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TMI Blog2018 (8) TMI 2014X X X X Extracts X X X X X X X X Extracts X X X X ..... ting the disallowance made on account of excess depreciation of Rs. 21, 73, 214/- and it is below tax effect, which does not exceed the monetary limit as prescribed by CBDT Instruction 21/2015 dt. 10-12- 2015 and prayed to dismiss the appeal of revenue being low tax effect as it is not maintainable as per said CBDT Instruction. 3. The ld. DR has objected to the above submissions of the ld. AR and contended that the addition made by the AO was prompted by audit objection in respect of excess claim of depreciation. The dept. of Revenue has not accepted the decision of the CIT-A in deleting the impugned addition as the issue involved therein is a claim of higher rate of depreciation. He also submitted that the AO made this addition in pursuan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ases on merits and by interpreting para 8 (c) of Circular No. 21/2015 erroneously. The same was clarified by CBDT by way of Circular No. 05/2017 dt. 23-01-2017 and referred to para 3 of said circular. In support of the contention, the ld. AR placed reliance on the order of Co-ordinate Bench, ITAT, Visakhapatnam in the case of Movva Lakshmi and referred to para 3. 2 of the said order and argued that the Co-ordinate Bench in the case of Movva Lakshmi supra considered the CBDT Circular No. 21/2015 dt. 10-12-2015 and subsequent Circulars 5/2017 dt. 23-01- 2017 and held that the revenue shall not file the appeal(s) as a matter of routine merely because there is revenue audit objection. 6. By referring to present case, ld. AR submits that the CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... structions. We find that the issue in hand is to be decided by us as to whether the appeal effect is below the monetary limit or not and whether it is covered by para 8 ( c ) of the CBDT Circular No. 21/2015 dt. 10-12-2015. For better understanding para 8 of Circular No. 21/2015 is reproduced herein below:- "8. Adverse judgments relating to the following issues should be contested on merits notwithstanding that the tax effect entailed is less than the monetary limits specified in para 3 above or there is no tax effect : (a) Where the Constitutional validity of the provisions of an Act or Rule are under challenge, or (b) Where Board's order, Notification, Instruction or Circular has been held to be illegal or ultra vires, or (c) W ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ls against the adverse judgment should only be filed on merits. " 11. The Circular 5/2017 was issued by the CBDT in order to measures for reducing litigation, wherein it clarified the direction in para 8 of Circular 21/2015 specifically to contest on merits negates the mechanical filing of appeals in these cases. It is clear from para 3 of Circular no. 5/2017 that the appeal(s) can be filed by the revenue only on merits, even on issues contemplated (a) to (d) mentioned in para-8 of Circular 21/2015. Therefore, it is clear, an appeal should not be filed merely on the presumption that the additions involving the exceptions in para-8 of Circular 21/2015, but, only on merits. 12. Further, to examine Instruction No. 7/2017 dt. 21-7-2017, as r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dition made on account of excess depreciation by placing reliance on the decision of Hon'ble High Court of Bombay in the case of S. C. Thakur & Bros. supra . Therefore, in our opinion the present appeal should be only on merits, if the appellant revenue is not justified either in law or in facts. Thus, the arguments as advanced by the ld. DR fails and are rejected with reference to the submission that the issue arose on audit objection. 14. Further, the order of the Co-ordinate Bench in the case of Movva Lakshmi supra vide order dt. 06-12-2017 dismissed the appeal of revenue as unadmitted. On perusal of said order, the AO has been directed to file an appeal against the order of CIT-A on similar set of facts, which are identical to present ..... X X X X Extracts X X X X X X X X Extracts X X X X
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