The Commissioner of Income Tax - II vs. Shri Surender Kumar

1 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR. JUDGMENT (1) D.B. INCOME TAX APPEAL NO. 339/2008 COMMISSIONER OF INCOME TAX-I VS. M/S. ALPANA GEMS. WITH (2) D.B. INCOME TAX APPEAL NO. 75/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (3) D.B. INCOME TAX APPEAL NO. 197/2004 COMMISSIONER OF INCOME TAX-I VS. SHRI NARENDRA KUMAR LUNAWAT. WITH (4) D.B. INCOME TAX APPEAL NO. 34/2007 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SH. CHAMPALAL CHOUDHARY. WITH (5) D.B. INCOME TAX APPEAL NO. 43/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. BAL KISHAN SODHANI. WITH (6) D.B. INCOME TAX APPEAL NO. 44/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SHRI AJAY KUMAR JAIN. WITH (7) D.B. INCOME TAX APPEAL NO. 182/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SHRI RAJENDRA KASLIWAL. WITH (8) D.B. INCOME TAX APPEAL NO. 229/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. PANSARI GEMS INTERNATIONAL. WITH (9) D.B. INCOME TAX APPEAL NO. 239/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SHRI SANJAY KUMAR JAIN. WITH (10) D.B. INCOME TAX APPEAL NO. 247/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. NOWAL EXPORTS.

2 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS WITH (11) D.B. INCOME TAX APPEAL NO. 254/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SMT. NIRMALA AGARWAL. WITH (12) D.B. INCOME TAX APPEAL NO. 278/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SHRI GOVIND MODI. WITH (13) D.B. INCOME TAX APPEAL NO. 307/2008 COMMISSIONER OF INCOME TAX-I VS. M/S. AYAN FINTRADE (P) LTD. WITH (14) D.B. INCOME TAX APPEAL NO. 358/2008 COMMISSIONER OF INCOME TAX-I VS. BHAGWAN DAS GUPTA HUF. WITH (15) D.B. INCOME TAX APPEAL NO. 384/2008 COMMISSIONER OF INCOME TAX-I VS. BHAGWAN DAS GUPTA HUF. WITH (16) D.B. INCOME TAX APPEAL NO. 395/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. NAMAN EXPORTS. WITH (17) D.B. INCOME TAX APPEAL NO. 401/2008 COMMISSIONER OF INCOME TAX-I VS. SHRI BHAGWAN DAS GUPTA(HUF). WITH (18) D.B. INCOME TAX APPEAL NO. 579/2008 COMMISSIONER OF INCOME TAX-I VS. M/S. GOENKA EXPORTS LTD. WITH (19) D.B. INCOME TAX APPEAL NO. 617/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SH. OMKAR VIJAY. WITH (20) D.B. INCOME TAX APPEAL NO. 669/2008 COMMISSIONER OF INCOME TAX-I VS M/S. ALPANA GEMS. WITH (21) D.B. INCOME TAX APPEAL NO. 8/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SHRI RAJ KUMAR GOYAL. WITH

3 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS (22) D.B. INCOME TAX APPEAL NO. 11/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. ADITYA GEMS. WITH (23) D.B. INCOME TAX APPEAL NO. 16/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. VINOD INTERNATIONAL. WITH (24) D.B. INCOME TAX APPEAL NO. 17/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. S.L. EXPORTS. WITH (25) D.B. INCOME TAX APPEAL NO. 23/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. VINAYAK WOOD & IRON CRAFT. WITH (26) D.B. INCOME TAX APPEAL NO. 51/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (27) D.B. INCOME TAX APPEAL NO. 52/2009 COMMISSIONER OF INCOME TAX-I VS SHRI RAMESH CHAND MAHESHWARI. WITH (28) D.B. INCOME TAX APPEAL NO. 55/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAMESH CHAND MAHESHWARI. WITH (29) D.B. INCOME TAX APPEAL NO. 56/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (30) D.B. INCOME TAX APPEAL NO. 58/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (31) D.B. INCOME TAX APPEAL NO. 59/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAKESH R. PUROHIT. WITH (32) D.B. INCOME TAX APPEAL NO. 60/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAMESH CHAND MAHESHWARI. WITH

