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TMI Blog2015 (8) TMI 470X X X X Extracts X X X X X X X X Extracts X X X X ..... against advertisements of liquor for sales promotion. Therefore, it is essentially a matter of selection of manufacturers and brands which should not involve any payment of commission because the sole purchaser in Kerala happens to be a Government company. The Tribunal allowed the appeals following the orders of earlier years, which, though was challenged in this Court was not considered on merits for the reason that the department did not press the appeals. We do not think the claim can be allowed on a regular basis merely because it was allowed in one year or for several years. If a mistake has happened, it can always be corrected in a subsequent assessment. Therefore, we feel matters require critical examination by the assessing officer. The assessee should be given full opportunity to give the entire details of the expenditure claimed under commission payments or if marketing expenses incurred are claimed as commission, the details thereof. We, therefore, allow the appeals by setting aside the orders of the Tribunal and that of the 1st appellate authority and remand the matter to the assessing officer to decide the matter afresh after giving opportunity to the assessee - D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 519 (Bom) and Commissioner of Income Tax v. Madhukar K. Inamdar (HUF) (2009) 318 ITR 419 (Bom). Reference was also made on the judgments of the High Court of Punjab and Haryana in Commissioner of Income Tax v. Abhinash Gupta (2010) 327 ITR 619 and the judgment of the Madras High Court in Commissioner of Income Tax v. Nagaraja Rao and Others (2009) 318 ITR 422 (Mad). Counsel also brought to our notice the judgment of the Apex Court in State of Kerala and others v. Kurian Abraham Private Limited and Others (2008) 303 ITR 284 (SC) to contend that the Instructions are binding on all authorities of the Department. 4. On the other hand, learned Senior Counsel appearing for the Revenue contended that as is evident from the Instruction itself the applicability thereof should be judged with reference to the Instruction in force as on the date of filing of the appeals. According to him, therefore, Instruction No.5/2014 issued on the 10th of July 2014 cannot have any impact on these appeals which were filed in 2001, 2003 and 2006. Counsel also invited our attention to the principles laid by this Court in the judgment in Commissioner of Income Tax v. Smt. Pushpa Vijoy and Another (201 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeals have been filed before 10th July, 2014 will be governed by the instructions on this subject, operative at the time when such appeal was filed. 8. Reading of paragraph 3 makes it explicitly clear that the direction of the Board is that henceforth appeal shall not be filed in cases where the tax effect does not exceed the monetary limits prescribed in the Instruction. Evidently, therefore, the operation of the Instruction is only prospective. This position is made further clear in Clause 11 of the Instruction which clarified that the Instruction will apply to appeals filed on or after 10th of July 2014 only. It is again clarified that the cases where appeals have been filed before 10th of July 2014 will be governed by the Instructions on this subject, operative at the time when such appeals were filed. 9. Even in respect of plenary law,it is trite that when the language used by the Legislature is clear and unambiguous courts are bound to literally interpret the same. We see no reason why that principle should not be imported for the interpretation of this Instruction as well. Thus seen, the language used by the Board in paragraphs 3 and 11 which are extracted above ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ery well take judicial notice of the fact that by passage of time, money value has gone down, the cost of litigation expenses has gone up, the assessees on the file of the Department have increased; consequently, the burden on the Department has also increased to a tremendous extent. The corridors of the superior Courts are choked with huge penalty of cases. In this view of the matter, the Board has rightly taken a decision not to file references if the tax effect is less than ₹ 2 lakhs. The same policy for old matters need to be adopted by the Department. In our view, the Board's circular dated 27th March, 2000 is very much applicable even to the old references which are still undecided. The Department is not justified in proceeding with the old references wherein the tax impact is minimal. Thus, there is no justification to proceed with decades old references having negligible tax effect. 13. In so far as the Instruction No.1979 dated 27th March 2000 is concerned, Clause 7 of the Instruction only provided that this Instruction will come into effect from 1st April, 2000. Unlike in the case of Instruction No.5/2014, the language of the Instruction was not very clear ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fect is less than ₹ 4 lakhs. In our view, there is no logic behind this belief entertained by the Revenue. 8. This Court can very well take judicial notice of the fact that by passage of time money value has gone down, the cost of litigation expenses has gone up, filing of cases at the instance of Revenue has increased; consequently, the burden on the Department has also increased to a tremendous extent. The corridors of the superior Courts are choked with huge pendency of cases. The litigation expenses have also increased manifold. In this view of the matter, the Board has rightly taken decision not to file appeals if the tax effect is less than ₹ 4 lakhs so as to reduce burden of the Department as well as that of the Tribunals and Courts. The same policy for old matters needs to be adopted by the Department so as to achieve the object of the policy laid down by the CBDT. 9. It would be in the public interest if the Revenue concentrates on the cases wherein tax effect is substantially high rather than running after the assessees wherein the tax impact is less than ₹ 4 lakhs considering the cost of litigation and other administrative cost which may be much m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ee the appeals when these appeals were filed. We find that ITA 153/2001 and 50/2002 concerning the assessment years 1991-1992 and 1992-1993 were filed on 9.10.2001. ITA 171/2001 concerning the assessment year 1994-95 was filed on 10.10.2001. ITA 30/07 concerning the assessment year 2002-2003 was filed on 14.12.2006. ITA Nos.172/08 and 5/09 concerning the assessment years 1995-1996 and 1996-97 were filed on 4.9.2003. This, therefore, means that Instruction 5/2014 dated 10th July 2014, which have come into effect from the date of its issue, has no relevance in so far as these appeals are concerned. Therefore, the contentions raised by the learned counsel for the respondent assessee is only to be rejected and we do so. 20. The alternative contention raised by learned Senior Counsel for the assessee was that in ITA 50/02 concerning the assessment year 1992-1993, even if the Instruction 1979 dated 27th March 2000 is applied the tax effect is much less than the prescribed minimum and, therefore, the appeal cannot be maintained. It was in answer to this plea that the learned Senior Counsel for the Revenue referred us to the Apex Court judgment in Commissioner of Income Tax v. Surya Her ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hould allow the claim only on being satisfied about the genuineness of the claim and the purpose for which commission was paid. The contention of the Revenue is that liquor distribution in the State is the monopoly of the sole marketing agency, which is the KSBC, a wholly owned Kerala Government company. Accordingly, there is no scope for paying any commission for the sale of liquor to a Government company. We find force in this contention because, collection of commission or incentive if any by a Government company or its employees would amount to a corrupt practice. There is prohibition against advertisements of liquor for sales promotion. Therefore, it is essentially a matter of selection of manufacturers and brands which should not involve any payment of commission because the sole purchaser in Kerala happens to be a Government company. The Tribunal allowed the appeals following the orders of earlier years, which, though was challenged in this Court was not considered on merits for the reason that the department did not press the appeals. We do not think the claim can be allowed on a regular basis merely because it was allowed in one year or for several years. If a mistake ha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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