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TMI Blog2018 (8) TMI 1627X X X X Extracts X X X X X X X X Extracts X X X X ..... ellate stage. Accordingly, this issue is decided in favour of the assessee Disallowance u/s 14A - assessee has argued that the claim of the assessee be restricted to the extent of exempt income - Held that:- In view of the submission made by the assessee and in view of the law settled in case of Joint Investment Private Limited [2015 (3) TMI 155 - DELHI HIGH COURT] we restricted the expenses incurred to earn the exempt income to the extent of dividend income i.e. to the tune of ₹ 1,12,500/-. Accordingly, the issue has decided in favour of the assessee against the revenue. - I.T.A. No.7125/Mum/2013, I.T.A. No.6153/Mum/2014 & 35/M/2014, CO. No.41/Mum/2016 - - - Dated:- 31-7-2018 - SHRI R. C. SHARMA, AM AND SHRI AMARJIT SINGH, JM Revenue by : Shri Saurabh Kumar Rai ( DR ) Assessee by : Shri M. Subramanian ORDER Per Amarjit Singh, JM The Revenue as well as Assessee have filed the above mentioned appeals as well as cross objection against the different order passed by the Commissioner of Income Tax (Appeals)-18, Mumbai [hereinafter referred to as the CIT(A) ] relevant to the A.Y.2009-10 2010-11. ITA. NO.6153/M/2014:- 2. The revenue has filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that in the present case, we found that tax effect in the appeal so filed by the Revenue is below ₹ 20 lakhs. In order to cut down on frivolous litigation and taxpayer s grievance, the CBDT, which formulates policies for the Income Tax Department, has issued recent instruction No.3/2018 dated 11/07/2018 revising the monetary threshold fixing the tax effect limit of ₹ 20 lacs for the revenue to file appeal before the ITAT and since in this appeal, the tax effect is below ₹ 20 lakhs, the appeal filed by the revenue is not maintainable and liable to be dismissed in limine. 3. The CBDT in its Circular No.3/2018 dated 11th July 2018 have revised the monetary limit to ₹ 20 Lakhs to file the appeal before the Tribunal by the Revenue. On scrutiny of appeal filed by the revenue, it is found that the total tax demand is below the prescribed limit of ₹ 20 lakhs. The CBDT also clarifies that this instruction will apply retrospectively to pending appeals and appeals to be filed henceforth in High Courts/Tribunal. The Income Tax Act was amended and Section 268A has been introduced on the Statute book with retrospective effect. Section 268A carves out an exceptio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... case of penalty orders, the tax effect will mean quantum of penalty deleted or reduced in the order to be appealed against. 5. The Assessing Officer shall calculate the tax effect separately for every assessment year in respect of the disputed issues in the case of every assessee. If, in the case of an assessee, the disputed issues arise in more than one assessment year, appeal can be filed in respect of such assessment year or years in which the tax effect in respect of the disputed issues exceeds the monetary limit specified in para 3. No appeal shall be filed in respect of an assessment year or years in which the tax effect is less than the monetary limit specified in para 3. In other words, henceforth, appeals can be filed only with reference 10 the tax effect in the relevant assessment year. Howeve,r in case of a composite order of any High Court or appellate authority, which involves more than one assessment year and common issues in more than one assessment year, appeals shall be filed in respect of all such assessment years even if the tax effect is less than the prescribed monetary limits in any of the year(s), if it is decided to file appeal in respect of the year(s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal or the Court only on the ground that the Department has implicitly accepted the decision of the Tribunal or Court in the case of the assessee for any other assessment year or in the case of any other assessee for the same or any other assessment year, by not tiling an appeal on the same disputed issues. The Departmental representatives/counsels must make every effort to bring to the notice of the Tribunal or the Court that the appeal in such cases was not filed or not admitted only for the reason of the tax effect being less than the specified monetary limit and, therefore, no inference should be drawn that the decisions rendered therein were acceptable to the Department. Accordingly, they should impress upon the Tribunal or the Court that such cases do not have any precedent value and also bring to the notice of the Tribunal/ Court the provisions of sub section (4) of section 268A of the Income-tax Act, 1961 which read as under *( 4) The Appellate Tribunal or Court, hearing such appeal or reference, shall have regard to the orders, instructions or directions issued under sub-section (1) and the circumstances under which such appeal or application for reference was filed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cified tax limits in para 3 above may be withdrawn/ not pressed. 