ACIT, Circle - 34, Kolkata, Kolkata v. M/s. B.M.S. International, Kolkata

ITA 1716/KOL/2010 | 2004-2005
Pronouncement Date: 29-03-2011

Appeal Details

RSA Number 171623514 RSA 2010
Bench Kolkata
Appeal Number ITA 1716/KOL/2010
Duration Of Justice 6 month(s) 27 day(s)
Appellant ACIT, Circle - 34, Kolkata, Kolkata
Respondent M/s. B.M.S. International, Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 29-03-2011
Appeal Filed By Department
Bench Allotted C
Tribunal Order Date 29-03-2011
Assessment Year 2004-2005
Appeal Filed On 02-09-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL BEN CH C KOLKATA () BEFORE SHRI MAHAVIR SINGH JUDICIAL MEMBER. /AND . .. . ! ! ! !. .. . '# SHRI C.D.RAO ACCOUNTANT MEMBER $ $ $ $ / ITA NO . 1716/KOL/2010 %& '(/ ASSESSMENT YEAR : 2004-05 (*+ / APPELLANT ) A.C.I.T. CIRCLE-34 KOLKATA - % - - VERSUS - . (-.*+/ RESPONDENT ) M/S. B.M.S.INTERNATIONAL (PAN: AA // B 0967 N) *+ 0 1 '/ FOR THE APPELLANT: SHRI GOUTAM MONDAL -.*+ 0 1 '/ FOR THE RESPONDENT: SHRI S.M.SURANA '2 / ORDER ( (( ( . .. . ! ! ! !. .. . ) )) ) '# PER SHRI C.D.RAO AM THIS APPEAL IS FILED BY THE REVENUE AGAINST THE OR DER DATED 14.06.2010 OF THE CIT(A)-XX KOLKATA PERTAINING TO A.YR. 2004-05. 2. IN THIS CASE THE REVENUE IS IN APPEAL DISPUTING THE DELETION OF ADDITION OF RS.7 69 990/- MADE BY THE AO ON ACCOUNT OF BOGUS PU RCHASES. 3. AT THE TIME OF HEARING THE LD. COUNSEL APPEARIN G ON BEHALF OF THE ASSESSEE AT THE OUTSET SUBMITTED THAT IN THIS CASE THE TAX EFFECT I NVOLVED IS RS.2 76 250/- AND SINCE THE TAX EFFECT IS LESS THAN RS. 3 LAKHS AS PER CBDT INS TRUCTION NO.3/2011(F.NO.279/MISE/142/2007-ITJ) DATED 9.2.201 1 WHEREIN IT HAS BEEN ENHANCED THE LIMITS FOR FILING OF APPEALS BEFORE TH E TRIBUNAL TO RS.3 LAKHS THE REVENUES APPEAL IS LIABLE TO BE DISMISSED IN LIMIN E. IN VIEW OF THE LATEST ORDER OF THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS DELH I RACE CLUB IN ITA NO.128/2008 WHEREIN THE HONBLE HIGH COURT OPINED THAT THAT THE CIRCULAR WOULD ALSO APPLY TO THE 2 PENDING CASES. THEREFORE HE REQUESTED TO DISMISS TH E REVENUE. THE COPY OF HONBLE DELHI HIGH COURT IS PLACED ON RECORD. 5. ON THE OTHER HAND THE LD. DR APPEARING ON BEHAL F OF THE REVENUE CONTENDED THAT IN THIS SAID CIRCULAR IT WAS SPECIFICALLY MENT IONED AT PARA 11 THAT THE CIRCULAR IS EFFECTIVE FOR THE APPEALS FILED SUBSEQUENT TO THE S PECIFIC DATE IN THE CIRCULAR. SINCE THIS APPEAL HAS BEEN FILED PRIOR TO THE ISSUE OF CIRCULA R THE MONETARY LIMIT SPECIFIED IN THE CIRCULAR IS NOT APPLICABLE TO THE PRESENT APPEAL. T HEREFORE HE REQUESTED TO DISPOSE OF ON MERIT. 6. