DCIT 24(3), MUMBAI vs. AMBALAL KISHORBHAI PATEL, MUMBAI

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ITA 3909/MUM/2014Status: DisposedITAT Mumbai02 June 2016AY 2010-113 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 dismissed the Revenue's appeal in limine. It was held that the appeal was not maintainable as the tax effect was below Rs. 10,00,000 and did not fall under any exceptions mentioned in the relevant CBDT circular.

What were the facts?

The Revenue filed an appeal against the CIT(A)'s order deleting additions made on account of gift received and excess interest paid. The assessee argued that the tax effect was below the threshold specified in a CBDT circular.

What were the issues?

Whether the Revenue's appeal is maintainable given the tax effect below the threshold specified by CBDT circulars. The maintainability of the appeal was the primary issue.

Which sections of the Income-tax Act were involved?

Section 56(2)(v)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, MUMBAI BENCHES “A”, MUMBAI

Before: SHRI R.C.SHARMA (AM) & SHRI RAM LAL NEGI (JM)

For Appellant: Shri. Morya Pratap
For Respondent: Shri. Sanjay Parikh & Haresh P
Hearing: 02/06/2016Pronounced: 02/06/2016

This appeal has been filed by the revenue against order dated 21/03/2014 passed by the Ld CIT(A)-34, Mumbai for the assessment year 2010-11.

2.

The revenue has challenged the impugned order on following effective grounds of appeal:-

1. Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of Rs. 12,75,000/- made on account of gift received and adjudicating the appeal in favour of the assessee when the gift received form HUF cannot be treated as exempt as HUF does not comprise in the definition of close

relative as per the provisions of section 56(2)(v) of the Act and thus misinterpreting the unambiguous language of the aforesaid section.”

2. On the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of Rs. 19,87,065/- made on account of excess interest paid in term loan ignoring the fact that the assessee had paid higher interest on loans taken as compared to the interest received at lower rates.”

3.

At the outset, the Ld. Counsel for the assessee submitted that the tax effect in this case is below 10,00,000/- the addition of Rs. 19,87,065/- made on account of gift received. Hence, as per the CBDT Circular No. 21 of 2015, dated 10/12/2015, the present appeal is not maintainable.

4.

The Ld. DR fairly admitted that the tax effect in department’s appeal is below 10 Lakhs, We find that the issue raised in appeal does not fall under any of the exceptions specified in para 8 of the Circular. Since, it has been specifically clarified in the Circular aforesaid that the instruction will apply retrospectively to all the pending appeals; the present appeal filed by the revenue is not maintainable. We, therefore, dismiss the same in limine.

Order pronounced in the open court on 2nd June, 2016

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