2012 (3) TMI 154 - AT - Income Tax

Appeal to be filed in Tribunal- the limit prescribed for filing appeal before the Tribunal is Rs. 2 Lakhs now increased to 3 Lakhs vide Instruction No. 3/2011 dated 9.2.2011-Difference between the tax on the total income assessed and the 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- - held that - appeals of the Revenue against Ld. CIT(A)are dismissed being not maintainable and the Cross-objections of the assessee are dismissed as not pressed Merely because the assessee fails to claim the benefit of set off cannot relieve the ITO of his duty to apply section 72 in an appropriate case.

Summary

Issues Involved:
1. Tax effect below the prescribed monetary limit.
2. Applicability of CBDT circulars and instructions on monetary limits.
3. Cross-objections filed by the assessee.

Detailed Analysis:

1. Tax Effect Below the Prescribed Monetary Limit:

The Revenue appealed against the orders dated 26.7.2011 for assessment years 2003-04 to 2009-10. The learned counsel for the assessee argued that the tax effect in these appeals was below the prescribed monetary limit, citing the Tribunal's order in the case of Nathulal Jain. The Revenue did not dispute this factual assertion.

The Tribunal considered the rival submissions and noted that the tax effect in the present appeals was indeed below the prescribed monetary limit for filing appeals before the Tribunal. This was supported by several previous decisions where appeals were dismissed on the grounds of low tax effect, including cases like Rajan Cloth Stores, M/s. Shriram Nutrients Ltd., and Himanshu Flour Mills.

2. Applicability of CBDT Circulars and Instructions on Monetary Limits:

The Tribunal referenced CBDT Instruction No. 3/2011 dated 9.2.2011, which revised the monetary limits for filing appeals by the department. The new limits were Rs. 3,00,000 for ITAT, Rs. 10,00,000 for High Court, and Rs. 25,00,000 for the Supreme Court. These instructions were applicable to appeals filed on or after 9.2.2011.

The Tribunal also referred to various judicial pronouncements, including the Hon'ble jurisdictional High Court's decision in CIT v. Ashok Kumar Manibhai Patel & Company, which supported the application of these monetary limits to pending appeals. The Tribunal followed this precedent, dismissing the Revenue's appeals on the grounds of low tax effect.

3. Cross-Objections Filed by the Assessee:

The assessee had filed cross-objections for the same assessment years. However, during the hearing, the learned counsel for the assessee did not press these cross-objections. Consequently, the Tribunal dismissed the cross-objections as not pressed.

Conclusion:

The Tribunal dismissed the Revenue's appeals as not maintainable due to the tax effect being below the prescribed monetary limit. The cross-objections filed by the assessee were also dismissed as not pressed. The order was pronounced in the open Court in the presence of representatives from both sides.