2019 (8) TMI 1661 - AT - Income Tax

Maintainability of appeal - low tax effect - HELD THAT - In this case, as per the return of income filed by the assessee, income declared was ₹ 2,38,10,300/- and assessed income was ₹ 3,22,27,430/- after making addition of ₹ 84,17,130/-. This addition has been deleted by ld. CIT(A) and against the same, the appeal was filed by the revenue and the C.O. is filed by the assessee which is merely in support of the order of ld. CIT(A). As per the latest notification issued by CBDT, no appeal is required to be filed by the revenue before the Tribunal if the tax effect is below ₹ 50 Lakhs and since in the present case, the tax effect is below ₹ 50 Lakhs, the appeal of the revenue is not maintainable because of low tax. This is by now a settled position of law that CBDT instruction is applicable to the pending appeals also and hence, this appeal of the revenue is dismissed because of low tax effect. The C.O. filed by the assessee is in support of the order of ld. CIT(A) and since, the appeal of the revenue is dismissed as not maintainable, the C.O. is also not maintainable and dismissed accordingly.

Summary

Issues involved:
Appeal by revenue against order of CIT(A) for Assessment Year 2012-13, Deletion of addition by CIT(A), Maintainability of appeal by revenue due to low tax effect, Maintainability of Cross Objection (C.O.) by assessee.

Analysis:

1. Deletion of Addition by CIT(A):
- The appeal was filed by the revenue against the order of the ld. CIT(A) for Assessment Year 2012-13. The assessee had declared an income of ?2,38,10,300, which was assessed at ?3,22,27,430 after an addition of ?84,17,130. However, the CIT(A) deleted this addition. Both sides were heard, and it was noted that the tax effect in this case was below ?50 Lakhs. As per CBDT notification, no appeal is required to be filed by the revenue before the Tribunal if the tax effect is below ?50 Lakhs. Therefore, the appeal of the revenue was dismissed by the Tribunal due to the low tax effect. The Cross Objection filed by the assessee was in support of the CIT(A)'s order. Since the appeal by the revenue was dismissed, the C.O. was also not maintainable and was dismissed accordingly.

2. Maintainability of Appeal by Revenue:
- The Tribunal highlighted that CBDT instruction regarding the tax effect being below ?50 Lakhs is applicable to pending appeals as well. Therefore, in this case, as the tax effect was below the specified threshold, the appeal filed by the revenue was considered not maintainable and was dismissed on this ground.

3. Maintainability of Cross Objection (C.O.) by Assessee:
- The Cross Objection filed by the assessee was found to be merely in support of the order of the CIT(A). Since the appeal by the revenue was dismissed due to low tax effect, the C.O. was also considered not maintainable and dismissed accordingly.

In conclusion, the Tribunal dismissed both the appeal filed by the revenue and the Cross Objection filed by the assessee due to the low tax effect, as per the CBDT notification. The decision was based on the settled position of law that the CBDT instruction applies to pending appeals as well. The order was pronounced in the open court on the mentioned date.