ITO 14(1)(4), MUMBAI vs. BOMBAY FANCY TEXTILE CO, MUMBAI

The facts of the case are that the assessee filed its return of income on 15.10.2010 declaring total income at Rs.95,917/-. In the scrutiny proceedings, the Assessing Officer after making certain disallowances framed the assessment u/s 143(3) at Rs.22,79,730/-. Aggrieved by the order of the AO, the assessee preferred an appeal before the ld.CIT(A), who in turn deleted the addition of Rs.11.12,860/- u/s 41(1) of the Act. Being aggrieved by the order of ld.CIT(A), the revenue is in appeal before us. None appeared on behalf of the assessee and therefore proceeded to decide this 3. appeal ex-parte without the presence of assessee and after hearing the ld.DR. From the fact, we find that the assessee declared return of income at Rs.95,917/- and hence, the AO made an addition of Rs.21,83,813/- by making various disallowances. In the first appellate stage, the ld.CIT(A) allowed the relief of Rs.11,12,860/-. Therefore, the net income remained Rs.11,12,860/-. We find that the tax effect involved in this appeal is less than Rs.10 lakhs and according to the CBDT circular bearing Circular No.21/2015 dated 10.12.2015 the revenue is precluded from filing any appeal before the ITAT where tax effect is less than Rs.10 lakhs and the said circular has retrospective effect and is applicable to the existing appeals also. Therefore, this appeal filed by the Revenue is not maintainable as per the instructions given in CBDT circular mentioned above. Accordingly, we dismiss the appeal of the revenue being below Rs.10 lakhs.