What did the Tribunal hold?

The Tribunal held that the appeal filed by the Revenue was not maintainable as the tax effect was below the prescribed monetary limit for filing appeals before the Tribunal.

The Revenue filed an appeal against the CIT(Appeals) order which deleted an addition on account of unexplained cash deposit. The tax effect of the addition was less than Rs. 3 lakhs.

What were the issues?

Whether an appeal filed by the Revenue is maintainable before the ITAT when the tax effect is below the prescribed monetary limit as per departmental instructions and Supreme Court pronouncements.

ITO vs Sh. Balwan Singh Mann, New Delhi | ITAT Delhi 2015

Income Tax Appellate Tribunal, DELHI BENCH ‘A’ : NEW DELHI

Before: SHRI A.T. VARKEY & SHRI L.P. SAHU

For Respondent: Shri K.K. Jaiswal, Senior DR

Hearing: 09.12.2015Pronounced: 11.12.2015

PER A.T. VARKEY, JUDICIAL MEMBER :

This appeal filed by the revenue emanates from the order of the CIT (Appeals)-XXX, New Delhi dated 03.08.2012 for the assessment year 2008-09. 2. In this case, the revenue has come in appeal on account of admitting the additional evidence in contravention of Rule 46A without giving an opportunity to the assessee and deleting the addition on account of unexplained cash deposit in Andhra Bank of Rs.10,19,000/-.

None present on behalf of the assessee. However, we take notice that the tax effect on the addition made is less than Rs.3 lakhs. The ld. DR fairly conceded that in this case, the tax effect would be less than Rs.3 lakhs.

Therefore, as per the Instruction No. 3/2011 dated 09.02.2011, the revenue is not permitted to file appeal before the Tribunal if the tax effect is less than Rs.3.00 lakhs. The decision of Hon’ble Supreme Court dated 25.03.2011 in to 5/2010 is also considered in this regard. The Assessment Year in the appeal is 2008-09. The appeal has been filed on 14.11.2012.

We have heard both the sides and gone through the material available on record. Instruction No.3/2011 dated 09.02.2011 has revised the monetary limit for filing the appeal by the department before Income-tax Appellate Tribunal, Hon’ble High Courts and Hon’ble Supreme Court. As per the said circular, monetary limit for filing the appeal before the Tribunal is Rs.3.00 lakhs; before Hon’ble High Court Rs. 10.00 lakhs and before Hon’ble Supreme Court Rs. 25.00 lakh. Hon’ble Supreme Court in the order dated 25.03.2011 referred to above has held as under:-

“It is stated that the tax impact in the present cases is less than Rs.10.00 lacs. The Department has recently issued an instruction bearing no. 3/2011 dated 09.02.2011, which is identical to its earlier instruction bearing no. 5/2008 dated 15.05.2008 except that in so far as the High Court is concerned, the monetary limit in respect of appeals where the questions of law raised need not to be answered, has been raised from Rs. 4.00 lacs to Rs. 10.00 lacs. The Division Bench of this Court in decided on 28.01.2011 has already held that the instruction bearing no. 5/2008 dated 15.05.2008 would apply even to the old pending references and appeals. This principle would thus naturally equally apply to the instant instruction bearing no.3/2011 dated 09.02.2011, as well. The tax effect being less than Rs.10.00 lacs, the question of law does not require to be answered. The appeals are disposed of accordingly.”

4.1 In view of the above, respectfully following the precedent, it is held that the appeal is not maintainable in the instant case as the tax effect is less than Rs.3 lakhs. Accordingly, it is held that appeal filed by the revenue is not maintainable.

In the result, appeal filed by the department is dismissed without going into the merits.

Order pronounced in open court on this day of 11TH December, 2015.

ITO, NEW DELHI vs. SH. BALWAN SINGH MANN, NEW DELHI

What did the Tribunal hold?

What were the facts?

What were the issues?

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