DCIT, NEW DELHI vs. M/S ACME COMPUTERS LTD., NEW DELHI

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ITA 1727/DEL/2011Status: DisposedITAT Delhi23 March 2017AY 2005-063 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 Revenue's appeal was not maintainable as the tax effect was below the monetary limit prescribed by CBDT Circular No. 21/2015. Consequently, the assessee's cross-objection was rendered infructuous.

What were the facts?

The Revenue filed an appeal and the assessee filed a cross-objection against an order of the CIT(A). The Revenue's appeal concerned the deletion of an addition made under Section 68 regarding share application money.

What were the issues?

Whether the Revenue's appeal is maintainable in light of CBDT circulars regarding tax effect, and whether the assessment under Section 153C was valid and within limitation.

Which sections of the Income-tax Act were involved?

Section 68,Section 153C,Section 143(3),Section 153B

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “A”: NEW DELHI

Before: SHRI H.S. SIDHU & SHRI PRASHANT MAHARISHI

For Appellant: Adv Sumangla Saxena , Adv
For Respondent: DR Assessee by:, Adv Sumangla Saxena , Adv
Hearing: 01/03/2017Pronounced: 23/03/2017

Revenue by : Sh. SK Jain, DR Assessee by: Sh. Rajiv Saxena, Adv Sumangla Saxena , Adv Date of Hearing 01/03/2017 Date of pronouncement 23/03/2017 O R D E R PER PRASHANT MAHARISHI, A. M. 1. This is an appeal filed by the revenue and the cross objection filed by the assessee against of the ld CIT(A)-I, New Delhi dated 14.01.2011 for the Assessment Year 2005-06. 2. The revenue has raised the following grounds of appeal:- “1. The order of the ld CIT(Appeals) is not correct in law and facts.

2. In the facts and circumstances of the case the ld CIT(A) has erred in law and on facts in deleting the addition of Rs. 1500000/- made u/s 68 of the IT Act, 1961 by the Assessing Officer in respect of share application money introduced during the year.”

3. The assessee has raised the following grounds of appeal:- “1. That the assessment order passed under section 153C/ 143(3) is bad in law and required to be quashed.

Page 2 of 3 a) because the same is based on no incriminating material found during search on which any undisclosed income could be assessed. b) because assessment made u/s 153C is barred by limitation as it was required to be completed by 31.12.2008 as per section 153B of the Income Tax Act, 1961 while the same was completed on 24.12.2009.”

4.

At the outset of the hearing itself, the ld. AR brought to our attention that CBDT vide Circular No.21/2015 dated 10th December, 2015 has decided that the revenue would not prefer an appeal before the Tribunal if the tax effect is less than Rs.10 lakhs. Therefore, he pleaded that the appeal of the revenue be decided as per the instruction of the CBDT. Ld DR also confirmed the same facts.

5.

We have heard both the sides on the issue and perused the material. We find that the CBDT vide circular dated 10.12.2015 has revised the monetary limit for filing the appeal by the department before Income Tax Appellate Tribunal, Hon’ble High Courts and Hon’ble Supreme Court. The relevant para of the aforesaid circular is 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 :- Sl.No. Appeals in Income-tax Monetary Limit(in matters 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.”

6.

We find that the tax effect involves in these appeal of the Revenue is below Rs.10 lakhs. There is no dispute that the Board’s instructions 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 instruction since the tax effect in the instant appeal is less than the amount of Rs.10 lakhs.

5. In view of the above, Circular No.21 dated 10.12.2015 will apply to all pending appeals. Therefore the precedent, it is held that the appeal is not maintainable in the instant case as the tax effect is less than Rs.10 lakhs. Accordingly, it is held that appeal filed by the revenue is not maintainable.

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