4. Considering the above CBDT circular, we found that this appeal of the revenue is not maintainable as the tax effect in this appeal is below ₹ 20 Lakhs. Accordingly, appeal of the revenue is dismissed. C.O. NO. 41/M/2016:- 8. The assessee has filed the cross-objection in the appeal of the revenue in ITA. No. 6153/M/2014. The assessee has raised the grounds of reopening u/s 147 of the Act. However, at the time of argument the assessee did not press the ground, therefore, the present ground is hereby ordered to be dismissed being not pressed. Accordingly, this cross-objection is decided in favour of the revenue against the assessee. ITA. NO. 35/M/2014:- 9. The revenue has filed the present appeal against the order dated 30.10.2013 passed by the Commissioner of Income Tax (Appeals)-18, Mumbai [hereinafter referred to as the CIT(A) ] relevant to the A.Y.2010- 11. 10. The revenue has raised the following grounds.: - i. ''Whether on the facts and in the circumstances of the case and in law, the Ld.C1T[A) erred in dealing the disallowance made u/s 24(b) towards interest of ₹ 31 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vices Ltd, was not availed of for the purpose of purchase of property at Nucleus, Pune. the interest of Rs,3VS4J64/- paid towards it had to the taken into account while computing expenses disallowable towards the exempt dividend income earned by the assesset-company?1' vii. The appellant prays that the order of the ClT(A) on the above grounds be set aside and that of the A.O. be restored/' viii, The appellant craves leave to amend or alter any grounds or add a new ground which may be necessary. 11. The brief facts of the case are that the assessee filed its return of income on 27.09.2010 declaring total income to the tune of ₹ 17,56,841/-. The return was processed u/s 143(1) of the I.T. Act, 1961. Thereafter, the case was selected for scrutiny and accordingly notice u/s 143(2) of the Act dated 23.09.2011 and notice u/s 142(1) of the Act dated 20.07.2012 were issued and served upon the assessee. During the period, the assessee has shown the rental income. In the year under consideration, the assessee has debited the interest expenses to the tune of ₹ 1,12,62,914/- to the profit loss account. The interest of ₹ 31,84,764/- claimed as deduct ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... credited of interest paid of ₹ 1,12,62,913/- out of which ₹ 60,445,288/- was suo-motu disallowed and added back to the taxable income. The amount of ₹ 20,32.86 W- was claimed u/s 24 paid to M/s Citi Bank Ltd. which was allowed by the A.O. and Rs,31 ,54,7647- claimed u/s 24 paid to M/s. Financial Services ltd. which was disallowed by the A.O. 7ns A.O. has called for information vi/'s 133(6) from M/s. India Bulls Financial Service^^Ltd. in which it was confirmed that this loan was arranged by the appellant for the property Office at 701 702, 7th Floor, Nucleus; Pune, but in the loan application form column for 'purpose of loan1 was left blank. This was the reason that the A.O. has created a doubt that this loan was Tot utilized for purchase of Pune property But the A.O has ignored that as per the loan agreement, it is dearly mentioned that this loans has been taken for purchase of Pune property only. Secondly, the AO. has concluded 'hat no evidence was submitted for the utilization of loan taken from MVs. India Bulls Financial Services Ltd. To explain this issue, the AR of the appellant has submitted its reply and extract of balance sheet for A.Y. 2006 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been allowed. On seeing the facts and circumstances of the case, we have arrived at this conclusion that the CIT(A) has passed the order judiciously and correctly which is not liable to be interfere with at this appellate stage. Accordingly, this issue is decided in favour of the assessee against the revenue. In the result, appeal filed by the revenue is hereby ordered to be dismissed. ITA. NO. 7125/M/2013:- 14. The assessee has filed the present appeal against the order dated 30.10.2013 passed by the Commissioner of Income Tax (Appeals)-18, Mumbai [hereinafter referred to as the CIT(A) ] relevant to the A.Y.2010-11. 15. The assessee has raised the following grounds. - 1. On the facts and in the circumstances of the case and in law, the Ld. CIT(A)-18, Mumbai has erred in sustaining disallowance of ₹ 3,28,374/- u/s 14A of the I.T. Act, 1961. The appellant therefore prays the penalty be deleted. Appellant craves to add, alter, amend, delete and/ or modify any or all of the aforesaid grounds of appeal either at the time of hearing or at any time before the date of hearing. 16. We have heard the argument advanced by the Ld. Representative of t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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