DCIT, Circle - 5, Kolkata, Kolkata v. M/s. Pilani Investment & Industries Corpn. Ltd., Kolkata

ITA 593/KOL/2011 | 2003-2004
Pronouncement Date: 22-07-2011

Appeal Details

RSA Number 59323514 RSA 2011
Assessee PAN AABCP7642R
Bench Kolkata
Appeal Number ITA 593/KOL/2011
Duration Of Justice 3 month(s) 9 day(s)
Appellant DCIT, Circle - 5, Kolkata, Kolkata
Respondent M/s. Pilani Investment & Industries Corpn. Ltd., Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 22-07-2011
Appeal Filed By Department
Bench Allotted A
Tribunal Order Date 22-07-2011
Assessment Year 2003-2004
Appeal Filed On 13-04-2011
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL BEN CH A KOLKATA [ () . .. . ! ! ! !. .. . '# ] ]] ] [BEFORE HONBLE SRI MAHAVIR SINGH JM & HONBLE S RI C. D. RAO AM] % / ITA NO.593/KOL/2011 - &' (' /A.YR.2003-04 )* % / INTT.TAX.A NO.1/KOL/2011 - &' (' /A.YR.1998-1999 )* % / INTT.TAX.A NO.2/KOL/2011 - &' (' /A.YR.1999-2000 D.C.I.T. CIRCLE-5 KOLKATA -&- M/S.PILANI INVESTMENTS & INDUSTRIES -VS- CORPORATION LTD. (PAN:AA BCP 7642 R) ( - / APPELLANT ) (./ -/ RESPONDENT ) - 1 2 '/ FOR THE APPELLANT: SHRI A.K.PRAMANIK ./ - 1 2 '/ FOR THE RESPONDENT: SHRI A.K.GUPTA '3 / ORDER ' 456 ' 456 ' 456 ' 456 PER BENCH THE ABOVE APPEALS ARE FILED BY THE REVENUE AGAINST SEPARATE ORDERS DATED 25.01.2001 & 30.11.2007 RESPECTIVELY OF THE CIT(A)- VI KOLKATA PERTAINING TO A.YRS. 2003-04 1998-99 AND 1999-2000 RESPECTIVELY. 2. THE REVENUE HAS TAKEN THE FOLLOWING GROUNDS OF APPEAL IN A.YR.2003-04 :- 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CAS E THE LD. CIT(A-VI KOLKATA ERRED IN LAW AS WELL AS ON FACTS BY DELETING THE PE NALTY OF RS.50 000/- IMPOSED U/S 271(1)(C) BY HOLDING THE VIEW THAT SINCE THE AM OUNT IS SMALL THE INTENTION OF THE ASSESEE WAS NOT MALAFIDE. 2. THE APPELLANT CRAVES LEAVE TO ADD DELETE OR MOD IFY ANY OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING. A.YRS.1998-99 AND 1999-2000 : 1. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD. CIT(A)-VI KOLKATA HAS ERRED IN LAW AS WELL AS ON FACTS BY DELETING TH E PENALTY U/S 23 OF THE INTEREST TAX ACT BY HOLDING THAT THE ASSESSEE IS A REPUTED C OMPANY AND HENCE THERE IS NO REASON WHY THEY WOULD NOT ATTEND FOR THE INTERES T TAX PROCEEDINGS AND WITHOUT LOOKING INTO THE FACTS OF THE CASE. 2 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE LD. CIT(A)-VI KOLKATA HAS ERRED IN LAW AS WELL AS ON FACTS BY DELETING THE PE NALTY U/S 23 OF THE INTEREST TAX ACT BY OBSERVING THAT THE ITAT HAS DELETED THE ADDITION MADE IN THE ASSESSMENT ORDER WITHOUT CONSIDERING THAT THE PENAL TY WAS IMPOSED FOR NON- COMPLIANCE OF THE NOTICES ISSUED. 3. THAT THE APPELLANT CRAVES FOR LEAVE TO ADD DELE TE OR MODIFY ANY OF THE GROUNDS OF APPEAL BEFORE OR AT THE TIME OF HEARING. 3. AT THE TIME OF HEARING THE LD. AR APPEARING ON BEHALF OF THE ASSESSEE SUBMITTED THAT IN THE ABOVE CASES THE TAX EFFECT IS BELOW RS. 2 LAKHS. THEREFORE AS PER THE INSTRUCTION OF CBDT CIRCULAR THE REVENUE IS BARRED FROM FILING OF THE APPEALS BEFORE THIS TRIBUNAL. 