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Income Tax Appellate Tribunal, DELHI BENCH ‘F’, NEW DELHI
Before: SHRI H.S. SIDHU & SHRI PRASHANT MAHARISHI
This appeal by the Department is directed against the Order dated 26.12.2013 of Ld.CIT(A)-XVII, New Delhi pertaining to assessment year 2010-11 on the following grounds:- “
1. On the facts and in the circumstances of the case and in law, the CIT(A) has erred in deleting the disallowance of Rs. 27,00,001/- made by the AO u/s. 35D of the Act.
2. On the facts and in the circumstances of the case, the Ld. CIT(A) has erred in deleting the disallowance made by the AO u/s. 35D of the Act ignoring the fact that it retains the character of a capital expenditure since the expenditure was directly related to the expansion of the capital base of the company.
3. The appellant craves to be allowed to add any fresh grounds of appeal and / or delete or amend any of the grounds of appeal.
We have heard both the parties and perused the material on record. We find that Revenue in the Grounds of Appeal
before the Tribunal has challenged the deletion of addition of Rs. 27,00,001/- u/s. 35D of the I.T. Act, 1961 vide ground no. 1, as aforesaid.
3. From the above, we find that the tax effect in the Revenue’s Appeal is less than Rs.10,00,000/-, therefore, the Department’s Appeal is not maintainable, in view of the Circular No. 21/2015 dated 10th December, 2015 issued vide F.No. 279/Misc. 142/2007-ITJ (Pt.) by the CBDT. For the sake of convenience, the relevant para nos. 3 & 10 of the aforesaid CBDT’s Circular are reproduced as under:- “3. Henceforth, appeals/ SLPs shall not be filed in cases where the tax effect does not exceed the monetary limits given hereunder: Monetary Limit S No Appeals in Income-tax matters (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.
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 Pending appeals below the specified tax limits in para 3 above may be withdrawn/ not pressed.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.”
It is not in dispute that the Board’s instruction or directions issued to the income-tax authorities are binding on those authorities, therefore, the Department should have withdrawn/ not pressed the present Appeal, in view of the aforesaid instructions since the tax effect in the instant Appeal is less than the amount of Rs. 10 lacs, prescribed in the above said CBDT’s Instructions.
Keeping in view the CBDT Instruction No. 21/2015 dated 10th December, 2015, we are of the view that the Revenue should have withdrawn/ not pressed the instant appeal before the Tribunal. We are also of the view that the said Instructions are applicable for the pending appeals and appeals to be filed henceforth in Tribunal. Accordingly, the Revenue’s Appeal is dismissed. 6. In the result, Appeal filed by the Revenue Stands dismissed. Order pronounced in the Open Court on 06/4/2016.