4 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS (33) D.B. INCOME TAX APPEAL NO. 70/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAKESH R. PUROHIT. WITH (34) D.B. INCOME TAX APPEAL NO. 71/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAKESH R. PUROHIT. WITH (35) D.B. INCOME TAX APPEAL NO. 73/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAMESH CHAND MAHESHWARI. WITH (36) D.B. INCOME TAX APPEAL NO. 74/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (37) D.B. INCOME TAX APPEAL NO. 76/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (38) D.B. INCOME TAX APPEAL NO. 80/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAMESH CHAND MAHESHWARI. WITH (39) D.B. INCOME TAX APPEAL NO. 81/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. SUBHLAXMI EXPORTS. WITH (40) D.B. INCOME TAX APPEAL NO. 83/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SMT. BELA JAIN. WITH (41) D.B. INCOME TAX APPEAL NO. 88/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAMESH CHAND MAHESHWARI. WITH (42) D.B. INCOME TAX APPEAL NO. 90/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAKESH R. PUROHIT. WITH (43) D.B. INCOME TAX APPEAL NO. 91/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAMESH CHAND MAHESHWARI. WITH (44) D.B. INCOME TAX APPEAL NO. 95/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA.

5 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS WITH (45) D.B. INCOME TAX APPEAL NO. 96/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (46) D.B. INCOME TAX APPEAL NO. 105/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAMESH CHAND MAHESHWARI. WITH (47) D.B. INCOME TAX APPEAL NO. 106/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (48) D.B. INCOME TAX APPEAL NO. 128/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (49) D.B. INCOME TAX APPEAL NO. 129/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (50) D.B. INCOME TAX APPEAL NO. 130/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (51) D.B. INCOME TAX APPEAL NO. 133/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAKESH R. PUROHIT. WITH (52) D.B. INCOME TAX APPEAL NO. 134/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI MAN MOHAN KRISHAN BAGLA. WITH (53) D.B. INCOME TAX APPEAL NO. 135/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAMESH CHAND MAHESHWARI. WITH (54) D.B. INCOME TAX APPEAL NO. 152/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI VIKASH AGRAWAL. WITH (55) D.B. INCOME TAX APPEAL NO. 208/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAJENDRA KUMAR AGRAWAL. WITH

6 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS (56) D.B. INCOME TAX APPEAL NO. 272/2009 COMMISSIONER OF INCOME TAX-I VS. M/S. S.G. GEMS & JEWELLERY. WITH (57) D.B. INCOME TAX APPEAL NO. 293/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI VINAY KUMAR SOGANI. WITH (58) D.B. INCOME TAX APPEAL NO. 343/2009 COMMISSIONER OF INCOME TAX-I VS. SHRI RAMESH CHAND MAHESHWARI. WITH (59) D.B. INCOME TAX APPEAL NO. 363/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SHRI SHIV BIHARI SHARMA. WITH (60) D.B. INCOME TAX APPEAL NO. 467/2009 COMMISSIONER OF INCOME TAX-I VS. M/S. SUMATI GEMS. WITH (61) D.B. INCOME TAX APPEAL NO. 480/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. UMESH SABOO. WITH (62) D.B. INCOME TAX APPEAL NO. 643/2009 COMMISSIONER OF INCOME TAX-I VS. JITENDRA KUMAR NIGAM. WITH (63) D.B. INCOME TAX APPEAL NO. 83/2010 COMMISSIONER OF INCOME TAX VS. SHRI MAHESH KUMAR SHARMA. WITH (64) D.B. INCOME TAX APPEAL NO. 84/2010 COMMISSIONER OF INCOME TAX VS. SHRI MAHESH KUMAR SHARMA. WITH (65) D.B. INCOME TAX APPEAL NO. 91/2010 COMMISSIONER OF INCOME TAX VS. SHRI MAHESH KUMAR SHARMA. WITH (66) D.B. INCOME TAX APPEAL NO. 92/2010 COMMISSIONER OF INCOME TAX VS. SHRI MAHESH KUMAR SHARMA.

