ITO 3(3)(1), MUMBAI vs. RADHEY PROPERTIES P. LTD, MUMBAI

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ITA 3176/MUM/2017Status: DisposedITAT Mumbai06 October 2017AY 2009-103 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 tax effect, excluding surcharge and education cess, was below the monetary limit specified in the CBDT circular. Therefore, the appeal was not maintainable.

What were the facts?

The Revenue appealed against the CIT(A)'s deletion of additions made under Section 68 for share application money. The assessee argued that the tax effect was below the monetary limit for appeals as per CBDT circular.

What were the issues?

Whether the appeal filed by the Revenue is maintainable before the Tribunal considering the tax effect and the CBDT circular. Whether the CIT(A) was justified in deleting the addition made under Section 68.

Which sections of the Income-tax Act were involved?

Section 68,Section 143(3),Section 147

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCH “SMC”, MUMBAI

Before: SHRI G.S.PANNU

For Appellant: Ms. M.Hema Latha
For Respondent: Shri Rajesh S. Shah
Hearing: 12/07/2017Pronounced: 06/10/2017

ORDER The captioned appeal filed by the Revenue pertaining to assessment year 2009-10 is directed against an order passed by CIT(A)-8, Mumbai dated 31/01/2017, which in turn, arises out of an order passed by the Assessing Officer under section 143(3) r.w.s. 147 of the Income Tax Act, 1961 (in short ‘the Act’) dated 11/02/2016.

2.

In this appeal, Revenue has raised the following Ground of appeal:-

1. Whether on the facts and circumstances of the case and in law, the Ld.CIT(A) was right in deleting the addition of Rs.33,00,000 made u/s.68 of the I.T.Act, 1961 on account of receipt of share application money without appreciating the fact that the assessee had failed to establish the genuineness and creditworthiness of the investment made by the share applicants, 2. Whether on the facts and circumstances of the case and in law, the Ld.CIT(A) was right in deleting the addition of Rs.31,50,000/- made u/s.68 of the I.T.Act, 1961 on account of receipt of share application money without appreciating the fact that specific information was received from DGIT(Inv.), Mumbai that the alleged parties belonging to Praveen Kumar Jain group had confessed to providing accommodation entries without conducting any business activity and that the assessee was one of the beneficiary of such accommodation entries.

3.

At the time of hearing, the Ld. Representative for the assessee pointed out that the tax effect involved in this appeal is less than Rs.10.00 lacs as prescribed in the CBDT Circular No.21/2015 dated 10/12/2015, which has revised the monetary limits for filing of appeals by the Department before the Tribunal retrospectively. The Ld. Departmental Representative has not disputed the aforesaid fact-situation.

4.

Notably, in the instant case, the Assessing Officer made a disallowance under section 68 of the Act of Rs.33,00,000/- and the CIT(A) has deleted the disallowance made by the Assessing Officer. The tax effect on this disputed income comes to Rs.9,90,000/- excluding the surcharge and education cess. Our Co-ordinate Bench in the case of DCIT vs. M/s. Dome Bell Electronics India Ltd., in dated 22/07/2016 has held that for the purposes of considering the amount of tax effect as envisaged in CBDT Circular dated 10/12/2015 (supra), what has to be considered is the amount of tax excluding the amount of surcharge and education cess. Therefore, in this view of the matter, the tax effect in dispute in the captioned appeal is stated to be below the monetary limit of Rs.10.00 lacs specified in the CBDT Circular dated 10/12/2015 (supra), the same is dismissed as not maintainable.

5.

In the result, appeal of the Revenue is dismissed.

Order pronounced in the open court on 06/10/2017

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