THE ITO, ( INTL. TAXN.), BARODA vs. SHRI PARESH NATVARLAL SHAH, BARODA

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ITA 2290/AHD/2015Status: DisposedITAT Ahmedabad14 November 2017AY 2008-093 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 dismissed the Revenue's appeal. This was based on the tax effect of the appeal being less than Rs. 10 lacs, as per CBDT Circular No. 21 of 2015.

What were the facts?

The Revenue appealed the CIT(A)'s order allowing the assessee's claim for benefit under Section 54EC of the Income Tax Act. The assessee had claimed a deduction of Rs. 32,60,000/- against capital gains.

What were the issues?

Whether the Revenue's appeal should be dismissed due to low tax effect as per CBDT circulars. The primary dispute was about the allowability of Section 54EC deduction.

Which sections of the Income-tax Act were involved?

Section 54EC

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, AHMEDABAD “C” BENCH

Before: SHRI N.K. BILLAIYA & SHRI S. S. GODARA

For Appellant: Shri Prasoon Kabra, Sr. D.R

PER N.K. BILLAIYA, ACCOUNTANT MEMBER 1. This appeal by the Revenue and the cross objection of the assessee are directed against the order of the ld. CIT(A)-13, Ahmedabad dated 22.05.2015 pertaining to A.Y. 2008-09.

ITA No. 2290/Ahd/2015 7 & C.O. No. 171/A/15 2 . A.Y. 2008-09 2. The sum and substance of the grievance of the revenue is that the ld. CIT(A) erred in allowing the claim of benefit of Section 54EC of the Act with respect to the capital gains earned by the assessee during the year under consideration.

3.

At the very outset, the ld. counsel for the assessee furnished the following computation of tax effect: Parcsh N Shah Computation of Tax Effect for AY 2008-09 ITA No. 2290/A/2015 - Department's Appeal

Particulars Amount (Rs.)

Total Income as per AO Total Income as per CIT(A) 56,01,050 Amount contested as by the Department 23,41,050 32,60,000

Tax ® 20% 6,52,000

Education and Higher Education Cess @ 3% 19,560

Net Tax Impact 6,71,560

NOTE: The Department has challenged the action of the CIT(A) in deleting addition made by the AO for claim of deduction u/s. 54EC of the Act of Rs.32,60,000/-. The rate of tax on long term capital gain is 20%.

4.

A perusal of the above shows that the tax effect being less than Rs. 10 lacs, the appeal has to be dismissed in the light of the CBDT Circular no. 21 of 2015 dated 10.12.2015.

5.

If the revenue subsequently feels that the appeal is not hit by the said Circular of the CBDT it may approach the Tribunal as per provisions of the law.

ITA No. 2290/Ahd/2015 7 & C.O. No. 171/A/15 3 . A.Y. 2008-09

6.

C.O. was not pressed by the ld. counsel and the same is also dismissed as not pressed.

Order pronounced in Open Court on 14 - 11- 2017.

Sd/- Sd/- (S. S. GODARA) (N. K. BILLAIYA) JUDICIAL MEMBER True Copy ACCOUNTANT MEMBER Ahmedabad: Dated: 14 /11/207 Rajesh Copy of the Order forwarded to:- 1. The Appellant. 2. The Respondent. 3. The CIT (Appeals) – 4. The CIT concerned. 5. The DR., ITAT, Ahmedabad. 6. Guard File. By ORDER

Deputy/Asstt.Registrar ITAT,Ahmedabad

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