7 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS WITH (67) D.B. INCOME TAX APPEAL NO. 104/2010 COMMISSIONER OF INCOME TAX VS. SHRI MAHESH KUMAR SHARMA. WITH (68) D.B. INCOME TAX APPEAL NO. 114/2010 COMMISSIONER OF INCOME TAX-I VS. JITENDRA KUMAR NIGAM. WITH (69) D.B. INCOME TAX APPEAL NO. 189/2010 COMMISSIONER OF INCOME TAX-I VS. SHRI RAKESH R. PUROHIT. WITH (70) D.B. INCOME TAX APPEAL NO. 190/2010 COMMISSIONER OF INCOME TAX-I VS. RAKESH R. PUROHIT. WITH (71) D.B. INCOME TAX APPEAL NO. 265/2010 COMMISSIONER OF INCOME TAX-I VS. SHRI JITENDRA KUMAR NIGAM. WITH (72) D.B. CROSS OBJECTIONS NO. 23/2011 IN D.B. INCOME TAX APPEAL NO. 363/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SHRI SHIV BIHARI SHARMA. WITH (73) D.B. INCOME TAX APPEAL NO. 59/2011 COMMISSIONER OF INCOME TAX-I VS. SHRI O.P. GHIYA. WITH (74) D.B. INCOME TAX APPEAL NO. 60/2011 COMMISSIONER OF INCOME TAX-I VS. SHRI O.P. GHIYA. WITH (75) D.B. INCOME TAX APPEAL NO. 143/2011 COMMISSIONER OF INCOME TAX-III VS. SHRI MAHESH KHANDELWAL. WITH (76) D.B. INCOME TAX APPEAL NO. 181/2011 COMMISSIONER OF INCOME TAX-I VS. M/S. SILVER GALLERY. WITH (77) D.B. INCOME TAX APPEAL NO. 225/2011 COMMISSIONER OF INCOME TAX-I VS. K.L. TAMBI & CO. WITH (78) D.B. INCOME TAX APPEAL NO. 227/2011 COMMISSIONER OF INCOME TAX-I VS. SMT. ANSHU JAIN.

8 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS WITH (79) D.B. INCOME TAX APPEAL NO. 236/2011 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. UMESH SABOO. WITH (80) D.B. INCOME TAX APPEAL NO. 315/2011 COMMISSIONER OF INCOME TAX-I VS. SMT. MAMTA SOGANI. WITH (81) D.B. INCOME TAX APPEAL NO. 316/2011 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. NAMAN GEMS (P) LTD. WITH (82) D.B. INCOME TAX APPEAL NO. 373/2011 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. UMESH SABOO. WITH (83) D.B. INCOME TAX APPEAL NO. 374/2011 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. SMT. SUDHA SHARMA. WITH (84) D.B. INCOME TAX APPEAL NO. 376/2011 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. NAMAN GEMS (P) LIMITED. WITH (85) D.B. INCOME TAX APPEAL NO. 381/2011 COMMISSIONER OF INCOME TAX VS, M/S. BHURAMAL RAJMAL SURANA. WITH (86) D.B. INCOME TAX APPEAL NO. 554/2011 COMMISSIONER OF INCOME TAX-I VS. SHRI O.P. GHIYA(SINCE DECEASED) THROUGH LEGAL HEIRS. WITH (87) D.B. INCOME TAX APPEAL NO. 570/2011 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. NAMAN GEMS (P) LTD. WITH (88) D.B. INCOME TAX APPEAL NO. 591/2011 COMMISSIONER OF INCOME TAX VS. M/S. GUPTA JEWELS CORPN. WITH (89) D.B. INCOME TAX APPEAL NO. 612/2011 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. UMESH SABOO.

9 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS WITH (90) D.B. INCOME TAX APPEAL NO. 628/2011 COMMISSIONER OF INCOME TAX VS. SMT. MAMTA SOGANI. WITH (91) D.B. INCOME TAX APPEAL NO. 334/2009 COMMISSIONER OF INCOME TAX-I VS. M/S. BHANSALI TRADING CORPN. WITH (92) D.B. INCOME TAX APPEAL NO. 15/2009 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. AARAV INTERNATIONAL. WITH (93) D.B. INCOME TAX APPEAL NO. 456/2009 COMMISSIONER OF INCOME TAX-I VS. M/S. EURO JEWELS. WITH (94) D.B. INCOME TAX APPEAL NO. 220/2011 COMMISSIONER OF INCOME TAX-I VS. M/S. DHADDA EXPORTS. WITH (95) D.B. INCOME TAX APPEAL NO. 284/2011 COMMISSIONER OF INCOME TAX-I VS. M/S. DHADDA EXPORTS. WITH (96) D.B. INCOME TAX APPEAL NO. 311/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. M/S. HASTAKALA C-SCHEME, JAIPUR. WITH (97) D.B. INCOME TAX APPEAL NO. 698/2008 COMMISSIONER OF INCOME TAX, JAIPUR-II VS. SHRI RAJIV ARORA. WITH (98) D.B. INCOME TAX APPEAL NO. 76/2011 COMMISSIONER OF INCOME TAX, JAIPUR-III, VS. M/S. J.K. JEWELERS INTERNATIONAL. WITH (99) D.B. INCOME TAX APPEAL NO. 46/2012 COMMISSIONER OF INCOME TAX-I VS. M/S. ASHISH HANDICRAFT ENTERPRISES. DATE OF JUDGMENT : 13.07.2016

