2020 (2) TMI 1436 - AT - Income Tax

Maintainability of appeal on low tax effect - according to the Tribunal, the tax effect on relief granted by the CIT(A) was less than the monetary limit provided by the Circular, hence appeal was dismissed as not maintainable - assessees have claimed bogus LTCG/STCG through penny stock - HELD THAT - During the course of hearing, assessee sought an adjournment on the ground that he would like to submit the details that no bogus Long Term Capital Gain was claimed by the assessee and the hearing was adjourned to 17/04/2020. However, after sometime, before raising the Court, he submitted that assessee would like to take benefit of new Kar Vivad Samadhan Scheme introduced two-three days back and therefore he has no objection if this miscellaneous application is allowed.

Issues:
1. Dismissal of Revenue's appeal based on CBDT Circular
2. Clarification regarding applicability of Circular on cases involving bogus LTCG/STCG
3. Request for recall of Tribunal's order
4. Decision to recall the order and restore the appeal for hearing

Issue 1: Dismissal of Revenue's appeal based on CBDT Circular
The Revenue's appeal was dismissed by the Tribunal as the tax effect on relief granted by the CIT(A) was less than the monetary limit specified in the CBDT Circular dated 08/08/2019. The Circular stated that if the tax effect is below ?50 lakhs, the Revenue would not file an appeal. Consequently, the Tribunal found the appeal not maintainable under the Circular.

Issue 2: Clarification regarding applicability of Circular on cases involving bogus LTCG/STCG
Subsequent to the issuance of the Circular, the Revenue highlighted that the Circular would not apply to cases where assessees have claimed bogus LTCG/STCG through penny stock. This clarification was provided by the Board through Circulars dated 06/09/2019 and 16/09/2019. In light of this clarification, the Revenue filed a miscellaneous application seeking the recall of the Tribunal's order.

Issue 3: Request for recall of Tribunal's order
During the hearing, the counsel for the assessee initially sought an adjournment to provide details proving that no bogus Long Term Capital Gain was claimed. However, later, the counsel informed the Court that the assessee intended to avail the benefits of the new Kar Vivad Samadhan Scheme and had no objection to allowing the miscellaneous application filed by the Revenue.

Issue 4: Decision to recall the order and restore the appeal for hearing
Considering the submissions made by both the counsel for the assessee and the Revenue, the Tribunal decided to recall the order passed in ITA No.948/Ahd/2019 for AY 2014-15 dated 14/08/2019. The appeal was restored to its original number, and the Registry was directed to list it for hearing on 27/04/2020. No separate notice was to be issued as the hearing date was communicated to both parties.

In conclusion, the miscellaneous application filed by the Revenue was allowed, and the order was pronounced in the Court on 10-02-2020 at Ahmedabad.

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