What did the Tribunal hold?

The Tribunal dismissed the Revenue's appeal on the grounds of low tax effect, as it was below the monetary limit prescribed by CBDT Circular No. 21 of 2015. Consequently, the assessee's Cross Objection was also dismissed as infructuous.

The Revenue filed an appeal against the deletion of penalty by the CIT(A). The assessee filed a Cross Objection. The Revenue's appeal was based on grounds related to the deletion of penalty despite the assessee's appeal being in the admission stage before the High Court.

What were the issues?

The primary issue was whether the Revenue's appeal was maintainable given the low tax effect, as per CBDT guidelines. The Tribunal also considered the grounds raised by the Revenue regarding the deletion of penalty.

ITO vs Mahrukh M. Oomrigar | ITAT Mumbai 2016

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

Before: SHRI SHAILENDRA KUMAR YADAV, JUDICIAL & SHRI RAJESH KUMAR.

Hearing: 09.08.2016Pronounced: 12.08.2016

Heard together (2 matters)

ITA. No.5915/Mum/2013

C.O. No.34/Mum/2015

Read from the judgment's own cause title. This page is filed under one of them.

One appeal is filed by Revenue and the Cross Objection has been filed by assessee are arising from the order of Commissioner of Income Tax (Appeals)-32, Mumbai, dated 29.07.2013 for A.Y. 2006-07.

2. In Revenue has taken following grounds of appeal:-

“1. On the facts and in the circumstances of the case and in law, the Ld CIT(A) erred in deleting penalty on the ground of admission of appeal before the Hon’ble High Court on substantial question of law.

2. On the facts and in the circumstances of the case and in law, the Ld CIT(A) erred in deleting penalty ignoring that the appeal of the assessee before the Hon’ble High Court is in admission staged and is pending for finalization.”

Before us, at the outset, ld. Authorized Representative submitted that the present appeal of the Revenue needs to be dismissed on account of low tax effect in view of the CBDT Circular No.21 of 2015 dated 10.12.2015. The ld. Departmental Representative fairly admitted that the tax effect & C.O. No.34/Mum/15 A.Y. 06-07 [ITO vs. Smt. Maharukh M. Oomrigar] Page 3 is less than the limit prescribed by the aforesaid CBDT Circular.

2.1 We have heard the rival submissions and perused the material on record. On perusing the ground of appeal raised by the Revenue, we prima-facie find that the tax effect in this appeal is below Rs.10 lacs. As per the announcement of Central Board of Direct Taxes (CBDT) dated 10.12.2015 (Circular No. 21 of 2015), no Department appeals are to be filed against relief given by ld. CIT(A) before the Income Tax Tribunal unless the tax effect, excluding interest exceeds Rs. 10 lacs and it further states that the instructions will apply retrospectively to the pending appeals. In the present case, since it is an undisputed fact that on the additions which are in dispute, the tax effect is less than Rs. 10 lacs and in the absence of any material on record by the Revenue to demonstrate that the issue in the present appeal is covered by exemptions specified in clause (8) of the aforesaid CBDT Circular, we are of the view that the monetary limit prescribed by the instructions of the aforesaid CBDT Circular would be applicable to the present appeal of the Department and therefore the present appeal is not maintainable on account of low tax effect. However, in case there is any error in the computation of the tax effect involved or if for any reason, the aforesaid CBDT Circular is not applicable, it would be open to the Revenue to seek revival of the appeal. In such circumstances, we dismiss the appeal of Revenue without expressing any opinion on merits of the case. & C.O. No.34/Mum/15 A.Y. 06-07 [ITO vs. Smt. Maharukh M. Oomrigar] Page 4

In the result, the appeal of Revenue is dismissed.

When Revenue’s appeal is dismissed, Cross Objection arising out of same, become infructuous. So, same is dismissed.

In the result, appeal filed by Revenue and Cross Objection filed by assessee are dismissed.

Pronounced in the open Court on this the 12th day of August, 2016.

ITO 21(1)(3), MUMBAI vs. MAHRUKH M. OOMRIGAR, MUMBAI

What did the Tribunal hold?

What were the facts?

What were the issues?

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