Smt Jyoti Agrawal, Bhopal v. The A C I T,

ITSSA 91/IND/2009 | 2006-2007
Pronouncement Date: 21-07-2011 | Result: Allowed

Appeal Details

RSA Number 9122716 RSA 2009
Assessee PAN AEEPA9283A
Bench Indore
Appeal Number ITSSA 91/IND/2009
Duration Of Justice 2 year(s) 14 day(s)
Appellant Smt Jyoti Agrawal, Bhopal
Respondent The A C I T,
Appeal Type Income Tax (Search & Seizure) Appeal
Pronouncement Date 21-07-2011
Appeal Filed By Assessee
Order Result Allowed
Bench Allotted DB
Tribunal Order Date 21-07-2011
Date Of Final Hearing 05-05-2011
Next Hearing Date 05-05-2011
Assessment Year 2006-2007
Appeal Filed On 07-07-2009
Judgment Text
1 IN THE INCOME TAX APPELLATE TRIBUNAL INDORE BENCH INDORE BEFORE SHRI JOGINDER SINGH JUDICIAL MEMBER AND SHRI R.C. SHARMA ACCOUNTANT MEMBER IT(SS)A NOS.82 83 AND 91/IND/2009 AYS: 2003-04 2004-05 AND 2006-07 SMT. JYOTI AGRAWAL BHOPAL PAN AEEPA 9283A ..APPELLANT V/S. ASSTT. COMMISSIONER OF INCOME TAX 1(2) BHOPAL ..RESPONDENT IT(SS) A NOS. 89 AND 90/IND/2009 A.YS. 2006-07 AND 2005-06 ASSTT. COMMISSIONER OF INCOME TAX 1(2) BHOPAL ..APPELLANT VS SMT. JYOTI AGRAWAL BHOPAL ..RESPONDENT 2 ASSESSEE BY : SHRI PRAKASH JAIN FCA REVENUE BY : SHRI DARSHAN SINGH CIT DR ORDER PER JOGINDER SINGH JUDICIAL MEMBER THESE ARE THE CROSS-APPEALS BY THE ASSESSEE AND THE REVENUE AGAINST THE ORDERS OF THE LEARNED COMMISSIO NER OF INCOME TAX (APPEALS) DATED 30.3.2009 AND 27.4.20 09 ON THE FOLLOWING GROUNDS :- 1. THAT THE IMPUGNED ORDER IS BASED UPON INCORRECT INTERPRETATION OF LAW AND FACTS AND THE ORDER PASSE D U/S 153A/143(3) IS WITHOUT JURISDICTION AS THERE WA S NO SEARCH WARRANT IN THE NAME OF THE ASSESSEE NEITHER BEFORE INVOKING THE PROVISIONS OF SECTION 153C AS NO SATISFACTION WAS RECORDED BY THE ASSESSING OFFICER DURING THE COURSE OF SEARCH U/S 132 NOR ANY PAPER/DOCUMENT AND OTHER ASSETS BELONGING TO THE ASSESSEE WAS FOUND FROM THE PREMISES OF THE PERSON SEARCHED. 3 2. THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN UPHOLDING IN RESPECT OF DISALLOWANCE OF ENTIRE AMOUNT OF SALARY OF RS.2 50 000/- RS. 4 39 530/- PAID TO THE EMPLOYEE WITHOUT APPRECIATING THE FACTS AND SUBMISSIONS OF THE ASSESSEE. 3. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LEARNED COMMISSIONER OF INCOME-TAX (APPEALS) ERRED IN DELETING THE ADDITION OF RS.10 52 643/- OU T OF THE TOTAL ADDITION OF RS. 1169603/- AND RS. 84 631/- RESPECTIVELY MADE ON ACCOUNT OF LOAN AND ADVANCES TO THE DIRECTORS AND SUBSTANTIAL SHARE HOLDERS U/S 2(24)(IV) AND SECTION 2(22)(E) OF THE A CT. 4. DELETING THE ADDITION OF RS. 3 LACS MADE ON ACCOUNT OF UNEXPLAINED INVESTMENT IN PURCHASE OF PLOT AT RATANPUR AND THE ADDITION OF RS. 11 LACS MADE ON ACCOUNT OF UNEXPLAINED INCOME FROM KITTY PARTY. 4 5. MAKING THE ADDITION TO THE EXTENT OF RS.1 16 960/- BY INVOKING THE PROVISIONS OF SECTION 2(24(IV) BY CALCULATING THE NOTIONAL INTEREST AT THE RATE OF 10 %. 6. FURTHER ERRED IN MAKING DISALLOWANCE OF RS.1 90 818/- OUT OF INTEREST PAID ON BORROWED CAPITAL WITHOUT APPRECIATING THE NATURE OF TRANSACTIONS/FACTS. 2. DURING HEARING OF THESE APPEALS THE LD. COUNSEL FOR THE ASSESSEE STRONGLY CONTENDED THAT NEITHER ANY SE ARCH WARRANT WAS EXECUTED IN THE NAME OF THE ASSESSEE NO R ANY PANCHNAMA WAS PREPARED IN THE NAME OF THE ASSESSEE FOR WHICH OUR ATTENTION WAS INVITED TO THE COPY OF PANCHNAMA SUPPLIED BY THE DEPARTMENT VIDE LETTER DATED 14 TH FEBRUARY 2011. THEREFORE IT WAS CONTENDED THAT THE ASSESSMENT MADE U/S 153A/143(3) IS LIABLE TO BE QUASHED FOR WHICH RELIANCE WAS PLACED UPON THE FOLLOWING DECISIONS :- (I) MANISH MAHESHWARI V. ACIT AND INDORE CONSTRUCTION V. CIT (2007) 289 ITR 341 (SC) 5 (II) DCIT V. SUBHASHCHANDRA GUPTA HUF ITA NOS. 49 T O 52/IND/09 FOR THE ASSESSMENT YEARS 1999-2000 2001-02 2003-04 AND 2004-05 ORDER DATED 23.7.2009. (III) DCIT V. VISION HOUSING FINANCE PVT. LTD.; ITA NOS. 261 TO 266/IND/08 ORDER DATED 13.3.2009. (IV) JINDAL STAINLESS LIMITED V. ACIT (2009) 122 TT J (DEL) 902. 