The Tax Publishers2020 TaxPub(DT) 3712 (Jab-Trib)

INCOME TAX ACT, 1961

Section 254 read with Sections 268A & 147

Where revenue challenged dismissal of its appeals by holding that tax effect was below threshold monetary limit for filing of appeals, and contended that it was covered by exception listed at para 10(c) of its earlier Circular No. 3/2018, dated 11-7-2018,as assessments were made consequent to revenue audit objection, considering fact that even though assessment proceedings were initiated by reason of a revenue audit objection, same was not accepted by AO inasmuch as he was not personally satisfied therewith and thus, clause 10(c) of Board was not applicable because Circular clearly states of revenue audit objection having been accepted by revenue.

Appeal (Tribunal) - Maintainability - Assessment made consequent to revenue audit objection - Exception for filling appeal having lower tax effect

Revenue filed Miscellaneous Applications (MAs) contending that its' appeals were wrongly dismissed as withdrawn/not pressed per order of Tribunal on account of having lower tax effect than prescribed monetary limit. Case of revenue was that even though tax effect was below threshold monetary limit for filing of appeals, it was covered by exception listed at para 10(c) of its earlier Circular No. 3/2018, dated 11-7-2018, in conjunction with which said Circular was to be read. Clause (c) of para 10 speaks of cases covered by the revenue audit objection. According to revenue, since assessments was consequent to an audit objection, revenue's appeals were excepted and, therefore, did not fall under section 268A. Held: Audit objection was toward short accounting of receipt, inferred on basis of TDS certificates, comparing same with books of account of assessee. There was no dispute as to the nature of receipt, but only to the arithmetical accuracy of its accounts, doubted with reference to the TDS certificate/s, which stood duly clarified. It was, therefore, abundantly clear that AO was satisfied with assessee's reply (to audit objection) as to there being no escapement of income, yet proceeded to issue notice under section 148(1), so that same was only due to the non-acceptance of his reply by audit party, i.e., at its insistence. In facts and circumstances of case, assessment proceedings, though initiated by reason of a revenue audit objection, same was not accepted by AO inasmuch as he was not personally satisfied therewith. The terms of clause 10(c) of the Board Circular clearly states of the revenue audit objection having been accepted by revenue. Though words 'has been accepted by the Department' in clause 10(c) carries a broader connotation, i.e., than that of the words 'accepted by the assessing authority', an assessment made in the absence of the personal satisfaction of AO would not survive.

REFERRED : Commr. of Customs (Import), Mumbai v. M/s. Dilip Kumar and Company & Ors. [CA No. 3327 of 2007, dated 30-7-2018] Larsen & Toubro Ltd. v. State of Jharkhand & Ors. [C.A. No. 5390 of 2007, dt. 21-3-2017] Honda Siel Power Products Ltd. v. CIT, Delhi (2007) 295 ITR 466 (SC) : 2007 TaxPub(DT) 1553 (SC) Shree Sajjan Mills Limited v. CIT, M.P. & Anr. (1985) 156 ITR 585(SC) : 1985 TaxPub(DT) 1362 (SC) CIT v. Concord Pharmaceuticals (2009) 317 ITR 395 (Guj) : 2009 TaxPub(DT) 0710 (Guj-HC) Asstt. CIT, Circle 1 (1), Jabalpur, ITO (Exemption), Dy. CIT (TDS), Bhopal v. Shri Sureshchand Jain, Prop. M/s. Vikas Industries, Smt. Gurucharan Kaur Mokha, J.P. Tobacco Prod. (P) Ltd., Smt. Seema Bhattacharya, Smt. Jharna Bhattacharya, Bhaskar Bhattacharya (HUF), Shashi Bhushan Bhattacharya (HUF) AND Others [IT(SS)A No.44/Jab/13, 18-19/Jab/16, ITA No.23/Jab/18, 45/Jab/18, 29/Jab/16, 90/Jab/2015, 151/Jab/2015, 152/Jab/2015, IT(SS) A No.5/Jab/05, ITA No.128/Jab/16, C.O.No. 13/Jab/16 [In ITA No. 128/Jab/16] & Others , dt. 23-8-2019] ITO Ward 3 (2), Ahmedabad v. Dinesh Madhavlal Patel 2019 TaxPub(DT) 5093 (Ahd-Trib) ITO 2 (3) Singrauli v. Dr Asha Gupta [M.A. No.12/JAB/2017 [In ITA No.04/JAB/2017], dt. 24-4-2019]

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