld. CIT(A) had failed to appreciate the submissions made as well as the case laws relied upon by the assessee apropos charging of interest u/s. 234B. The Ld. CIT(A) had simply mentioned that the charging of interest is, however, consequential in nature and is to be charged, if any, as per the provisions of the Act.”
We have heard both the parties and perused the material on record. At the time of hearing, Ld. Counsel of the assessee has filed a Chart containing the following details:-
“Swarn Sakhuja (AY 2007-08)
Total additions involved in Revenue’s Appeal Rs. 22,50,000/- Rs. 10,36,000/- Rs. 32,86,000/- Tax @30% on Rs. 32,86,000/- = Rs. 9,85,800/-“ 4.1 After perusing the records as well as the aforesaid Chart, we are of the considered opinion that the tax effect in the Revenue’s Appeal is less than Rs.10,00,000/-, therefore, the Department’s Appeal is not maintainable, in view of the Circular No. 21/2015 dated 10th December, 2015 issued vide F.No. 279/Misc. 142/2007-ITJ (Pt.) by the CBDT. For the sake of convenience, the relevant para nos. 3 & 10 of the aforesaid CBDT’s Circular are reproduced as under:-
“3. Henceforth, appeals/ SLPs shall not be filed in cases where the tax effect does not exceed the monetary limits given hereunder: Monetary Limit S No Appeals in Income-tax matters (in Rs) 1 Before Appellate Tribunal 10,00,000/- 2 Before High Court 20,00,000/- 3 Before Supreme Court 25,00,000/- It is clarified that an appeal should not be filed merely because the tax effect in a case exceeds the monetary limits prescribed above. Filing of appeal in such cases is to be decided on merits of the case.
This instruction will apply retrospectively to pending appeals and appeals to be filed henceforth in High Courts/ Tribunals. Pending appeals below the specified tax limits in para 3 above may be withdrawn/ not pressed. Appeals before the Supreme Court will be governed by the instructions on this subject, operative at the time when such appeal was filed.”
It is not in dispute that the Board’s instruction or directions issued to the income-tax authorities are binding on those authorities, therefore, the Department should have withdrawn/ not pressed the present Appeal, in view of the aforesaid instructions since the tax effect in the instant Appeal is less than the amount of Rs. 10 lacs, prescribed in the above said CBDT’s Instructions.
Keeping in view the CBDT Instruction No. 21/2015 dated 10th December, 2015, we are of the view that the Revenue should have withdrawn/ not pressed the instant appeal before the Tribunal. We are also of the view that the said Instructions are applicable for the pending appeals and appeals to be filed henceforth in Tribunal. Accordingly, the Revenue’s Appeal is dismissed. 7. As regards the Assessee’s Cross Objection is concerned, since we have already dismissed the Revenue’s Appeal on account of low tax effect, hence the Assessee’s Cross Objection has become infructuous and the same is dismissed as such. 8. In the result, Appeal filed by the Revenue as well as Cross Objection filed by the Assessee Stand dismissed.
Order pronounced in the Open Court on 25/04/2017.