3. IN THE APPEAL OF THE REVENUE I.E. IT(SS) A NO. 89/IND/2009 AND IT(SS)A NO. 90/IND/2009 IT WAS CONTENDED BY THE LD. COUNSEL FOR THE ASSESSEE THAT THE TAX EFFECT IS LESS THAN RS. 3 LACS THEREFORE AS P ER CBDT INSTRUCTION NO. 3/2011 DATED 9.2.2011 AND THE DECIS ION OF THE HONBLE JURISDICTIONAL HIGH COURT IN CIT V. ASHOKKUMAR MANIBHAI PATEL; 317 ITR 286 (MP) AND ALS O THE DECISION OF THE INDORE BENCH OF THE TRIBUNAL IN NATHULAL JAIN; ITA NO. 475/IND/2010 DATED 29.6.2011 THE APPEALS OF THE REVENUE ARE LIABLE TO BE DISMISS ED ON THE ISSUE OF TAX EFFECT ONLY. 4. ON THE OTHER HAND THE LEARNED CIT DR DEFENDED T HE IMPUGNED ORDER BY CONTENDING THAT THE ASSESSMENT WA S LEGALLY MADE BY SUBMITTING THAT SINCE THE ASSESSEE IS THE 6 WIFE OF SHRI PRAGATI AGRAWAL SHE IS AUTOMATICALLY INCLUDED. 5. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATER IAL AVAILABLE ON RECORD. BRIEF FACTS ARE THAT THE SEAR CH U/S 132 WAS CARRIED OUT AT THE PREMISES OF SHRI PRAGATI AGRAWAL HUSBAND OF THE ASSESSEE ON 16.9.2005. TH E ASSESSEE AN INDIVIDUAL DERIVES INCOME FROM SALARY FROM M/S MECHMEN MOTORS PRIVATE LIMITED SHARE INCOME AN D INTEREST ON CAPITAL FROM PARTNERSHIP BUSINESS. DUR ING SEARCH CERTAIN DOCUMENTS WERE SEIZED FROM THE PREM ISES OF THE HUSBAND OF THE ASSESSEE IN WHOSE NAME THE SE ARCH WARRANT WAS ISSUED. WE HAVE PERUSED THE COPY OF TH E PANCHNAMA (PAGE 4 OF THE PAPER BOOK) WHICH IS CLEAR INDICATIVE OF THE FACT THAT THE WARRANTS WERE ISSUE D IN THE NAME OF SHRI PRAGATI AGRAWAL. DURING HEARING ON EA RLIER 7 DATES THE LD. COUNSEL FOR THE ASSESSEE CONTENDED T HAT IN SPITE OF REQUEST THE COPY OF THE PANCHNAMA WAS NOT SUPPLIED TO THE ASSESSEE. HOWEVER PURSUANT TO THE ORDER OF THE TRIBUNAL THE DCIT VIDE ORDER DATED 14.2.201 1 SUPPLIED THE COPY TO THE ASSESSEE WHEREIN IT IS VER Y MUCH CLEAR THAT THE WARRANTS WERE ISSUED IN THE NAME OF SHRI PRAGATI AGRAWAL AND THE PANCHNAMA WAS ALSO PREPARED IN THE NAME OF SHRI PRAGATI AGRAWAL. UNDER THE FAC TS NARRATED ABOVE NOW THE QUESTION ARISES AS TO WHETH ER THE ASSESSMENT WAS VALIDLY MADE U/S 153A/143(3) OF THE ACT? BEFORE COMING TO ANY CONCLUSION WE ARE REPRODUCING HEREUNDER THE RELEVANT PORTION OF SECTI ON 153A OF THE ACT :- ASSESSMENT IN CASE OF SEARCH OR REQUISITION. 153A. [(1)] NOTWITHSTANDING ANYTHING CONTAINED IN SECTION 139 SECTION 147 SECTION 148 SECTION 149 SECTION 151 AND SECTION 153 IN THE CASE OF A PERSON WHERE A SEARCH IS INITIATED UNDER SECTION 132 OR BOOKS OF ACCOUNT OTHER DOCUMENTS OR ANY ASSETS ARE REQUISIT IONED UNDER SECTION 132A AFTER THE 31ST DAY OF MAY 2003 THE ASSESSING OFF ICER SHALL (A) ISSUE NOTICE TO SUCH PERSON REQUIRING HIM TO FURNISH WITHIN SUCH PERIOD AS MAY BE SPECIFIED IN THE NOTICE THE RETU RN OF INCOME IN RESPECT OF EACH ASSESSMENT YEAR FALLING WITHIN SIX ASSESSMENT YEARS REFERRED TO IN CLAUSE (B) IN THE PRESCRIBED FORM AND VERIFIED IN THE PRESCRIBED MANNER AND SETTING FORTH SUCH OTHER PARTICULARS AS MAY BE PRESCRIBED AND THE PROVISIONS OF THIS ACT SHALL SO FAR AS MAY BE APP LY ACCORDINGLY AS IF SUCH RETURN WERE A RETURN REQUIRED TO BE FURNISHED UNDER SECTION 139 ; 8 (B) ASSESS OR REASSESS THE TOTAL INCOME OF SIX AS SESSMENT YEARS IMMEDIATELY PRECEDING THE ASSESSMENT YEAR RELEVANT TO THE PREVIOUS YEAR IN WHICH SUCH SEARCH IS CONDUCTED OR REQUISITION IS MADE : PROVIDED THAT THE ASSESSING OFFICER SHALL ASSESS OR REASSESS THE TOTAL INCOME IN RESPECT OF EACH ASSESSMENT YEAR FALLING W ITHIN SUCH SIX ASSESSMENT YEARS: PROVIDED FURTHER THAT ASSESSMENT OR REASSESSMENT IF ANY RELATING T O ANY ASSESSMENT YEAR FALLING WITHIN THE PERIOD OF SIX AS SESSMENT YEARS REFERRED TO IN THIS [SUB-SECTION] PENDING ON THE DATE OF INI TIATION OF THE SEARCH UNDER SECTION 132 OR MAKING OF REQUISITION UNDER SECTION 132A AS THE CASE MAY BE SHALL ABATE. [(2) IF ANY PROCEEDING INITIATED OR ANY ORDER OF A SSESSMENT OR REASSESSMENT MADE UNDER SUB-SECTION (1) HAS BEEN AN NULLED IN APPEAL OR ANY OTHER LEGAL PROCEEDING THEN NOTWITHSTANDING A NYTHING CONTAINED IN SUB-SECTION (1) OR SECTION 153 THE ASSESSMENT OR REASSESSMENT RELATING TO ANY ASSESSMENT YEAR WHICH HAS ABATED UNDER THE SECO ND PROVISO TO SUB- SECTION (1) SHALL STAND REVIVED WITH EFFECT FROM T HE DATE OF RECEIPT OF THE ORDER OF SUCH ANNULMENT BY THE COMMISSIONER: PROVIDED THAT SUCH REVIVAL SHALL CEASE TO HAVE EFFECT IF S UCH ORDER OF ANNULMENT IS SET ASIDE.] EXPLANATION.FOR THE REMOVAL OF DOUBTS IT IS HEREB Y DECLARED THAT (I) SAVE AS OTHERWISE PROVIDED IN THIS SECTION SECTION 153B AND SECTION 153C ALL OTHER PROVISIONS OF THIS ACT