9911796707
|
Home
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2021 (2) TMI 346 - AT - Income TaxMaintainability of appeal of revenue on low tax effect - Revenue has pleaded that the assessment was reopened on the basis of the audit objection, and it has been provided in the circular that if the assessment has been reopened on the basis of audit objection, then that appeal against the order of the ld.CIT(A) would be decided on merit instead of dismissing it on tax effect - HELD THAT - Simply the appeal would not be filed because the case falls within the exceptional clause of the CBDT Instruction for not filing the appeal where the tax effect by virtue of relief granted by the CIT(A) is less than the monetary limit for filing such appeals. In other words, the Department has to assess the merits of the dispute involved and they will not file further appeal against the order of the CIT(A) or ITAT in a mechanical manner. Department has not brought any substantial material on the record pointing out that appeal was filed after evaluation of merit on the issues involved. It sought to recall the order of the Tribunal merely on the basis of audit objection, which is not sufficient for recalling the Tribunal order. Therefore, we do not find any error in the order of the Tribunal. Thus the miscellaneous application is rejected.
Issues:
1. Recall of order based on tax effect limit. 2. Exception clause in CBDT Circular. 3. Interpretation of Circulars for filing appeals. 4. Evaluation of merit for appeal filing. Issue 1: Recall of order based on tax effect limit The Revenue filed a Miscellaneous Application seeking the recall of an order dated 15.11.2018, which dismissed the appeal due to the tax effect being less than the prescribed limit. The Revenue contended that the case fell under exception (c) of a specific Circular, as the assessment was reopened based on an Audit Objection. The Departmental Representative argued that the case was covered by the Circular and requested the order's recall. However, the Authorized Representative for the assessee opposed, stating that the Circular was being mechanically interpreted, and appeals should be filed based on merit. The Tribunal considered the submissions and found no error in the original order, rejecting the application for recall. Issue 2: Exception clause in CBDT Circular The Tribunal noted that the Circulars were being misinterpreted, leading to mechanical filing of appeals without proper examination on merit. Reference was made to Circulars clarifying that appeals against adverse judgments should be filed only on merit. The Tribunal cited a case where the Hon'ble Bombay High Court emphasized the need for the Revenue to prove the acceptance of audit objections before seeking a recall. It was concluded that the Revenue failed to provide substantial material to recall the order based solely on an audit objection. Issue 3: Interpretation of Circulars for filing appeals The Tribunal highlighted the importance of evaluating the merit of issues before filing appeals, emphasizing the need to follow Circulars and establish conditions as required. It was observed that the Revenue's attempt to recall the order based on an audit objection alone was insufficient. The Tribunal referenced decisions and Circulars to support the rejection of the application for recall, as the appeal filing lacked proper evaluation of merit. Issue 4: Evaluation of merit for appeal filing The Tribunal further emphasized the necessity for the Revenue to demonstrate that appeals were filed after a thorough evaluation of the case on merit. Despite the Revenue's arguments, no substantial evidence was presented to show that the appeal was filed following a comprehensive assessment of the issues involved. Consequently, the Tribunal dismissed the Miscellaneous Application, as no merit was found in the Revenue's filing based on the evaluation presented during the proceedings.
|
