The ACIT, Circle-2(1)(2),, Vadodara v. M/s. Pratham Realty Pvt.Ltd.,, Baroda

ITA 129/AHD/2018 | 2014-2015
Pronouncement Date: 13-11-2019 | Result: Dismissed

Appeal Details

RSA Number 12920514 RSA 2018
Assessee PAN AACCP4084A
Bench Ahmedabad
Appeal Number ITA 129/AHD/2018
Duration Of Justice 1 year(s) 10 month(s) 2 day(s)
Appellant The ACIT, Circle-2(1)(2),, Vadodara
Respondent M/s. Pratham Realty Pvt.Ltd.,, Baroda
Appeal Type Income Tax Appeal
Pronouncement Date 13-11-2019
Appeal Filed By Department
Tags low tax effect
Order Result Dismissed
Bench Allotted A
Tribunal Order Date 13-11-2019
Date Of Final Hearing 23-10-2019
Next Hearing Date 23-10-2019
Last Hearing Date 23-10-2019
First Hearing Date 24-07-2019
Assessment Year 2014-2015
Appeal Filed On 11-01-2018
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH AHMEDABAD BEFORE SHRI RAJPAL YADAV JUDICIAL MEMBER AND SHRI AMARJIT SINGH ACCOUNTANT MEMBER ./ ITA NO. 129/AHD/2018 / ASSESSMENT YEAR: 2014-15 ASSISTANT COMMISSIONER OF INCOME-TAX CIRCLE 2(1)(2) VADODARA VS. M/S. PRATHAM REALTY PVT LTD 1 ST FLOOR PRATHAM ISKON TEMPLE ROAD GOTRI BARODA [PAN : AACCP 4084 A] / (APPELLANT) / (RESPONDENT) REVENUE BY : SHRI VIDHYUT TRIVEDI SR DR ASSESSEE BY : SHRI NIRMIT MEHTA AR ! / DATE OF HEARING : 23/10/2019 / DATE OF PRONOUNCEMENT: 13/11/2019 / O R D E R PER RAJPAL YADAV JUDICIAL MEMBER: THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL AGAINS T THE ORDER OF THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS)-2 VAD ODARA DATED 30.10.2017 PASSED FOR ASSESSMENT YEAR 2014-15. 2. THE GROUNDS TAKEN BY THE REVENUE ARE AS FOLLOWS: - 1.1 THAT IN THE FACTS AND CIRCUMSTANCES OF THE CA SE AND IN LAW THE LD. C.I.T. (A) ERRED IN DELETING DISALLOWANCE OF INTERE ST EXPENDITURE U/S. 36(1)(III) OF THE ACT WITHOUT APPRECIATING THAT TH E ASSESSEE HAD UTILIZED INTEREST BEARING FUNDS RECEIVED FROM M/S. PRATHAM P ROPERTIES FOR ADVANCING INTEREST FREE LOAN TO M/S ASPIRE CONFRA PVT. LTD. 1.2 THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD. C.I.T. (A) ERRED IN DELETING DISALLOWANCE OF INTEREST EXPE NDITURE U/S. 36(1)(III) OF THE ACT WITHOUT APPRECIATING THAT THERE WAS A DIRE CT NEXUS BETWEEN THE INTEREST BEARING FUNDS & INTEREST FREE OUTFLOW AS T HE ASSESSEE ON THE ONE HAND HAD PAID INTEREST TO M/S. PRATHAM PROPERTIES FOR LO AN/ADVANCE RECEIVED BUT DID NOT CHARGE INTEREST ON LOAN ADVANCED TO M/S. AS PIRE CONFRA PVT. LTD. ITA NO. 129/AHD/2018 ACIT VS. PRATHAM REALTY PVT LTD FOR AY: 2014-15 2 3. WHEN THIS APPEAL WAS CALLED OUT FOR HEARING LEA RNED COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE APPEAL OF THE REVENUE N EEDS TO BE DISMISSED ON ACCOUNT OF LOW TAX EFFECT IN VIEW OF THE RECENT CBD T CIRCULAR NO. 17 OF 2019 DATED 08.08.2019 WHEREBY THE MONETARY LIMITS FOR FI LING THE APPEAL BY THE REVENUE BEFORE THE TRIBUNAL WAS ENHANCED FROM RS.20 LAKHS TO RS.50 LAKHS. THIS INSTRUCTION IS APPLICABLE TO THE PENDING CASES ALSO. THEREFORE THE PRESENT APPEAL OF THE REVENUE IS LIABLE TO BE DISMI SSED AS NON-MAINTAINABLE AS HELD BY THIS TRIBUNAL IN THE CASE OF ITO VS. DIN ESH MADHAVLAL PATEL IN ITA NO.1398/AHD/2004 FOR AY 1998-99 VIDE A CONSOLI DATED ORDER DATED 14.08.2019. 