ITO 8(3)(4), MUMBAI vs. VISHNU MALL MANAGEMENT P.LTD, MUMBAI
In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.
What did the Tribunal hold?
The Tribunal noted that the tax effect of the disputed issue was below the monetary limit for filing appeals as per CBDT Circular No. 21 of 2015. Therefore, the appeal was not maintainable.
What were the facts?
The Revenue filed an appeal against the CIT(A)'s order concerning the assessment year 2011-12. The disputed issue involved the disallowance of interest expenses.
What were the issues?
The primary issue was whether the appeal filed by the Revenue was maintainable given the low tax effect of the disputed amount, as per CBDT guidelines.
Which sections of the Income-tax Act were involved?
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, MUMBAI BENCHES “F”, MUMBAI
Before: SHRI JASON P. BOAZ (AM) & SHRI SANDEEP GOSAIN (JM)
The aforesaid appeal has been filed by the Revenue against order dated 06/08/2014 passed by the CIT(A)-18, Mumbai in respect of the order of assessment passed u/s 143(3) for the assessment year 2011-12, on the following grounds:- i) " Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in computing and changing the rate of interest to be disallowed without according any opportunity to the Assessing Officer to offer comments in this regard?,.” ii) "Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) erred in restricting the disallowance of interest paid from Rs. 1,88,41,154/- to Rs. 1,64,49,184/- when any such ground was not specifically raised by the assessee? The CIT(A) failed to appreciate that the assessee had not claimed that excess disallowance of interest was made in the assessment order?.” iii) "Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) was justified in holding that disallowance of interest expenses on account of interest-free loan advanced to M/s. Anchor Mall Management Pvt. Ltd. should be calculated for the period for which the loan was utilized i.e. for five months ignoring the fact that the money was also used by the other group concerns of the assessee-company free of interest for the remaining year and hence the relief of Rs. 11,97,945/- granted in this regard is not in accordance with the provisions of the law?” iv)"Whether on the facts and in the circumstances of the case and in law, the Ld. CIT(A) has committed an error in holding that interest of Rs. 2,64,365/- is relatable to interest on current account without noticing the fact that the fund was parked in the current account only on short term basis and its purpose was to re-route these funds on interest-free basis to group concerns?” v)” The appellant prays that the order of the CIT(A) on the above grounds be set aside and that of the A.O be restored. vi)“The appellant craves leave to amend or alter any grounds or add a new ground which may be necessary.”
At the outset, it is brought to the notice of the bench that the disputed issue is only Rs. 23,91,970/- and the tax effect on this amount is below the monetary limit of Rs. 10 lakhs. As per the latest CBDT Circular No. 21 of 2015, dated 10th December, 2015, new guidelines of monetary limit for filing of appeals by the Department has been issued, whereby the tax effect for filing of appeal before the ITAT has been prescribed at Rs. 10 lakhs. In the said Circular, it has been specifically clarified that the said instruction will apply retrospectively to all the pending appeals. Accordingly, the appeal filed by the revenue is not maintainable and is dismissed in limine.
Order pronounced in the open court on 26th May, 2016
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