DCIT, NEW DELHI vs. M/S. I.P. JEWELLERS PVT. LTD., NEW DELHI

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ITA 576/DEL/2014Status: DisposedITAT Delhi08 January 2016AY 2007-084 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 CBDT circular regarding monetary limits for appeals is binding on the Department. Since the tax effect was below the prescribed limit, the Department should have withdrawn or not pressed the appeal.

What were the facts?

The Department appealed the deletion of a penalty of Rs. 4,36,690/- imposed under Section 271(1)(c) of the Income Tax Act. The tax effect in the appeal was below the monetary limit prescribed by CBDT Circular No. 21/2015.

What were the issues?

Whether the Department's appeal is maintainable before the Tribunal when the tax effect is below the monetary limit specified by CBDT circulars.

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 18.11.2013 of Ld.CIT(A)-XV, New Delhi pertaining to assessment year 2007-08 on the following grounds:- “

1. On the facts and circumstances of the case and in law, the CIT(A) has erred in deleting the penalty of Rs. 4,36,690/- made u/s 271(1)(c) of the Income Tax Act, 1961.

2. The appellant craves leave to add, alter or amend any ground of appeal raised above at the time of hearing.”

2.

We have heard both the parties and perused the material on record. We find that Revenue in the Grounds of Appeal

before the Tribunal has challenged the deletion of penalty of Rs. 4,36,690/- u/s. 271(1)(c) of the I.T. Act, 1961 vide ground no. 1, as aforesaid.

3. 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.”

4.

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.

5.

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.

6.

In the result, Appeal filed by the Revenue Stands dismissed. Order pronounced in the Open Court on 08/1/2016.

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