ITO WD 19(3)(4), MUMBAI vs. SHIRISH MANOHAR NADKARNI, MUMBAI

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ITA 8567/MUM/2011Status: DisposedITAT Mumbai11 March 2016AY 2003-043 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 Department's appeal. This was based on the submission that the tax effect of the disputed amount was below the monetary limit prescribed by the CBDT for appeals.

What were the facts?

The Department appealed against the deletion of an addition of Rs. 9,56,944/- made by the Assessing Officer. The addition was related to expenditure incurred for the purchase of foreign exchange.

What were the issues?

Whether the Department's appeal is maintainable considering the tax effect and CBDT circulars regarding monetary limits for appeals.

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “E” BENCH, MUMBAI

Before: SHRI SAKTIJIT DEY & SHRI RAMIT KOCHAR

For Appellant: Shri Vishwas Mahandale
For Respondent: Shri Ritesh Misra, Shri Vishwas Mahandale

Aforesaid appeal of the Department is directed against the order dated 28th October 2011, passed by the learned Commissioner (Appeals)–30, Mumbai, for the assessment year 2003–04.

2.

The grounds raised by the Department are as follows:–

“1. On the facts and in the circumstances of the case and in law, the Learned CIT(A) has erred in deleting the addition of Rs.9,56,944/- in respect of expenditure incurred for purchase of Foreign Exchange without appreciating the fact that the 2 Shri Shirish Manohar Nadkarni assessee has failed to establish that the said expenses were incurred wholly and exclusive for the purpose of business by submitting the supporting documentary evidences during the course of assessment proceedings as well as appellate proceedings.

2. On the facts and in the circumstances of the case and in law, the Ld CIT(A) has erred in deleting the addition of Rs.9,56,944/- by presuming that the expenditure was incurred for earning income neglecting the finding by the A.O that the assessee had failed to establish that the said expenses were incurred wholly and exclusively for the purpose of business without appreciating that the assessee specializing in India- Centric business writing, there cannot be a legitimate presumption regarding expenditure in foreign currency being business expenditure.”

3.

Both the learned Representative of the parties submitted before us that the tax effect pertaining to the amounts disputed by the Department is less than the monetory limit of ` 10 lakh fixed by the CBDT in Circular no.21 of 2015 dated 10th December 2015, in relation to appeal before the Income Tax Appellate Tribunal. Taking into consideration the aforesaid submissions of the learned Representatives and also finding that the CBDT circular under reference applies retrospectively, even to pending appeals, we dismiss the appeal of the Department as not maintainable.

4.

In the result, appeal stands dismissed. Order pronounced in the open Court on 10.03.2016

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