10 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS HON'BLE MR. JUSTICE MOHAMMAD RAFIQ HON'BLE MR. JUSTICE DINESH CHANDRA SOMANI Mr. Anuroop Singhi with Mr. O.P. Pareek, Mr. R.B. Mathur, Mr. Sameer Jain, for the appellants. Mr. R.C. Shah, Mr. Naresh Gupta, Mr. Sanjay Jhanwar, Mr. Ajay Gupta, Mr. T.C. Jain, Mr. N.L. Agrawal, Mr. Sudesh Bansal, Mr. Gunjan Pathak, Mr. Vivek Singhal, Dr. S.L. Jain, Mr. P.K. Kasliwal, Mr. Mahendra Gargieya, Mr. Anant Kasliwal, Mr. R.K. Yadav, Mr. Siddharth Ranka, for the respondents. BY THE COURT(PER

HON'BLE MOHAMMAD RAFIQ, J.)

: All these appeals are directed against order of the Income Tax Appellate Tribunal and indisputably, the tax effect in all of them, as brought to our notice, is less than Rs.20 lac. The Central Board of Direct Taxes, in exercise of its power u/sec. 268A (1) of the Income-tax Act 1961 in supersession of the Boards instruction No.5/2014 dt.10.7.2014, issued Circular No. 21/2015 dated 10.12.2015 providing the monetary limits for filing appeals by the Revenue before the Tribunal, High Courts and Apex Court with an object to reduce litigation. Relevant para nos.3, 8, 9 and 10 reads as under:- “3. Henceforth, appeals/SLPs shall not be filed in cases where the tax effect does not exceed the monetary limits given hereunder :-

11 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS S. No. Appeals in Income-tax matters Monetary Limit (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. 4. xxx xxx xxx 5. xxx xxx xxx 6. xxx xxx xxx 7. xxx xxx xxx 8. Adverse judgments relating to the following issues should be contested on merits notwithstanding that the tax effect entailed is less than the monetary limits specified in para 3 above or there is no tax effect: (a) Where the Constitutional validity of the provisions of an Act or Rule are under challenge, or (b) Where Board's order, Notification, Instruction or Circular has been held to be illegal or ultra vires, or (c) Where Revenue Audit objection in the case has been accepted by the Department, or (d) Where the addition relates to undisclosed foreign assets/bank accounts. 9. The monetary limits specified in para 3 above shall not apply to writ matters and direct tax matters other than Income tax. Filing of appeals in other Direct tax matters shall continue to be governed by relevant provisions of statute & rules. Further, filing of appeal in cases of Income Tax, where the tax effect is not quantifiable or not involved, such as the case of registration of trusts or institutions under section 12 A of the IT Act, 1961, shall not be governed by the limits specified in para 3 above and decision to file

12 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS appeal in such cases may be taken on merits of a particular case. 10. 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.” The extract of the paragraphs referred to supra, clearly indicates that limits specified in para 3 may not apply to certain exceptions specified in para 8. Para nos.9 and 10 of the Circular if read conjointly, clearly envisage that the present instructions will apply retrospectively to all the pending appeals and appeals to be filed henceforth in High Courts/Tribunals, subject to certain exceptions, where the tax effect even if is less than Rs.20 lac, can be preferred in High Courts. Taking note of the CBDT Circular dt. 10/12/2015 and considering that in all these matters tax effect being less than what has been prescribed for filing appeal before the High Courts, the Revenue has chosen not to press them. It is, however, made clear that the substantial questions of law raised in the instant appeals, if any, are left open to be examined in an appropriate proceeding, if arises in future. At

13 D.B. INCOME TAX APPAEL NO. 339/2008 & OTHER CONNECTED APPEALS the same time, we deem it appropriate to observe that if any of these appeals falls in any of the exceptions as referred to in the Circular dt. 10/12/2015, the Revenue will be at liberty to move an application for revival thereof if so advised. Accordingly, in the light of the CBDT Circular dated 10.12.2015, the appeals stand dismissed as not pressed. Consequently, D.B. Cross Objections NO. 23/2011 also stands dismissed as not pressed. All the interim applications pending in these appeals also stands disposed off. Office is directed to place a copy of this judgment on record of each file.

(DINESH CHANDRA SOMANI),J. (MOHAMMAD RAFIQ),J.

Manoj.