ACIT, NEW DELHI vs. MS. TANVI RASTOGI, NEW DELHI

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ITA 1547/DEL/2014Status: DisposedITAT Delhi08 March 2016AY 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 held that the appeal was not maintainable as the tax effect was below the monetary limit prescribed by CBDT Circular No. 21/2015. The Revenue should have withdrawn or not pressed the appeal.

What were the facts?

The Revenue appealed against the deletion of penalty imposed under Section 271(1)(c) on an addition of Rs. 28,69,004/-. The assessee had accepted the quantum addition but the CIT(A) deleted the penalty.

What were the issues?

Whether the Revenue's appeal is maintainable before the ITAT when the tax effect is below the prescribed monetary limit. The applicability of CBDT Circular No. 21/2015 to pending appeals.

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, DELHI BENCH ‘C’, NEW DELHI

Before: SHRI H.S. SIDHU & SHRI PRASHANT MAHARISHI

This appeal by the Department is directed against the Order dated 13.12.2013 of Ld.CIT(A)-XXIII, New Delhi pertaining to assessment year 2008-09 on the following grounds:- “

1. On the basis of the facts and circumstance the ld. CIT(A) has erred in deleting the penalty u/s. 271(1)(c) imposed on the addition made by the AO on the profit of Rs. 28,69,004/-, earned by the Assessee on sale of stock in trade, when the assessee herself has accepted the addition made, by not agitating the quantum addition before the Ld. CIT(A).

2. On the basis of the facts and circumstances the Ld. CIT(A) has erred in deleting the penalty u/s. 271(1)(c) imposed, when AO is correct in holding that, the profit on sale of stock in trade is liable to be taxed as business income, which was calculated at Rs. 28,69,004/- by the AO. 3. The appellant craves leave to add, alter or amend any of the grounds of appeal before or during the course of hearing of the appeal.”

2. In this case, Notice of hearing to the assessee was sent by the Registered AD post, but the same was returned back. Keeping in view the facts and circumstances of the present case and the issue involved in the present Appeal, we are of the view that no useful purpose would be served to issue notice again and again to the assessee, therefore, we are deciding the present appeal exparte qua assessee, after hearing the Ld. DR and perusing the records.

3. We find that Revenue in the Grounds of Appeal before the Tribunal has challenged the deletion of addition of Rs. 28,69,004/- vide ground no. 1, as aforesaid.

4. 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.

10.

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.”

5.

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.

6.

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.

7.

In the result, Appeal filed by the Revenue Stands dismissed. Order pronounced in the Open Court on 08/03/2016.

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