What did the Tribunal hold?

The Tribunal held that Circular No. 21/2015, which sets a monetary limit for filing appeals, was applicable. Therefore, the appeals filed by the Revenue were dismissed.

The Revenue filed appeals against the CIT(A)'s order for AYs 2003-04 & 2004-05. The tax effect involved in the appeals was below Rs. 10 lakhs.

What were the issues?

The primary issue was the applicability of CBDT Circular No. 21/2015 regarding the monetary limit for filing appeals before the Tribunal.

ITO vs Smt. Sharadamma | ITAT Bangalore 2016

Income Tax Appellate Tribunal, BANGALORE BENCH A, BANGALORE

Before: SHRI. ABRAHAM P. GEORGE & SHRI. VIJAYPAL RAO

ITA.1034 & 1103/Bang/2015 CO.203 & 204/Bang/2015 Page - 1 IN THE INCOME TAX APPELLATE TRIBUNAL BANGALORE BENCH 'A', BANGALORE BEFORE SHRI. ABRAHAM P. GEORGE, ACCOUNTANT MEMBER AND SHRI. VIJAYPAL RAO, JUDICIAL MEMBER & 1103/Bang/2015 (Assessment Years : 2003-04 & 2004-05) Income tax Officer, Ward -4(3)(4), Bangalore .. Appellant v. Smt. Sharadamma, No.10, Maruthi Nilaya, Roopena Agrahara, Madiwala, Bangalore 560 068 .. Respondent PAN : AGHPS4698H Cross objection Nos.203 & 204/Bang/2015 (I.T.A Nos.1034 & 1103/Bang/2015) (Assessment Years : 2003-04 & 2004-05) (By the Assessee) Assessee by : None Revenue by : Shri. L. V. Bhaskar Reddy, JCIT Heard on : 06.01.2016 Pronounced on : 06.01.2016 O R D E R PER ABRAHAM P. GEORGE, ACCOUNTANT MEMBER :

These are appeals and cross objections filed by the Revenue and assessee respectively, against the common order dated 20.04.2015 of CIT (A)-4, Bangalore, for the A. Ys. 2003-04 & 2004-05 ITA.1034 & 1103/Bang/2015 CO.203 & 204/Bang/2015 Page - 2 02. When the appeals and COs were taken up for hearing, the Bench pointed out to the parties that tax effect involved in this appeal was less than Rs.10 lakhs for the impugned assessment year, therefore by virtue of Circular No.21/2015, dt.10.12.2015, is below the limit laid down for filing appeals before this Tribunal.

Ld. DR submitted that para 8 of the circular was not applicable in this case. Therefore he did not object to the application of the circular.

We have perused the orders and heard the contentions. Para 4 of the circular No.21/2015 (supra) is reproduced hereunder :

“4. For this purpose, “tax effect” means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of the issues against which appeal is intended to be filed (hereinafter referred to as “disputed issues”). However the tax will not include any interest thereon, except where chargeability of interest itself is in dispute. In case the chargeability of interest is the issue under dispute, the amount of interest shall be the tax effect. In cases where returned loss is reduced or assessed as income, the tax effect would include notional tax on disputed additions. In case of penalty orders, the tax effect will mean quantum of penalty deleted or reduced in the order to be appealed against.”

ITA.1034 & 1103/Bang/2015 CO.203 & 204/Bang/2015 Page - 3

The tax effect on the issues that are disputed by the Revenue is less than Rs.10 lakhs for the impugned assessment years. Assessee had not challenged the constitutional validity of any provisions of the Act nor had it challenged the legality of the Circular. Revenue has not brought to our notice anything to show that the appeals arose on an issue emanating from any Revenue Audit Objections accepted by the Department. Addition giving rise to the appeal does not relate to any undisclosed foreign assets / bank accounts. Thus we find that circular No.21/ 2015 (supra) is squarely applicable in this case. However if Revenue find that appeal arise out of issues emanating from audit objection it will be free to file MP for recalling this order. If the appeals gets revived then needless to say the COs shall also be revived.

With the above observations appeals of the Revenue and cross objections by the assessee are dismissed.

Pronounced in the open court on this 6th day of January, 2016.

ITO, BANGALORE vs. SMT. SHARADAMMA, BANGALORE

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