4. THE LD. DR APPEARING ON BEHALF OF THE REVENUE C OULD NOT CONTRADICT THE ABOVE SUBMISSIONS OF THE LD. COUNSEL OF THE ASSESSEE. 5. AFTER HEARING THE RIVAL SUBMISSIONS AND ON CAREF UL PERUSAL OF THE ASSESSMENT ORDER IT IS OBSERVED THAT THE TAX EFFECT IN ALL TH E ABOVE CASES IS BELOW RS.2 LAKHS. 5.1. ADMITTEDLY THE TAX PAYABLE IN RESPECT OF GROUN DS OF APPEAL BY THE DEPARTMENT IS LESS THAN RS.2 LAKHS AND AS PER REVISED INSTRUCT ION OF THE CBDT NO. 279 DATED 24 TH OCTOBER 2005 W.E.F. 31.10.2005 AND SINCE IN THE PR ESENT CASE THE ABOVE REVISED INSTRUCTION OF CBDT IS WELL APPLICABLE AND THEREFOR E IN OUR CONSIDERED OPINION THE REVENUE SHOULD HAVE REFRAINED FROM FILING SECOND AP PEAL BEFORE THE TRIBUNAL. IT WOULD BE APT TO QUOTE THE OBSERVATION OF THE DELHI HIGH C OURT IN THE CASE OF CIT VS.- ITAT 232 ITR 207 AT PAGE 216 AS BELOW :- THE CENTRAL BOARD OF DIRECT TAXES INSTRUCTIONS ARE BINDING ON THE DEPARTMENT. IF THE CASE AT HAND IS C OVERED BY A POLICY LAID DOWN BY THE CENTRAL BOARD OF DIREC T TAXES IN THAT CASE NO FAULT CAN BE FOUND WITH THE ORDER O F THE TRIBUNAL REFUSING TO STATE THE CASE AND THERE IS NO REASON WHY THE HIGH COURT SHOULD INTERFERE WITH SUCH DISCR ETION OF THE TRIBUNAL AS HAS BEEN EXERCISED CONSISTENTLY WIT H THE UNIFORM POLICY LAID DOWN BY THE CENTRAL BOARD OF DI RECT TAXES WHICH BINDS ALL THE SUBORDINATE AUTHORITIES O F THE INCOME TAX DEPARTMENT. THE HIGH COURT WOULD NOT ORDINARILY ENCOURAGE BREACH OF POLICY DECISIONS AND THE DEPARTMENTAL INSTRUCTIONS WHICH HAVE A PUBLIC PURPO SE BEHIND THEM. VALUABLE TIME OF HIGH COURTS AND HIGHL Y PLACED TRIBUNALS IS NOT TO BE WASTED ON PETTY MATTE RS. 3 5.2. FURTHER THE BOMBAY HIGH COURT HAS ALSO HELD I N THE CASE OF CIT VS.- CAMCO COLOUR LTD. (SUPRA) AND IN THE CASE OF PITHWA ENGIN EERING WORKS REPORTED IN 276 ITR 519 MUMBAI THAT THE CIRCULAR IS BINDING ON THE REVE NUE AND AN APPEAL OR REFERENCE CONTRARY TO THE INSTRUCTION ISSUED IN THE CIRCULAR WOULD NOT BE CONSIDERED BY THE COURT. 5.3. 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.5 OF 2008 DATED 15.5.2008. 5.4. IN VIEW OF THE ABOVE WE HOLD THAT THE APPEALS FILED BY THE DEPARTMENT AGAINST THE IMPUGNED ORDER OF THE LD. CIT(A) ARE CONTRARY TO THE POLICY DECISION OF THE DEPARTMENT AND AS SUCH THE APPEALS FILED BY THE DEP ARTMENT ARE DISMISSED IN LIMINE . 6. IN THE RESULT THE APPEALS FILED BY THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 22.07.2011. SD/- SD/- MAHAVIR SINGH JUDICIAL MEMBER . .. . ! ! ! !. .. . '# '# '# '# C.D.RAO ACCOUNTANT MEMBER. ( (( (!# !# !# !#) )) ) DATE: 22.07.2011 R.G.(.P.S.) 4 '3 1 .7 8'7(9- COPY OF THE ORDER FORWARDED TO: 1. M/S. PILANI INVESTMENT & INDUSTRIES CORPORATION LTD . 91/ R.N.MUKHERJEE ROAD BIRLA BUILDING KOLKATA-700001. 2 THE DCIT CIRCLE-5 KOLKATA 3. THE CIT 4. THE CIT(A)-VI KOLKATA 5. DR KOLKATA BENCHES KOLKATA /7 ./ TRUE COPY '3&>/ BY ORDER DEPUTY /ASST. REGISTRAR ITAT KOLKATA BENCHES