4. THE LEARNED DEPARTMENTAL REPRESENTATIVE FAIRLY ADMITTED THAT THE TAX EFFECT INVOLVED IN THE APPEAL IS LESS THAN THE LIMI T PRESCRIBED BY THE AFORESAID CBDT CIRCULAR. 5. WE HAVE HEARD THE RIVAL CONTENTIONS PERUSED THE MATERIAL ON RECORD AND DULY CONSIDERED FACTS OF THE CASE IN THE LIGHT OF APPLICABLE LEGAL POSITION. AS LEARNED COUNSEL RIGHTLY CONTENDS THE PRESENT AP PEAL OF THE REVENUE IS NO LONGER MAINTAINABLE IN VIEW OF THE RECENT CBDT CIRC ULAR NO. 17 OF 2019 DATED 08.08.2019. THE MANDATORY LIMIT FOR CASES IN WHICH REVENUE CAN CHALLENGE THE RELIEF GRANTED BY THE CIT(A) NOW STAN DS ENHANCED TO RS.50 LAKHS. THIS CONCESSION GRANTED BY THE CENTRAL BOAR D OF DIRECT TAXES (CBDT) IS RETROSPECTIVE IN EFFECT INASMUCH AS IT APPLIES T O ALL PENDING APPEALS AS WELL. IN VIEW OF THE ABOVE POSITION THE APPEAL FI LED BY THE REVENUE IS NO LONGER MAINTAINABLE AND IS DISMISSED AS SUCH. 6. IT IS HOWEVER MADE CLEAR THAT ON RE-VERIFICATI ON AT THE END OF THE ASSESSING OFFICER IT COMES OUT THAT THE TAX EFFECT OF MORE THAN RS.50 LAKHS IS BEING INVOLVED IN THE APPEAL OR THE APPEAL FALLS WI THIN THE EXEMPTION CLAUSE OF THE CIRCULAR THEN THE REVENUE WILL BE AT LIBERT Y TO FILE MISCELLANEOUS ITA NO. 129/AHD/2018 ACIT VS. PRATHAM REALTY PVT LTD FOR AY: 2014-15 3 APPLICATION TO RECALL THE TRIBUNAL ORDER. THE APPLI CATION SHOULD BE FILED WITHIN TIME LIMIT PRESCRIBED IN THE ACT. 7. IN THE RESULT APPEAL OF THE REVENUE IS DISMISSE D DUE TO LOW TAX EFFECT. ORDER PRONOUNCED IN THE COURT ON 13 TH NOVEMBER 2019 AT AHMEDABAD. SD/- S D/- (AMARJIT SINGH) ACCOUNTANT MEMBER (RAJPAL YADAV) JUDICIAL MEMBER AHMEDABAD; DATED 13/11/2019 BIJU T. SR.PS ! &'( )( / COPY OF THE ORDER FORWARDED TO : 1. / THE APPELLANT 2. / THE RESPONDENT. 3. ! # / CONCERNED CIT 4. # ( ) / THE CIT(A) 5. & ! ! / DR ITAT AHMEDABAD 6. / GUARD FILE . / BY ORDER TRUE COPY / ( DY./ASSTT.REGISTRAR) / ITAT AHMEDABAD 1. DATE OF DICTATION- 23.10.2019.. 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE D ICTATING MEMBER .23.10.2019.. OTHER MEMBER 13.11.2019. 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P.S ./P.S. - 13.11.2019. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DI CTATING MEMBER FOR PRONOUNCEMENT 13.11.2019 5. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK13. 11.2019 6. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 7. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT REGIST RAR FOR SIGNATURE ON THE ORDER 8. DATE OF DESPATCH OF THE ORDER