SHALL APPLY TO T HE ASSESSMENT MADE UNDER THIS SECTION; (II) IN AN ASSESSMENT OR REASSESSMENT MADE IN RES PECT OF AN ASSESSMENT YEAR UNDER THIS SECTION THE TAX SHALL BE CHARGEABL E AT THE RATE OR RATES AS APPLICABLE TO SUCH ASSESSMENT YEAR. IF THE LANGUAGE USED IN THE AFORESAID SECTION IS ANALYSED IT CLEARLY SPEAKS ABOUT FRAMING OF ASSESSMENT U/S 153A OF THE ACT IN THE HANDS OF PERSON WHO HAS BEEN SEARCHED U/S 132 OF THE ACT AND IN WHOSE NAME THE AUTHORISATION IS ISSUED. IN CASE NO SEARCH IS CONDUCTED NO ASSESSMENT CAN BE FRAMED U/S 153A OF THE ACT 9 MERELY ON THE PLEA THAT SOME DOCUMENTS WERE SEIZED FROM THE PREMISES OF SEARCHED PERSON WHO IS OTHER THAN THE ASSESSEE. IN THE ABSENCE OF SEARCH IN THE CASE OF THE ASSESSEE THERE BEING NO SEARCH WARRANT OR AUTHORISATION IN THE NAME OF THE ASSESSEE WE ARE OF THE VIEW THAT PRE-REQUISITES OF SECTION 153A OF THE ACT ARE NOT FULFILLED. THEREFORE NO ASSESSMENT COULD BE MADE UNDER SECTION 153A OF THE ACT. THE RATIO LAID DOWN IN THE FOLLOWING CASES FURTHER FORTIFIES THE CASE OF THE ASSESSEE :- 1. ADDL. CIT VS. RADHEY SHYAM JAGDISH (1979) 9 CTR (ALL) 143 : (1979) 117 ITR 186 (ALL) 2. ASSTT.CIT V. DALAMAL & SONS INV.CO.(1993) 46 TTJ (BOM) 143 3. ATUL TRADERS V. ITO (2006) 200 CTR (ALL) 71 : (2 006) 282 ITR 536 (ALL) 4. C. VASANTLAL & CO. VS. CIT (1962) 45 ITR 206 (SC ) 5. CHUHARMAL V. CIT (1988) 70 CTR (SC) 88: (1988) 1 72 ITR 250(SC) 6. CIT V. DURGA PRASAD MORE; 1973 CTR (SC) 500 (197 1) 82 ITR 540(SC) 7. CIT VS. EASTERN COMMERCIAL ENTERPRISES(1995) 123 CTR (CAL) 217: (1994) 210 ITR 103 (CAL) 8. CIT V. S.M. AGGARWAL (2007) 211 CTR (DEL) 180 : (2007) 293 ITR 43 (DEL) 9. CIT VS. SMT.K.C.AGNES (2003) 183 CTR (KER) 29 (2 003) 262 ITR 354(KER) 10. CIT VS. TIRUPATI OIL CORPN. (2001) 167 CTR (BOM ) 77 : (2001) 248 ITR 194 (BOM) 10 11. FOOD CORPORATION OF INDIA VS. PROVIDENT FUND CO MMR.(1990) 1 SCC 68 12. GORDHANDAS HARGOVANDAS & ANR. VS. CIT (1979) 12 CTR (BOM) 19 : (1980) 126 ITR 560 (BOM) 13. K.P. VARGHESE VS. ITO (1981) 24 CTR (SC) 358: ( 1981) 131 ITR 597 (SC) 14. KIRLOSKAR INVESTMENTS & FINANCE LTD. VS. ASSTT. CIT (1998) 67 ITD 504 (BANG.) 15. MANGE RAM MITTAL VS. ASSTT.CIT (2006) 105 TTJ ( DEL) (SB) 594 16. MOHD. USIF AIR 1968 BOMBAY 112 17. MUNNALAL MURLIDHAR V. CIT (1971) 79 ITR 540 (AL L) 18. NATHURAM WELJIBHAI VYAS V. MRS. LAXMIBAI LUNKAR ANJI CHANDAK (1983) 139 ITR 948 (BOM) 19. NENMAL SHANKARLAL PARMER VS. ASSTT.CIT(INV.) (1 992) 102 CTR (KAR.)64 : (1992) 195 ITR 582 (KAR.) 20. RAMJI DAS DAYA WALA & SONS (P) LTD. V. INVERT I MPORT AIR 1981 SC 2085 21. RUDRACHAR VS. DIRECTOR OF IT (INV) (2002) 178 C TR (KAR) 314 : (2002) 257 ITR 549 (KAR.) 22. SMT. SITA DEVI VS. CIT (1979) 12 CTR (P&H) 108 : (1980) 122 ITR 105 (P&H) 23. UNION OF INDIA VS. T.R. VERMA (1958) SCR 499 24. VASANJI GHELA & CO. VS. CST 40 STC 544 25. MANISH MAHESHWARI V. ACIT AND INDORE CONSTRUCT ION V. CIT (2007) 289 ITR 341 (SC) 26. DCIT V. SUBHASHCHANDRA GUPTA HUF ITA NOS. 49 TO 52/IND/09 FOR THE ASSESSMENT YEARS 1999-2000 2001-02 2003-04 AND 2004-05 ORDER DATED 23.7.2009. 27. DCIT V. VISION HOUSING FINANCE PVT. LTD.; ITA N OS. 261 TO 266/IND/08 ORDER DATED 13.3.2009. 28. JINDAL STAINLESS LIMITED V. ACIT (2009) 122 TTJ (DEL) 902. 7. IN VIEW OF THE FACTS AND THE JUDICIAL PRONOUNCEMENT S (SUPRA) NO ASSESSMENT U/S 153A COULD BE MADE. CONSEQUENTLY THE ASSESSMENTS SO MADE ARE QUASHED. 11 SINCE THE ASSESSMENTS HAVE BEEN QUASHED WE NEED NO T DEAL WITH OTHER GROUNDS OF APPEAL TAKEN BEFORE US. 8. SO FAR AS THE APPEAL OF THE REVENUE IS CONCERNED SINCE WE HAVE QUASHED THE ORDER PASSED BY THE ASSES SING OFFICER U/S 153A OF THE ACT ON JURISDICTIONAL ISSUE THEREFORE FOLLOWING THE SAME REASONING THE REVENU E HAS NO LEGS TO STAND AND THE SAME IS DISMISSED. 8.1 SO FAR AS IT(SS)A NO. 90/IND/2009 IS CONCERNED WE FIND THAT IN THIS APPEAL OF REVENUE THE TAX EFFECT IS LESS THAN THE PRESCRIBED MONETARY LIMIT F OR WHICH THE DEPARTMENT IS NOT SUPPOSED TO FILE THE APPEAL. OUR VIEW IS SUPPORT BY THE DECISION OF THE TRIBUNAL IN THE CASE OF M.S. SIDDIQU AND BALJI OIL INDUSTIRES ETC. (ITA NOS. 480/IND/2010 TO 557/IND/2010 ORDER DATED 30.6.2011). THE RELEVANT PORTION OF THE SAME IS REPRODUCED HEREUNDER :- 12 THE ABOVE APPEALS ARE FILED BY THE REVENUE AGAINST THE DIFFERENT ORDERS OF THE LD. CIT(A) FOR THE DIFFERENT ASSESSME NT YEARS AS MENTIONED ABOVE. 