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CAREF UL PERUSAL OF MATERIAL ON RECORD KEEPING IN VIEW OF THE FACT THAT THE LD. DR COULD N OT GIVE CONTRARY JUDGEMENT TO THE ONE ON WHICH THE LD. COUNSEL FOR THE ASSESSE HAS RE LIED WHEREIN THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS DELHI RACE CLUB IN ITA NO.128/2008 DATED 03.03.2011 HAS HELD AS UNDER :- THE TAX EFFECT INVOLVED IN THE PRESENT APPEAL IS R S.4 65 860/-. AS PER THE RECENT GUIDELINES OF THE CBDT APPEAL IN THOSE CASE S WHERE THE TAX EFFECT IS LESS THAN 10 LACS ARE NOT TO BE ENTERTAINED. THIS COURT IN THE CASE OF COMMISSIONER OF INCOME TA X-III V. M/S. P.S.JAIN AND CO. BEING ITA NO.179/1991 DECIDED ON 2 ND AUGUST 2010 HAS TAKEN A VIEW THAT SUCH CIRCULAR WOULD ALSO APPLY TO PENDING CASES. 6.1. ADMITTEDLY THE TAX PAYABLE IN RESPECT OF GROUN DS OF APPEAL BY THE DEPARTMENT IS LESS THAN RS.3 LAKHS AND AS PER REVISED INSTRUCT ION OF THE CBDT NO.3 DATED 9.2.2011. WHEREIN THE CBDT HAS REVISED THE FILING L IMITS FILED BEFORE THE TRIBUNAL HIGH COURT AND SUPREME COURT AS UNDER :- BEFORE THE INCOME TAX APPELLATE TRIBUNAL : RS. 3 L AKHS APPEALS U/S 260A OF THE IT ACT BEFORE THE HONBLE HIGH COURT : RS.10 LAKHS AND BEFORE THE HONBLE SUPREME COURT : RS.25 LAKHS SINCE IN THE PRESENT CASE THE ABOVE REVISED INSTRUC TION IS WELL APPLICABLE IN VIEW OF THE HONBLE DELHI HIGH COURT (SUPRA) HENCE IN OUR OPINI ON THE REVENUES APPEAL IS NOT MAINTAINABLE IN VIEW OF THE SAID CIRCULAR OF THE CB DT. 3 6.2. WE FURTHER FIND THAT IT IS A SETTLED LAW THAT THE CIRCULARS ISSUED BY CBDT ARE BINDING ON THE REVENUE. THIS POSITION WAS CONFIRMED BY THE APEX COURT IN THE CASE OF COMMISSIONER OF CUSTOMS VS INDIAN OIL CORPORATIO N LTD. REPORTED IN 267 ITR 272 WHEREIN THEIR LORDSHIPS EXAMINED THE EARLIER DECISI ONS OF THE APEX COURT WITH REGARD TO BINDING NATURE OF THE CIRCULAR AND LAID DOWN THA T WHEN A CIRCULAR ISSUED BY THE BOARD REMAINS IN OPERATION THEN THE REVENUE IS BOUN D BY IT AND CANNOT BE ALLOWED TO PLEAD THAT IT IS NOT VALID OR THAT IT IS CONTRARY T O THE TERMS OF THE STATUTE. THE APPEAL UNDER CONSIDERATION HAS CERTAINLY BEEN FILED CONTRA RY TO THE CIRCULAR ISSUED BY THE CBDT INSTRUCTION NO.3 DATED 9.2.2011. 6.3. RESPECTFULLY FOLLOWING THE ABOVE DECISION OF T HE HONBLE DELHI HIGH COURT WE HOLD THAT THE APPEAL FILED BY THE DEPARTMENT AG AINST THE IMPUGNED ORDER OF THE LD. CIT(A) IS CONTRARY TO THE POLICY DECISION OF T HE DEPARTMENT AND AS SUCH THE APPEAL FILED BY THE DEPARTMENT IS DISMISSED IN LIMINE . 7. IN THE RESULT THE APPEAL FILED BY THE REVENUE I S DISMISSED. ORDER PRONOUNCED IN THE COURT ON 29.03.2011 SD/- SD/- MAHAVIR SINGH JUDICIAL MEMBER . .. . ! ! ! !. .. . '# '# '# '# C.D.RAO ACCOUNTANT MEMBER. ( (( (!# !# !# !#) )) ) DATE: 29.03.2011 '2 0 -3 4'3'5- COPY OF THE ORDER FORWARDED TO: 1. M/S. B.M.S.INTERNATIONAL 24 ARMENIAN STREET KOLK ATA-700001. 2 THE A.C.I.T. CIRCLE-34 KOLKATA 3. THE CIT 4. THE CIT(A)-XX KOLKATA 5. DR KOLKATA BENCHES KOLKATA .3 -/ TRUE COPY '2%:/ BY ORDER DEPUTY /ASST. REGISTRAR ITAT KOLKATA BENCHES R.G.(.P.S.) 4