DCIT 7(2), MUMBAI vs. SONIC BIOCHEM EXTRACTIONS LTD, MUMBAI

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ITA 3868/MUM/2014Status: DisposedITAT Mumbai27 April 2017AY 2010-113 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 covered by the CBDT's Low Tax Effect circular. The tax effect of the disputed amount was below the prescribed limit for filing appeals before the ITAT.

What were the facts?

The Revenue appealed against the CIT(A)'s order which granted relief to the assessee on certain disallowances. The assessee was engaged in manufacturing soya products and faced disallowances under Section 40(a)(ia), shortage-in-transit, and TDS reconciliation.

What were the issues?

Whether the Revenue's appeal is maintainable based on the monetary limit prescribed by the CBDT's Low Tax Effect circular.

Which sections of the Income-tax Act were involved?

Section 40(a)(ia)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “E” BENCH, MUMBAI

Before: SHRI SAKTIJIT DEY, JM & SHRI MANOJ KUMAR AGGARWAL, AM

For Appellant: Dr. A.K.Nayak, Ld. DR
For Respondent: Dr. A.K.Nayak, Ld. DR

Per Manoj Kumar Aggarwal (Accountant Member)

1.

The captioned appeal by Revenue for Assessment Year [AY] 2010-11 assails the order of Ld. Commissioner of Income Tax (Appeals)-13, [CIT(A)], Mumbai dated 18/03/2014 qua certain relief provided to the assessee against various disallowances made by the Assessing Officer [AO].

2.

Briefly stated, the assessee, being resident corporate assessee, was subjected to an assessment u/s 143(3) vide Assessing Officer [AO] order dated 03/01/2013 wherein the total income of the assessee was determined at Rs.4,44,43,520/- after certain adjustments/disallowances as against returned income of Rs.4,05,78,550/- filed by the assessee on 20/09/2010. The assessee was engaged in the business of manufacturing of soya flour, chunks and lecithin etc. The assessee suffered, inter-alia, disallowance u/s 40(a)(ia) for Rs.14,62,312/-, disallowance against shortage-in-transit for Rs.7 Lacs & disallowance of Rs.5,63,244/- on account of reconciliation of TDS credit. All these additions were contested with partial success before Ld. CIT(A) vide order dated 18/03/2014 wherein the Ld. CIT(A) after considering the various contentions deleted 40(a)(ia) disallowance, TDS reconciliation disallowance of Rs.5,63,244/- and restricted the adhoc disallowance against shortage- in-transit expenses to Rs. 2.50 Lacs. Aggrieved by the relief provided by Ld. CIT(A), the revenue is in appeal before us. 3. At the outset, it has been brought to our notice that the appeal, being revenue’s appeal, is covered by the Low Tax Effect circular issued by the CBDT. As per calculations, it is seen that the tax effect of amount in dispute in the appeal is below Rs.10 Lacs and hence the same is covered by latest CBDT Circular number 21 of 2015 dated 10/12/2015. As per this circular, new guidelines of monetary limit for filing of appeals by the Department has been issued, whereby the tax effect for filing of appeal before the ITAT has been prescribed at minimum of Rs. 10 lakhs. In the said Circular, it has been specifically clarified that the said instruction will apply retrospectively to all the Sonic Biochem Extractions Limited Assessment Year: 2010-11 pending appeals. The Ld. DR fairly conceded the position and could not point out any exceptions as given in the circular. Accordingly, the appeal filed by the revenue is not maintainable and therefore, dismissed in limine. 4. In Nutshell, the appeal of the revenue stands dismissed.

Order pronounced in the open court on 27th April, 2017.

Sd/- Sd/- (Saktijit Dey) (Manoj Kumar Aggarwal) �ाियक सद� / Judicial Member लेखा सद� / Accountant Member मुंबई Mumbai; िदनांक Dated : 27.04.2017 Sr.PS:- Thirumalesh आदेश की �ितिलिप अ�ेिषत/Copy of the Order forwarded to : अपीलाथ� / The Appellant 1. ��थ� / The Respondent 2. आयकर आयु�(अपील) / The CIT(A) 3. आयकर आयु� / CIT – concerned 4. िवभागीय �ितिनिध, आयकर अपीलीय अिधकरण, मुंबई / DR, ITAT, 5. Mumbai गाड� फाईल / Guard File 6.

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