2. DURING HEARING OF THESE APPEALS THE LD. COUNSEL S FOR RESPECTIVE ASSESSEES CONTENDED THAT THE TAX EFFECT IN THE PRESENT APPEALS IS BELOW THE PRESCRIBED LIMIT THEREFORE T HE THESE APPEALS OF THE REVENUE DESERVES TO BE DISMISSED ON THIS COUNT ITSELF BY FURTHER SUBMITTING THAT NO APPEAL CAN BE FILED BEFORE THE T RIBUNAL WHICH IS HAVING THE TAX EFFECT LESS THAN RS. 3 LACS. THIS FA CTUAL MATRIX WAS FAIRLY CONSENTED BY THE LEARNED SR. DR BUT SUBMITTE D THAT THE CIRCULAR OF CBDT IS EFFECTIVE ONLY IN RESPECT OF AP PEALS FILED AFTER 9.2.2011 THEREFORE THE SUBMISSION OF THE ASSESSEE S IS NOT TENABLE IN RESPECT OF THE APPEALS WHEREIN THE TAX EFFECT IS MORE THAN RS.2 LACS AND WHICH HAVE BEEN FILED PRIOR TO 9.2.2011. I N REPLY THE LD. COUNSELS FOR RESPECTIVE ASSESSEE CONTENDED THAT IDE NTICALLY THE HONBLE JURISDICTIONAL HIGH COURT HAS HELD THAT IT IS APPLICABLE TO THE APPEALS WHICH ARE PENDING BEFORE THE TRIBUNAL A ND PLACED RELIANCE UPON THE DECISION IN CIT V. ASHOK KUMAR MA NIBHAI PATEL & COMPANY (2009) 317 ITR 386 (MP) ITO VS. M/S LAXMI JEWELS PRIVATE LIMITED (ITA NO. 2165/MUM/2010). ITAT INDO RE BENCH HAS ALSO FOLLOWED THE ABOVE DECISIONS IN CASE OF CASE O F ACIT VS. NATHULAL JAIN (ITA NO. 475/IND/2010) ORDER DATED 29 .6.2011. THE TRIBUNAL IN THIS ORDER HAS DELIBERATED UPON THE I SSUE OF TAX EFFECT IN DETAIL IN WHICH THE APPEAL OF THE REVENUE WAS DISMISSED BEING TAX EFFECT BELOW PRESCRIBED LIMIT. THE RELEVANT POR TION OF THE SAME IS REPRODUCED HEREUNDER: AGGRIEVED BY THE ORDER DATED 3 RD MARCH 2010 OF LEARNED COMMISSIONER OF INCOME TAX (APPEALS) THE REVENUE I S IN APPEAL ON THE GROUND THAT LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN DELETING THE ADDITION OF RS. 7 85 000/- OU T OF TOTAL ADDITION OF RS. 8 85 000/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNEXPLAINED LOAN CREDIT U/S 68 OF THE ACT WHEREAS T HE ASSESSEE HAS FILED THE CROSS OBJECTION ON THE GROUND THAT LEARNE D COMMISSIONER OF INCOME TAX (APPEALS) WAS NOT JUSTIFIED IN CONFIR MING THE ACTION OF THE ASSESSING OFFICER IN RESPECT OF THE ADDITION OF RS. 1 LAC MADE U/S 68 OF THE ACT WITHOUT CONSIDERING THE FACTS OF THE CASE AND SUBMISSIONS MADE BEFORE HIM. 2. DURING HEARING OF THIS APPEAL THE LD. COUNSEL F OR ASSESSEE CONTENDED THAT THE TAX EFFECT IN THE PRESENT APPEAL IS BELOW THE PRESCRIBED LIMIT THEREFORE THE APPEAL OF THE REVE NUE DESERVES TO BE DISMISSED ON THIS COUNT ITSELF BY FURTHER SUBMITTIN G THAT THE TAX EFFECT IS RS. 2 52 450/- AND NO APPEAL CAN BE FILED BEFORE THE TRIBUNAL WHICH IS HAVING THE TAX EFFECT LESS THAN R S. 3 LACS. THIS FACTUAL MATRIX WAS FAIRLY CONSENTED BY THE LEARNED SR. DR BUT SUBMITTED THAT THE CIRCULAR OF CBDT IS EFFECTIVE FR OM A PARTICULAR DATE THEREFORE THE SUBMISSION OF THE ASSESSEE IS NOT TENABLE. IN REPLY THE LD. COUNSEL FOR ASSESSEE CONTENDED THAT IDENTICALLY THE HONBLE JURISDICTIONAL HIGH COURT HAS HELD THAT IT IS APPLICABLE TO 13 THE APPEALS WHICH ARE PENDING BEFORE THE TRIBUNAL A ND PLACED RELIANCE UPON THE DECISION IN CIT V. ASHOK KUMAR MA NIBHAI PATEL & COMPANY (2009) 317 ITR 386 (MP) ITO VS. M/S LAXMI JEWELS PRIVATE LIMITED (ITA NO. 2165/MUM/2010). 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PE RUSED THE MATERIAL AVAILABLE ON FILE. UNDISPUTEDLY THE TAX EFFECT IN THE PRESENT APPEAL IS BELOW THE PRESCRIBED MONETARY LIMIT IN FI LING THE APPEAL BEFORE THE TRIBUNAL. THEREFORE WE ARE REPRODUCING HEREUNDER THE DECISION OF THE TRIBUNAL IN THE CASE OF RAJAN CLOTH STORES (ITA NO. 365/IND/2010) ORDER DATED 31.5.2011 :- THIS APPEAL IS BY THE REVENUE AGAINST THE ORDER OF THE LEARNED CIT(A)-I INDORE DATED 4.3.2010 ON THE GROUND THAT THE LD. C IT(A) ERRED IN OVERLOOKING THE PROVISION OF SEC. 275(1A) OF I.T. A CT AND DELETING PENALTY U/S 271(1)(C) FOR RS.2 32 780/-. 2. DURING HEARING OF THIS APPEAL WE HAVE HEARD SHR I PRADEEP KUAMR MITRA LD. SR. DR FOR THE REVENUE AND SHRI S.S. DES HPANDE LD. COUNSEL FOR THE ASSESSEE. AT THE OUTSET THE LD. COUNSEL FOR TH E ASSESSEE SUBMITTED THAT THE TAX EFFECT IN THE PRESENT APPEAL IS BELOW PRESC RIBED MONETARY LIMIT THEREFORE STRAIGHT WAY THE APPEAL OF THE REVENUE MAY BE DISMISSED. THE LD. SR. DR FAIRLY ADMITTED THAT THE TAX EFFECT IS B ELOW PRESCRIBED MONETARY LIMIT. