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TMI Blog2012 (12) TMI 6X X X X Extracts X X X X X X X X Extracts X X X X ..... e basis of the information provided by the assessee during the course of appellate proceedings that investment relates to HUF and not to the individual. AO has treated it as information and not as direction and reassessment proceedings correctly initiated by the AO independently without being influenced by the so called direction of the CIT(A) and purely on the basis of this additional information. 2. Orders in the case of the individual as directed by the ITAT s order have not been passed by the CIT(A) and HUF cannot be absolved of its liability in the case merely on the grounds that earlier orders have been set aside. Income needs to be taxed either in the hand of individual of HUF and both, the individual and HUF cannot be allowed to go scot-free. When the assessee himself has admitted that investments relates to HUF, it needs to be taxed in the hands of the HUF. 2. At the outset, ld. Counsel for the assessee raised preliminary objection that the appeal of the Revenue is not maintainable as tax effect is only Rs.8,832/-. I find that the tax effect in the present appeal, filed by the Revenue, is below prescribed monetary limit and on the issue of monetary limit, the appeal i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... This appeal is by the revenue against the order of the learned CIT(A)-I, Indore, dated 4.3.2010 on the ground that the ld. CIT(A) erred in overlooking the provision of sec. 275(1A) of I.T. Act and deleting penalty u/s 271(1)(c) for Rs.2,32,780/-. 2. During hearing of this appeal, we have heard Shri Pradeep Kuamr Mitra, ld. Sr. DR for the Revenue and Shri S.S. Deshpande, ld. Counsel for the assessee. At the outset, the ld. Counsel for the assessee submitted that the tax effect in the present appeal is below prescribed monetary limit, therefore, straight way, the appeal of the revenue may be dismissed. The ld. Sr. DR fairly admitted that the tax effect is below prescribed monetary limit. 3. We have considered the rival submissions of ld. representatives of both sides and perused the material available on record. Before coming to any conclusion, on the issue of tax effect, the Bench in the case of ACIT vs. M/s. Shriram Nutrients Ltd. in ITA No.123/Ind/2010 (A.Y. 2002-03) vide order dated 28.10.2010 held as under: This appeal is by the revenue against the order of the learned CIT(A)- Ujjain, dated 16.12.2009 on the ground whether in the facts and circumstances of the case, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed respective counsels, we are of the considered opinion that this appeal of the revenue deserves to be dismissed. Our view finds support from the decision dated 2nd December, 2009 of the Tribunal in the case of Himanshu Floor Mills (ITA No. 507/Ind/2009). The relevant portion of the same is reproduced hereunder :- This appeal is by the revenue challenging the order of the CIT(A) dated 26.8.2009. During hearing of this appeal, I have heard Smt. Aparna Karan, learned Senior DR, and nobody was present for the assessee. Registered notice of hearing was sent to the assessee on 11.11.2009. The assessee neither presented itself nor moved any application for adjournment, therefore, I have no option but to proceed ex-parte qua the assessee and dispose of this appeal on the basis of material available in the file. 2. The first ground raised is that the learned first appellate authority erred in deleting the addition of Rs.4,26,936/- made on account of disallowance of depreciation on the fixed assets. On questioning from the Bench about the tax effect, it was fairly pointed out that the tax effect is below the prescribed monetary limit. I have considered the submissions put-forth by t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... missed. The ld. Sr. DR fairly agreed to the submission of the assessee to the extent that the tax effect is below prescribed monetary limit for filing the appeal before the Tribunal. S.No. Authority Monetary limit (In Rs.) 1. ITAT 2,00,000/- 2. Appeal under section 260A before High Court 4,00,000/- 3. Supreme Court 10,00,000/- The Board further clarified the tax effect, which means the 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. However, the tax will not include any interest thereon. In cases of penalty orders, the tax effect will mean quantum of penalty deleted or reduced in the order to be appealed against. In the present appeal, the total disputed addition is Rs.3,94,732/-, therefore, as agreed/canvassed by ld. representatives from both sides, the tax effect is below Rs.2 lakhs, the limit prescribed for filing appeal before the Tribunal, therefore, appeal of the revenue deserves to be dismissed. Our view finds support from the decision of the Chand ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITO must allow set off even if it is not claimed by the assessee because a duty is cast upon the ITO to apply the relevant provisions of the Indian Incometax Act for the purpose of determining the true figure of assessee s taxable income and the consequential tax liability. 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. In view of these facts and judicial pronouncements, I have found no infirmity in the impugned order, consequently, this ground of the revenue also fails. 6. In the result, the appeal of the revenue is dismissed. Order pronounced in open Court in the presence of both the parties at the conclusion of hearing on 1.12.2009. In the aforesaid case, the Tribunal has passed a detailed order, therefore, without going into the merits of the case and respectfully following the aforesaid decision, this appeal of the revenue is dismissed. Order pronounced in open Court in the presence of learned representatives of both the sides at the conclusion of hearing on 26th May, 2010. In view of the above, the appeal of the revenue is dismissed. Order pronounced in the open Court i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... decades old references having negligible tax effect. 4. Vide Board Instruction No. 5/2008 dated 15.5.2008 the monetary limit and other conditions for filing the appeal of the department (in Income Tax matters) before the Appellate Tribunal, High Court and Supreme Court was specified. However, in suppression of these instructions, vide Instruction No. 3/2011 dated 9.2.2011 the Board increased the monetary limit as discussed above (table). The Tribunal (Mumbai Bench) in the case of M/s Laxmi J. Jewel Private Limited (ITA No. 2165/Mum/2010) by following the decision in the case of Hon ble Bombay High Court in CIT v. Madhukar K. Inamdar (HUF) wherein it was held that the Circular will be applicable to the cases pending before the Court either for admission or for final disposal and held that Instruction No. 3 dated 9.2.2011 is applicable for the appeal preferred by the revenue and dismissed the same on tax effect by further considering the decision in the case of Living Stones Jewellery Private Limited vs. DCIT; 31 SOT 323. Respectfully following the aforesaid decisions, we dismiss the appeal of the revenue on the issue of tax effect/monetary limit. 4. There is uncontroverted fac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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