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Income Tax Appellate Tribunal, RAIPUR BENCH, RAIPUR
Before: SHRI RAVISH SOOD & SHRI ARUN KHODPIA
आदेश / ORDER
PER RAVISH SOOD, JM:
The present appeal filed by the revenue is directed against the order passed by the CIT(Appeals)-I, Raipur, dated 26.07.2019, which in turn arises from the order passed by the A.O under Sec.143(3) r.w.s. 147 of the Income-tax Act, 1961 (in short ‘the Act’) dated 23.12.2017 for assessment year 2010-11. Also, the assessee is before us as a cross-objector.
Central Board of Direct Taxes (CBDT) vide Circular No. 17/2019 dated 08.08.2019 has amended Circular No. 3/2018 dated 11.07.2018 for further enhancement of monetary limit for filing of appeals by the Department before the ITAT, High Courts and SLPs/Appeals before Supreme Court as measures for reducing litigation.
CBDT vide Circular No. 3/2018 dated 11.07.2018 has specified that appeals shall not be filed before the Income Tax Appellate Tribunal (ITAT) in cases where the tax effect does not exceed the monetary limit of Rs.20,00,000/-. For this purpose, ‘tax effect’ means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of issues against which appeal is intended to be filed. Further, ‘tax effect’ shall be taxes including applicable surcharge and cess.
3 ITO-2(1) Vs. Shri Binod Kumar Agrawal CO No.01/RPR/2020 However, the tax will not include any interest thereon, except where chargeability of interest itself is in dispute. In case the chargeability of interest is the issue under dispute, the amount of interest shall be the ‘tax effect’. In cases where returned loss is reduced or assessed as income, the ‘tax effect’ would include notional tax on disputed additions. In case of penalty order, the ‘tax effect’ will mean quantum of penalty deleted or reduced in the order to be appealed against.
At para 13 of the above Circular, it has been mentioned that:
“13. This Circular will apply to SLPs/appeals/cross objection/references to be filed henceforth in SC/HCs/Tribunal and it shall also apply retrospectively to pending SLPs/appeals/cross objections/references. Pending appeals below the specified tax limits in para 3 above may be withdrawn/not pressed.”
As a step towards further management of litigation, CBDT vide Circular No. 17/2019, dated 08.08.2019 has fixed the monetary limit for filing of appeals before ITAT at Rs.50,00,000/-.
In the instant appeal filed by the Department, it was averred by the ld. A.R that the ‘tax effect’ therein involved was below the monetary limit of Rs.50,00,000/-. The said fact was brought to the notice of the ld. Departmental Representative (for short ‘D.R’) who objected to the seeking of withdrawal of the appeal on the ground that as the addition in the case of the assessee was based on the information received from the 4 ITO-2(1) Vs. Shri Binod Kumar Agrawal CO No.01/RPR/2020 Commercial Tax Department, Raipur, therefore, the same as per Para 10(e) of the CBDT Circular dated 20.08.2018 was saved from applicability of the monitory ceiling contemplated vide CBDT Circular No.3 of 2018 dated 11.07.2018.
Rebutting the aforesaid claim of the Ld. DR it was submitted by the assessee’s Counsel that as the information gathered by the A.O from Commercial Tax Department would not be covered by Para 10(e) (supra), therefore, the aforesaid claim of the Department is absolutely misconceived.
We have heard the ld. Authorized Representatives of both the parties, perused the orders of the lower authorities and the material available on record, as well as considered the judicial pronouncements that have been pressed into service by the Ld. AR to drive home his aforesaid contentions.
After having given a thoughtful consideration, we concur with the claim of the Ld. AR that an addition made on the basis of information received by the A.O from Commercial Tax Department, Raipur would not bring the same within the sweep of the exception carved out in Para 10 (e) of the CBDT Circular dated 20.08.2018. Our aforesaid view is fortified by the order of the Hon’ble High Court of Chhattisgarh in the case of DCIT-1,
5 ITO-2(1) Vs. Shri Binod Kumar Agrawal CO No.01/RPR/2020 Bhilai Vs. Bhojraj Lal Chand Nawani, MCC No.621 of 2019 dated 16.09.2019. Considering the aforesaid facts we find favour with the claim of the Ld. AR and dismiss the appeal filed by the revenue.
In the result, appeal of the Revenue is dismissed in terms of our aforesaid observations.
CO No. 01/RPR/2020 A.Y.2010-11
As we have dismissed the appeal filed by the revenue as not maintainable, therefore, the cross objection filed by the assessee assailing the validity of the jurisdiction assumed by the A.O for reopening of the assessee’s case having been rendered as merely academic is accordingly dismissed.
In the result the cross-objection filed by the assessee in CO No.01/RPR/2020 is dismissed as not pressed.
In the combined result, both, the appeal of the revenue and cross objection filed by the assessee are dismissed in terms of our aforesaid observations.
6 ITO-2(1) Vs. Shri Binod Kumar Agrawal CO No.01/RPR/2020 Order pronounced under rule 34(4) of the Appellate Tribunal Rules, 1963, by placing the details on the notice board.