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATERIAL AVAILABLE ON RE CORD. BEFORE COMING TO ANY CONCLUSION ON THE ISSUE OF TAX EFFECT THE BEN CH IN THE CASE OF ACIT VS. M/S. SHRIRAM NUTRIENTS LTD. IN ITA NO.123/IND/2010 (A.Y. 2002-03) VIDE ORDER DATED 28.10.2010 HELD AS UNDER: THIS APPEAL IS BY THE REVENUE AGAINST THE ORDER O F THE LEARNED CIT(A)- UJJAIN DATED 16.12.2009 ON THE GROUND WHETHER IN T HE FACTS AND CIRCUMSTANCES OF THE CASE LD. CIT(A) ERRED IN TREA TING THE ASSESSMENT MADE BY THE A.O. AS INFRUCTUOUS WITHOUT APPRECIATI NG THE FACT THAT OTHERWISE ON 6.3.2006 (THE DATE OF ISSUE OF NOTICE) THE A.O. WAS EMPOWERED TO ISSUE NOTICE U/S 148 FOR THE A.Y. 2002 -03 IN VIEW OF THE PROVISIONS OF SECTION 149(1)(A) READ WITH SECTION 1 51(1) OF THE IT ACT 1961? 2. DURING HEARING OF THIS APPEAL WE HAVE HEARD SHR I S.S. DESHPANDE LD. COUNSEL FOR THE ASSESSEE AND SHRI P. K. MITRA LEARNED SENIOR DR. THE CRUX OF ARGUMENT IS THAT THE TAX EFF ECT IN THE PRESENT APPEAL IS BELOW MONETARY PRESCRIBED LIMIT THEREFORE STRA IGHT WAY THE APPEAL OF THE REVENUE MAY BE DISMISSED. THE LD. SR. DR SHRI P.K. MITRA FAIRLY ADMITTED THAT THE TAX EFFECT IS BELOW PRESCRIBED MONETARY LI MIT. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATERIAL AVAILABLE ON RE CORD. IN THE PRESENT APPEAL THE INCOME ASSESSED IS RS.1 37 880/- AND TH E TAX INVOLVED IS RS.40 611/- ONLY THEREFORE WITHOUT GOING INTO MER ITS OF THE CASE ON THE PRIMARY OBJECTION OF MONETARY LIMIT THE APPEAL OF THE REVENUE DESERVES TO BE DISMISSED. OUR VIEW IS SUPPORTED BY THE DECISION OF THE TRIBUNAL IN HIMANSHU FLOUR MILLS (ITA NO.506/IND/2009 ORDER DA TED 26.5.2010). THE RELEVANT PORTION OF THE SAME IS REPRODUCED HEREUNDE R: 14 THIS APPEAL IS BY THE REVENUE AGAINST THE ORDER OF THE LEARNED CIT(A) DATED 26.8.2009 ON THE GROUND THAT THE LEARNED COMM ISSIONER OF INCOME TAX (APPEALS) WAS NOT JUSTIFIED IN DELETING THE ADD ITION OF RS. 5 46 831/- MADE BY THE ASSESSING OFFICER ON ACCOUNT OF DISALLO WANCE OF DEPRECIATION ON FIXED ASSETS AND ALSO IN DIRECTING THE ASSESSING OFFICER TO ALLOW CARRY FORWARD OF BROUGHT FORWARD LOSSES OF EARLIER YEARS. 2. DURING HEARING OF THIS APPEAL WE HAVE HEARD THE LEARNED COUNSELS FROM BOTH THE SIDES AND CONSIDERED THE ARGUMENTS AD VANCED BY THEM. AT THE OUTSET THE LD. COUNSEL FOR THE ASSESSEE RAISED A PRELIMINARY OBJECTION THAT SINCE THE TAX EFFECT IS BELOW THE PRESCRIBED M ONETARY LIMIT THEREFORE THE DEPARTMENT IS NOT PERMITTED TO FILE THIS APPEAL AND THE SAME DESERVES TO BE DISMISSED ON THIS SHORT GROUND ITSELF. HOWEVER THE LEARNED SR. DR FAIRLY AGREED THAT THE TAX EFFECT IS BELOW PRESCRIBED MONE TARY LIMIT. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS OF LD. REPRESENTATIVES OF BOTH SIDES AND PERUSED THE MATERIAL AVAILABLE ON RE CORD. IN VIEW OF THE ABOVE ASSERTION OF THE LEARNED RESPECTIVE COUNSELS WE ARE OF THE CONSIDERED OPINION THAT THIS APPEAL OF THE REVENUE DESERVES TO BE DISMISSED. OUR VIEW FINDS SUPPORT FROM THE DECISION DATED 2 ND DECEMBER 2009 OF THE TRIBUNAL IN THE CASE OF HIMANSHU FLOOR MILLS (ITA NO. 507/IND/2009). THE RELEVANT PORTION OF THE SAME IS REPRODUCED HEREUNDER :- THIS APPEAL IS BY THE REVENUE CHALLENGING THE ORD ER OF THE CIT(A) DATED 26.8.2009. DURING HEARING OF THIS APPEAL I HAVE H EARD SMT. APARNA KARAN LEARNED SENIOR DR AND NO-BODY WAS PRESENT FOR THE ASSESSEE . REGISTERED NOTICE OF HEARING WAS SENT TO THE ASSESSEE ON 11.11.2009. THE ASSESS EE NEITHER PRESENTED ITSELF NOR MOVED ANY APPLICATION FOR ADJOURNMENT THEREFORE I HAVE NO OPTION BUT TO PROCEED EX-PARTE QUA THE ASSESSEE AND DISPOSE OF THIS APPEA L ON THE BASIS OF MATERIAL AVAILABLE IN THE FILE. 2. THE FIRST GROUND RAISED IS THAT THE LEARNED FIRS T APPELLATE AUTHORITY ERRED IN DELETING THE ADDITION OF RS.4 26 936/- MADE ON ACCO UNT OF DISALLOWANCE OF DEPRECIATION ON THE FIXED ASSETS. ON QUESTIONING F ROM THE BENCH ABOUT THE TAX EFFECT IT WAS FAIRLY POINTED OUT THAT THE TAX EFFE CT IS BELOW THE PRESCRIBED MONETARY LIMIT. I HAVE CONSIDERED THE SUBMISSIONS PUT-FORTH BY THE LEARNED SENIOR DR AND PERUSED THE MATERIAL AVAILABLE ON RECORD. 