What did the Tribunal hold?

The Tribunal dismissed the appeal as withdrawn. This was based on the CBDT Circular No. 21/2015, which mandates dismissal of appeals where the tax effect is below Rs. 10,00,000.

The Assessing Officer appealed the CIT(A)'s deletion of disallowance for packing material expenses. The AO argued that the month-wise ratio of expenses to turnover varied significantly, and the assessee failed to maintain stock records.

What were the issues?

The primary issue was the validity of the disallowance of packing material expenses. However, the appeal was dismissed on procedural grounds due to low tax effect.

ACIT vs M/S. Stitchwell Garments | ITAT Ahmedabad 2017

Income Tax Appellate Tribunal, AHMEDABAD SMC BENCH, AHMEDABAD

IN THE INCOME TAX APPELLATE TRIBUNAL, AHMEDABAD SMC BENCH, AHMEDABAD [Coram : Pramod Kumar, Accountant Member] ITA No.2413/Ahd/2015 Assessment Year: 2011-12

Assistant Commissioner of Income Tax, Circle – 3(2), Ahmedabad. …...…..………Appellant Vs. Stitchwell Garments, …………….Respondent 2011/B, Phase-4, GIDC, Vatva, Ahmedabad – 382 445. [PAN : AAJPS 0523 P] Appearances by : Vimal I. Mehta for the appellant M.K. Patel for the respondent Date of concluding the hearing : 14.08.2017 Date of Pronouncing the order : 17.08.2017 O R D E R

By way of this appeal, the Assessing Officer has challenged correctness of the order dated 10th June, 2015, passed by the learned CIT(A)-3, Ahmedabad for the assessment year 2011-12, on the following grounds :-

“1. The Id. CIT(A) has erred in law and on facts in deleting the disallowance of packing material expenses of Rs.20,10,080/-. 2. The Id.CIT(A) has erred in law and on facts by not appreciating the facts that month-wise ratio of packing material expenses vis-a-vis turnover varies from 4.92% to 13.49% and the assesses had failed to satisfactorily explain the reasons for such variance and disproportionate consumption of packing material.

The Id.CIT(A) has erred in law and on facts by not appreciating the facts that the assessee had failed to maintain stock register of packing material and had not shown in the books of account any opening stock or closing stock of packing material. 4. The Id. CIT(A) has erred in law and on facts by holding that the AO had not given any justification or reasoning for making the addition ignoring the fact that in the assessment order the AO had pinpointed the discrepancies, which the assessee failed to explain either during assessment proceedings or at appellate stage. 5. The Id.CIT(A) has erred in law and on facts by following the decision in the assessee's own case for A.Y. 2008-09, 2009-10 and 2010-11 though the facts pointed out in the assessment for the year under consideration are different to that of earlier years. 6. On the facts and circumstances of the case, the Ld. Commissioner of Income tax (A) ought to have upheld the order of the Assessing Officer to the above extent. 7. It is, therefore, prayed that the order of the Ld. Commissioner of Income Tax (A) may be set-aside and that of the Assessing Officer be restored to the above extent.”

We have noticed that the tax effect involved in this appeal is less than Rs.10,00,000/-. In view of this undisputed fact and in the light of CBDT Circular No.21/2015 dated 10th December, 2015, we are of the considered view that this appeal is liable to be dismissed as withdrawn for the simple reason that tax effect involved in this appeal is less than Rs.10,00,000/-.

In the result, appeal is dismissed. Pronounced in the open court today on the 17th day of August, 2017. Sd/- Pramod Kumar (Accountant Member) Dated: Ahmedabad, the 17th day of August, 2017. PBN/* Copies to: (1) The appellant (2) The respondent (3) CIT (4) CIT(A) (5) DR (6) Guard File

By order Assistant Registrar Income Tax Appellant Tribunal Ahmedabad Benches, Ahmedabad

THE ACIT, CIRCLE-3(2), AHMEDABAD vs. M/S. STITCHWELL GARMENTS, AHMEDABAD

What did the Tribunal hold?

What were the facts?

What were the issues?

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