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Income Tax Appellate Tribunal, MUMBAI “E” BENCH, MUMBAI
Before: SHRI SHAILENDRA KUMAR YADAV, JUDICIAL & SHRI RAJESH KUMAR.
अपीलाथ� क� ओर से /By Appellant : Shri Vinod Kumar, D.R. ��यथ� क� ओर से/By Respondent : Shri Satish Modi, A.R. सुनवाई क� तार�ख/Date of Hearing : 16.06.2016 घोषणा क� तार�ख/Date of Pronouncement : 17.06.2016 ORDER PER SHAILENDRA KUMAR YADAV, J.M:
This appeal has been filed by Revenue against the order of Commissioner of Income-Tax (Appeals)-23, Mumbai, dated 16.12.2010 for A.Y. 1996-97 on following grounds:
“1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in directing the Assessing Officer to compute the interest disallowance on the net A.Y. 96-97 [ITO vs. Mrs. Sushiladevi O. Parasrampuria) Page 2 interest bearing fund amounting to Rs.39,80,926/- used for investment in personal assets/interest free advances.
2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) failed to appreciate the fact that the disallowance of interest of Rs.23,37,805/- was made by the Assessing Officer since the interest payment on loan borrowed for investment in personal asset to the tune of Rs.1,71,48,377/- were not allowable expenditure u/s 37(1) as the same had not been expended wholly and exclusively for the purpose of business.”
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 is less than the limit prescribed by the aforesaid CBDT Circular.
2.1 We have heard the ld. D.R. and perused the material on record. On perusing the grounds 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 A.Y. 96-97 [ITO vs. Mrs. Sushiladevi O. Parasrampuria) Page 3 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 appeals of Revenue without expressing any opinion on merits of the case.
In the result, the appeal of Revenue is dismissed.
Pronounced in the open Court on this the 17th day of June, 2016.
Sd/- Sd/- (RAJESH KUMAR) (SHAILENDRA KUMAR YADAV) ACCOUNTANT MEMBER JUDICIAL MEMBER Mumbai: Dated 17/06/2016 True Copy S.K.SINHA आदेश क� ��त�ल�प अ�े�षत / Copy of Order Forwarded to:- 1. राज�व / Revenue 2. आवेदक / Assessee 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त- अपील / CIT (A) 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, मुंबई / DR, ITAT, Mumbai 6. गाड� फाइल / Guard file. By order/आदेश से,
उप/सहायक पंजीकार, आयकर अपील�य अ�धकरण, मुंबई ।