3. BRIEF FACTS ARE THAT THE ASSESSEE CLAIMED DEPREC IATION OF RS. 8 53 871/- ON THE FIXED ASSETS. THE LEARNED ASSESSING OFFICER BASED UPON THE COMMENTS OF THE AUDITORS IN THE NOTES TO ACCOUNTS AND THE NATURE OF THE BUSINESS DISALLOWED 50% OF THE DEPRECIATION CLAIMED BY THE ASSESSEE WHICH WAS WORKED OUT AT RS.4 26 936/-. BEFORE THE LEARNED FIRST APPELLATE AUTHORITY THE SU BMISSION OF THE ASSESSEE WAS THAT THE FIXED ASSETS WERE DULY REFLECTED IN THE BA LANCE SHEET DURING THE RELEVANT PERIOD AND THERE WAS NO NEW ADDITION IN THE ASSETS. THE DEPRECIATION ON ALL THE ASSETS WAS REGULARLY ALLOWED SINCE THE DATE OF INCL USION IN THE BALANCE SHEET. EVEN IN THE IMPUGNED ORDER THERE IS A FACTUAL FINDING TH AT THE ASSESSEE FROM THE DATE OF INCLUSION HAS NOT SHOWN IN ADDITION TO THE BLOCK OF ASSETS AS THE WDV AS ON 31.3.2002 WAS TAKEN AS BASIS AFTER REDUCING THE SAL E OF SOME ASSETS FOR THE CALCULATION OF ALLOWABLE DEPRECIATION FOR THE ASSES SMENT YEAR 2003-04 AND THE ASSESSEE WAS ALLOWED DEPRECIATION FOR THE ASSESSMEN T YEAR 2002-03. THE REVENUE HAS NOT ADDUCED ANY EVIDENCE CONTROVERTING THE FACT UAL FINDING MENTIONED IN THE IMPUGNED ORDER THEREFORE THE DISALLOWANCE IS DESI RABLE IN THE IMPUGNED APPEAL. EVEN OTHERWISE ON THE TAX EFFECT THIS APPEAL OF THE REVENUE IS LIABLE TO BE 15 DISMISSED. THIS VIEW FINDS SUPPORT FROM THE DECISIO N OF THE TRIBUNAL IN THE CASE OF R.K. HOTELS (ITA NO.383/IND/09). THE RELEVANT PORTI ON OF THE ORDER IS REPRODUCED HEREUNDER :- THIS APPEAL IS BY THE REVENUE AGAINST THE ORDER O F LD. CIT-(A)-II BHOPAL DATED 31.3.2009 FOR THE AY 2005-06 ON THE GROUND TH AT THE LD. FIRST APPELLATE AUTHORITY ERRED IN DELETING THE ADDITION OF 6 37 206/- MADE BY THE AO BY APPLYING THE PROVISIONS OF SEC. 154(3) ON ACC OUNT OF INCORRECTNESS AND INCOMPLETENESS OF BOOKS OF ACCOUNT.. 2. DURING HEARING OF THE APPEAL WE HAVE HEARD SMT. APARNA KARAN LD. SR. DR AND SHRI H.P. VERMA ALONG WITH SHRI ASHI SH GOYAL LD. COUNSEL FOR ASSESSEE. AT THE OUTSET IT WAS POINTED OUT THA T THERE IS TYPOGRAPHICAL ERROR IN MENTIONING THE FIGURE OF RS.6 37 206/- IN THE GROUND OF APPEAL AS THE CORRECT FIGURE IS RS.3 94 732/-. THE ASSERTION OF THE ASSESSEE WAS CONSENTED TO BE CORRECT BY THE LD. SR. DR. FURTHER IT WAS POINTED OUT THAT THE TAX EFFECT IS ALSO BELOW MONETARY LIMIT THEREF ORE THE APPEAL OF THE REVENUE MAY BE DISMISSED. THE LD. SR. DR FAIRLY AGR EED TO THE SUBMISSION OF THE ASSESSEE TO THE EXTENT THAT THE TAX EFFECT I S BELOW PRESCRIBED MONETARY LIMIT FOR FILING THE APPEAL BEFORE THE TRI BUNAL. S.NO. AUTHORITY MONETARY LIMIT (IN RS.) 1 ITAT 2 00 000/- 2 APPEAL UNDER SECTION 260A BEFORE HIGH COURT 4 00 000/- 3 SUPREME COURT 10 00 000/- THE BOARD FURTHER CLARIFIED THE TAX EFFECT WHICH M EANS THE DIFFERENCE BETWEEN THE TAX ON THE TOTAL INCOME ASSESSED AND TH E TAX THAT WOULD HAVE BEEN CHARGEABLE HAD SUCH TOTAL INCOME BEEN REDUCED BY THE AMOUNT OF INCOME IN RESPECT OF THE ISSUE AGAINST WHICH APPEAL IS INTENDED TO BE FILED. HOWEVER THE TAX WILL NOT INCLUDE ANY INTEREST THER EON. IN CASES OF PENALTY ORDERS THE TAX EFFECT WILL MEAN QUANTUM OF PENALTY DELETED OR REDUCED IN THE ORDER TO BE APPEALED AGAINST. IN THE PRESENT APPEAL THE TOTAL DISPUTED ADDITION IS RS.3 94 732/- THEREFORE AS A GREED/CANVASSED BY LD. REPRESENTATIVES FROM BOTH SIDES THE TAX EFFECT IS BELOW RS.2 LAKHS THE LIMIT PRESCRIBED FOR FILING APPEAL BEFORE THE TRIBUNAL T HEREFORE APPEAL OF THE REVENUE DESERVES TO BE DISMISSED. OUR VIEW FINDS S UPPORT FROM THE DECISION OF THE CHANDIGARH BENCH OF THE TRIBUNAL IN THE CASES OF SHRI J.S. LUTHRA (ITA NO.712 TO 715/CHD/2009) AND ITO WARD 2 (2) ROPAR VS. THE JHALLIAN KALAN PRI. COOP MILK PRODUCE SOCIETY LTD. JHALLIAN KALAN DISTT. ROPAR (ITA NO.721/CHD/2009). THEREFORE WITHOUT GOI NG INTO THE MERITS OF 16 THE CASE FACTS AND THE JUDICIAL PRONOUNCEMENTS (SU PRA) THIS APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES OF BOTH SIDES ON 6.10.2009. IN THE LIGHT OF THE ABOVE THIS GROUND OF THE REVEN UE IS HAVING NO MERIT THEREFORE THE STAND OF THE LEARNED CIT(A) IS AFFIRMED CONSEQE NTLY THIS GROUND OF THE REVENUE IS DISMISSED. 