THE ACIT, CIRCLE-7(2), AHMEDABAD vs. M/S. CHIRAG CONSTRUCTION, AHMEDABAD

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ITA 1952/AHD/2015Status: DisposedITAT Ahmedabad26 October 2017AY 2012-132 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 held that the Revenue's appeal was not maintainable due to low tax effect, as per CBDT Circular No. 21 of 2015. Consequently, the assessee's cross-objection was dismissed as infructuous.

What were the facts?

The Revenue appealed against the CIT(A)'s order deleting a penalty under Section 271(1)(c). The assessee filed a cross-objection. The Revenue's appeal was based on the deletion of a penalty of Rs. 6,38,650.

What were the issues?

The primary issue was the maintainability of the Revenue's appeal before the ITAT due to the low tax effect of the penalty deletion. The secondary issue was the fate of the assessee's cross-objection.

Which sections of the Income-tax Act were involved?

Section 271(1)(c)

AI-generated summary — verify with the full judgment below

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

Heard together (2 matters)

ITA No. 1952/Ahd/2015
CO 146/Ahd/2015

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

ITA No. 1952/Ahd/2015 & CO 146/Ahd/2015 ACIT vs Chirag Construction Assessment year: 2012-13 Page 1 of 2

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD “B” BENCH, AHMEDABAD [Coram: Pramod Kumar AM and Rajpal Yadav JM] ITA No.1952/Ahd/2015 & CO No.146/Ahd/2015 Assessment Year: 2012-13

ACIT .......…………...........Appellant Circle – 7 (2), Ahmedabad Vs. M/s. Chirag Construction ........................Respondent & 32, Prabhupark Society, Cross-Objector Nr. Bethak, Naroda, Ahmedabad-382330 [PAN : AAGFC 2093 P]

Appearances by: Mudit Nagpal for the appellant Rameshbhai S Patel for the respondent Date of concluding the hearing : 26.10.2017 Date of pronouncing the order : 26.10.2017 O R D E R Per Pramod Kumar AM: 1. This appeal by the Revenue and the cross-objection thereof by the assessee are directed against the order dated 13.09.2015 passed by the CIT(A)-7, Ahmedabad in the matter of penalty under Section 271(1)(c) of the Income-tax Act for Assessment Year 2012-13.

2.

The grievance raised by the Assessing Officer is as follows:-

“The Ld. CIT(A) has erred in law and on facts in deleting the penalty of Rs.6,38,650/- without considering the reasons mentioned by the AO in his order u/s 271(1)(c) and without considering the provisions of Explanation 1 to Section 271(1)(c) of the Act.”

3.

So far as the appeal of the Revenue is concerned, at the outset, the learned counsel for the assessee points out that the 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 learned Departmental Representative fairly admitted that the tax effect is less than the limit prescribed by the aforesaid CBDT Circular.

4.

Having heard the rival contentions and having perused the material on record, we find that prima-facie this appeal of the Revenue is not maintainable in view of

ITA No. 1952/Ahd/2015 & CO 146/Ahd/2015 ACIT vs Chirag Construction Assessment year: 2012-13 Page 2 of 2

CBDT Circular No. 21/2015 in F.No.279/Misc. 142/2007-ITJ (Pt) dated 10th December 2015, vide which it has been provided that if the tax effect by virtue of the Commissioner of Income-tax (Appeals)’s order is below Rs. 10 lacs, then that order would not be challenged before the Tribunal in further appeal. The Board has provided exemptions at clause (8) of the Instructions wherein it has been provided that these instructions will not be applicable, if vires of any provisions has been quashed by impugned order or addition was made on some audit objections or the addition relates to undisclosed foreign assets/bank accounts, etc. We find that the present case does not fall within the exemption clause and the tax is less than Rs.10 lacs. Therefore, the present appeal is not maintainable and hence dismissed.

5.

The appeal of the Revenue is thus dismissed in limine.

6.

As the appeal filed by the Revenue itself is found to be non-maintainable and as the cross-objection of the assessee arises only as a result of this appeal, the cross objection filed by the assessee is also dismissed as infructuous.

7.

In the result, the appeal and cross-objection, both are dismissed. Pronounced in the open court today on the 26th day of October, 2017.

Sd/- Sd/-

Rajpal Yadav Pramod Kumar (Judicial Member) (Accountant Member) Ahmedabad, the 26th day of October, 2017 **bt Copies to: (1) The appellant (2) The respondent (3) Commissioner (4) CIT(A) (5) Departmental Representative (6) Guard File By order TRUE COPY Assistant Registrar Income Tax Appellate Tribunal Ahmedabad benches, Ahmedabad 1. Date of dictation: ......26.10.2017.... 2. Date on which the typed draft is placed before the Dictating Member: ... 26.10.2017........ 3. Date on which the approved draft comes to the Sr. P.S./P.S.: …..26.10.2017..... . 4. Date on which the fair order is placed before the Dictating Member for Pronouncement: ... 26.10.2017...... 5. Date on which the file goes to the Bench Clerk : .. 26.10.2017.... 6. Date on which the file goes to the Head Clerk : ……………………………. 7. The date on which the file goes to the Assistant Registrar for signature on the order: ……………………..

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