4. THE NEXT GROUND RAISED IS THAT THE LEARNED FIRST APPELLATE AUTHORITY ERRED IN DIRECTING THE ASSESSING OFFICER TO ALLOW CARRY FORW ARD OF BROUGHT FORWARD LOSSES OF EARLIER YEARS WITHOUT ANY BASIS. THE CONTENTION RA ISED ON BEHALF OF THE REVENUE IS THAT IN COMING TO A PARTICULAR CONCLUSION NO BASIS HAS BEEN ADDUCED BY THE LEARNED FIRST APPELLATE AUTHORITY AND IT WAS RIGHTL Y DISALLOWED BY THE ASSESSING OFFICER IN THE ABSENCE OF PROOF FURNISHED BY THE AS SESSEE. 5. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PERU SED THE MATERIAL AVAILABLE ON RECORD. THE STAND OF THE REVENUE IS THAT PROOF OF LAST YEARS LOSSES WAS NOT FURNISHED BY THE ASSESSEE CONSEQUENTLY THESE ARE NO T ALLOWABLE WHEREAS BEFORE THE LEARNED FIRST APPELLATE AUTHORITY THERE IS A FA CTUAL FINDING THAT IN ALL PREVIOUS YEARS RETURNS WERE DULY FILED BY THE ASSESSEE AND THE SAME WERE AVAILABLE ON RECORD OF THE ASSESSING OFFICER. IN THE IMPUGNED OR DER THE LEARNED FIRST APPELLATE AUTHORITY HAS DIRECTED THE ASSESSING OFFICER TO ALL OW CARRY FORWARD OF BROUGHT FORWARD LOSSES OF EARLIER YEARS WHICH WERE NOT SET OFF AFTER VERIFICATION OF RECORDS OF EARLIER YEARS. EVEN OTHERWISE IT IS A CASE OF ASSESSED LOSS WHICH HAS NOT BEEN SET OFF. CONSEQUENTLY WE ARE IN AGREEMENT THAT IN VIEW OF THE PROVISIONS OF SECTION 72 IT SHOULD BE ALLOWED. CONSEQUENTLY THE RE IS NO GRIEVANCE TO THE REVENUE SINCE IT HAS BEEN REMANDED BACK TO THE FILE OF THE ASSESSING OFFICER TO DO THE NEEDFUL AFTER VERIFICATION OF RECORDS OF EARLIE R YEARS. MY VIEW FINDS SUPPORT FROM THE RATIO LAID DOWN IN CIT V. J.H. GOTLA; 156 ITR 323 (SC); TARA DEVI BEHL V. CIT; 218 ITR 541 (P&H). THE HONBLE APEX COURT IN THE CASE OF CIT V. MAHALAXMI SUGAR MILLS CO. LTD.; 160 ITR 920 EVEN WENT TO THE EXTENT THAT ITO MUST ALLOW SET OFF EVEN IF IT IS NOT CLAIMED BY THE ASSESSEE BECAU SE A DUTY IS CAST UPON THE ITO TO APPLY THE RELEVANT PROVISIONS OF THE INDIAN INCOMET AX ACT FOR THE PURPOSE OF DETERMINING THE TRUE FIGURE OF ASSESSEES TAXABLE I NCOME AND THE CONSEQUENTIAL TAX LIABILITY. MERELY BECAUSE THE ASSESSEE FAILS TO CLA IM THE BENEFIT OF SET OFF CANNOT RELIEVE THE ITO OF HIS DUTY TO APPLY SECTION 72 IN AN APPROPRIATE CASE. IN VIEW OF THESE FACTS AND JUDICIAL PRONOUNCEMENTS I HAVE FOU ND NO INFIRMITY IN THE IMPUGNED ORDER CONSEQUENTLY THIS GROUND OF THE REVENUE ALS O FAILS. 6. IN THE RESULT THE APPEAL OF THE REVENUE IS DISM ISSED. ORDER PRONOUNCED IN OPEN COURT IN THE PRESENCE OF BOTH THE PARTIES AT THE CONCLUSION OF HEARING ON 1.12.2009. IN THE AFORESAID CASE THE TRIBUNAL HAS PASSED A DE TAILED ORDER THEREFORE WITHOUT GOING INTO THE MERITS OF THE CASE AND RESPECTFULLY FOLLOWING THE AFORESAID DECISION THIS APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT IN THE PRESENCE OF LEARNED REPRESENTATIVES OF BOTH THE SIDES AT THE CONCLUSION OF HEARING ON 26 TH MAY 2010. 17 IN VIEW OF THE ABOVE THE APPEAL OF THE REVENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES OF BOTH THE SIDES AT THE CONCLUSION OF THE HEARING ON 28.10.2010. 4. HOWEVER THE CBDT VIDE INSTRUCTION NO.3/2011 DAT ED 9.2.2011 REVISED/RAISED THE MONETARY LIMIT FOR FILING THE AP PEAL BY THE DEPARTMENT AS UNDER: THE ABOVE INSTRUCTIONS ARE APPLICABLE TO THE APPEAL S FILED ON OR AFTER 9.2.2011 ISSUED U/S 268A(1) OF THE I.T. ACT 1961. AS FAR AS THE MERIT OF THE CASE IS CONCERNED IT HAS ALREADY BEEN EXAMINED BY THE LD. CIT(A) BY KEEPING THE PROVISIONS OF SEC. 275(1)(A) OF THE ACT . SINCE THE APPEAL OF THE ASSESSEE WAS DECIDED BY THE LD. CIT(A) VIDE ORDER D ATED 4.11.2004 CONSEQUENTLY THE PENALTY PROCEEDINGS WERE SUPPOSED TO BE DISPOSED OF BY 31.3.2006 WHEREAS THE SAME WAS DECIDED VIDE ORDER D ATED 22.4.2009. IN VIEW OF THIS FACT THE ORDER WAS RIGHTLY QUASHED C ONSEQUENTLY WE FIND NO INFIRMITY IN THE STAND OF THE LD. CIT(A). THE SAME IS UPHELD. ORDER PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES OF BOTH THE SIDES AT THE CONCLUSION OF THE HEARING ON 31.5.2011. IDENTICALLY THE BENCH IN THE CASE OF VINOD BANSAL ITA NO. 275/IND/2010 VIDE ORDER DATED 22.6.2011 DISMISSED T HE APPEAL OF THE REVENUE ON THE ISSUE OF TAX EFFECT. THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT V. ASHOK KUMAR MANIBH AI & COMPANY (2009) 317 ITR 386 HELD AS UNDER :- THIS COURT CAN VERY WELL TAKE JUDICIAL NOTICE OF T HE FACT THAT BY PASSAGE OF TIME MONEY VALUE HAS GONE DOWN THE COST OF LITIGATION EXPENSES HAS GONE UP THE ASSESSEE ON THE FILE OF T HE DEPARTMENT HAVE BEEN INCREASED CONSEQUENTLY THE BURDEN ON THE DEPARTMENT HAS ALSO INCREASED TO A TREMENDOUS EXTENT. THE CORRIDOR S OF THE SUPERIOR COURTS ARE CHOKED WITH HUGE PENDENCY OF CASES. IN THIS VIEW OF THE MATTER THE BOARD HAS RIGHTLY TAKEN A DECISION NOT TO FILE REFERENCES IF THE TAX EFFECT LESS THAN RS. 2 LAKHS. THE SAME POLI CY FOR OLD MATTERS NEEDS TO BE ADOPTED BY THE DEPARTMENT. IN OUR VIEW THE BOARDS CIRCULAR DATED MARCH 27 2000 IS VERY MUCH APPLICAB LE EVEN TO THE OLD REFERENCES WHICH ARE STILL UNDECIDED. THE DEPARTME NT IS NOT JUSTIFIED S.NO. AUTHORITY MONETARY LIMIT (IN RS.) 1 ITAT 3 00 000/- 2 APPEAL UNDER SECTION 260A BEFORE HIGH COURT 10 00 000/- 3 SUPREME COURT 25 00 000/- 18 IN PROCEEDING WITH THE OLD REFERENCE WHEREIN THE TA X IMPACT IS MINIMAL. THUS THERE IS NO JUSTIFICATION TO PROCEED WITH DECADES OLD REFERENCES HAVING NEGLIGIBLE TAX EFFECT. 4. VIDE BOARD INSTRUCTION NO. 5/2008 DATED 15.5.200 8 THE MONETARY LIMIT AND OTHER CONDITIONS FOR FILING THE APPEAL OF THE DEPARTMENT (IN INCOME TAX MATTERS) BEFORE THE APPEL LATE TRIBUNAL HIGH COURT AND SUPREME COURT WAS SPECIFIED. HOWEVER IN SUPPRESSION OF THESE INSTRUCTIONS VIDE INSTRUCTION NO. 3/2011 DATED 9.2.2011 THE BOARD INCREASED THE MONETARY LIM IT AS DISCUSSED ABOVE (TABLE). THE TRIBUNAL (MUMBAI BENCH) IN THE CASE OF M/S LAXMI J. JEWEL PRIVATE LIMITED (ITA NO. 2165/MUM/20 10) BY FOLLOWING THE DECISION IN THE CASE OF HONBLE BOMBA Y HIGH COURT IN CIT V. MADHUKAR K. INAMDAR (HUF) WHEREIN IT WAS HEL D THAT THE CIRCULAR WILL BE APPLICABLE TO THE CASES PENDING BE FORE THE COURT EITHER FOR ADMISSION OR FOR FINAL DISPOSAL AND HELD THAT INSTRUCTION NO. 3 DATED 9.2.2011 IS APPLICABLE FOR THE APPEAL P REFERRED BY THE REVENUE AND DISMISSED THE SAME ON TAX EFFECT BY FUR THER CONSIDERING THE DECISION IN THE CASE OF LIVING STONES JEWELLERY PRIVATE LIMITED VS. DCIT; 31 SOT 323. RESPECTFULLY FOLLOWING THE AF ORESAID DECISIONS WE DISMISS THE APPEAL OF THE REVENUE ON THE ISSUE OF TAX EFFECT/MONETARY LIMIT. ORDER PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LEARNED REPRESENTATIVES OF BOTH THE SIDES AT THE CONCLUSION OF THE HEARING ON 30 TH JUNE 2011. WE FIND FROM THE RECORD THAT ITA NO. 87/IND/2011 8 8/IND/2011 617/IND/2010 104/IND/2011 524/IND/2010 598/IND/2 010 599/IND/2010 620/IND/2010 556/IND/2010 & IT(SS)A NO. 26/IND/2011 ARE HAVING TAX EFFECT BELOW RS.2 LACS A ND REMAINING THREE APPEALS I.E. ITA NO.480/IND/2010 102/IND/201 1 & 571/IND/2010 ARE HAVING TAX EFFECT MORE THAN RS.2 L ACS BUT BELOW RS.3 LACS. SO FAR AS THE APPEALS HAVING TAX EFFECT BELOW RS.2 LACS ARE CONCERNED SAME ARE DISMISSED BEING NOT MAINTAI NABLE AS PER EARLIER CIRCULAR NO.5/2008 DATED 15.5.2008 OF CBDT WHEREAS WITH REGARD TO THREE APPEALS HAVING TAX EFFECT MORE THAN RS.2 LACS BUT LESS THAN RS.3 LACS ARE CONCERNED WE FIND THAT THE SE APPEALS ARE ALSO LIABLE TO BE DISMISSED BEING NOT MAINTAINABLE BY FOLLOWING THE DECISION OF MUMBAI BENCH IN THE CASE OF LAXMI JEWEL S P. LTD. ORDER DATED 12.4.2011 ITA NO.2165/MUM/2010. THIS ORDER OF THE MUMBAI BENCH HAS BEEN SUBSEQUENTLY FOLLOWED IN THE CASE OF M/S. INDIA SAFETY VAULTS LTD. ORDER DATED 29.4.2011 IN ITA NO.648 TO 651/MUM/2010. WE HAVE CAREFULLY GONE THROUGH THE DE CISION OF THE COORDINATE BENCH WHEREIN AFTER FOLLOWING THE DECISI ON OF HONBLE BOMBAY HIGH COURT IN THE CASE OF MADHUKAR K. INAMDA R HUF IT WAS HELD THAT CIRCULAR WILL BE APPLICABLE TO THE CA SE PENDING BEFORE COURT EITHER FOR ADMISSION OR FOR FINAL DISPOSAL. I N THE CASE OF NATHULAL JAIN (SUPRA) THE TRIBUNAL HAS PASSED A DE TAILED ORDER THEREFORE WITHOUT GOING INTO THE MERITS OF THE RES PECTIVE CASES AND RESPECTFULLY FOLLOWING THE AFORESAID DECISION ALL THE PRESENT APPEALS OF THE REVENUE ARE DISMISSED BEING TAX EFFECT BELOW PRESCRIBED LIMIT. 19 ORDER PRONOUNCED IN THE OPEN COURT IN THE PRESENCE OF LD. REPRESENTATIVES OF BOTH SIDES AT THE CONCLUSION OF THE HEARING ON 30.6.2011. IN VIEW OF THE ABOVE THE APPEALS OF THE ASSESSEE A RE ALLOWED AND THAT OF THE REVENUE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 21 ST JULY 2011. SD/- SD/- (R.C. SHARMA) (JOGINDER SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 21.7.2011 COPY TO:APPELLANT/RESPONDENT/CIT/CIT(A)/DR/GUARD FI LE D/-