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08-07-2019, Shri Amarchand P Shah, Section 115JC, 115JB, Tribunal Mumbai

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1 week 2 days ago #10005 by amit
Section - 115JC, 115JB, 268A, 12A, 253(4)
Order Date - 08-07-2019
Favouring - Assessee
Court - Tribunal Mumbai
Appellant - ITO
Respondent - Shri Amarchand P Shah
Justice - C. N. PRASAD JM & RAMIT KOCHAR AM
Citation - 719Taxpundit99
Appeal No. - I.T.A. No.818-820/Mum/2017
Asstt. Year - 2010-11,2007-08 & 2008-09

Order

PER : C. N. PRASAD

These three appeal(s) filed by the Revenue in ITA No. 818- 820/Mum/2017 are disposed off because the tax effect in these three appeals is less than Rs. 20 lacs ( in each of the appeals separately, tax effect is not exceeding Rs. 20 lacs ) as per CBDT Circular No. 3/2018, F. No. 279/Misc.142/2007-ITJ (Pt) dated 11th July, 2018 issued by Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, Government of India, which stood later modified vide F.No.279/Misc 142/2007-ITJ-(Pt) dated 20.08.2018.

2. The learned counsel for the assessee at the outset pleaded that these appeals filed by Revenue are covered by CBDT circular dated 11.07.2018 and should be dismissed owing to low tax effect . The learned counsel for the assessee has placed on record computation of tax effect in these appeals which in these there appeals comes to less than Rs. 20 lacs each of the appeal. The Ld. DR rebutted the contentions of the assessee‟s counsel and submitted that these three appeals filed by Revenue relates to additions made in the hand of the assessee based on information received from Investigation Wing, Mumbai in pursuance of searches conducted by Revenue u/s 132 on Mr Bhanwarlal Jain group and it is claimed that DGIT(Inv.), Mumbai is an „external source‟ who is an „law enforcement agency‟ who has forwarded information to learned Assessing Officer( “AO”) based on which additions were made to the income of the assessee and hence these appeals are covered by exception in para 10(e) of CBDT circular No. 3/2018 dated 11.07.2018 which was later modified vide F.No.279/Misc 142/2007-ITJ-(Pt) dated 20.08.2018, wherein scope of exceptions w re widened by amending circular dated 11.07.2018 and hence these three appeals cannot be disposed of as low tax effect appeals . The learned DR requested that apart from oral arguments as advanced before the Bench, the Revenue may be granted liberty to file written submissions The Bench granted liberty to learned DR to file written submissions as well evidences in case these appeals are covered by exception carved out by circular dated 11.07.2018 and its modification dated 20 08 2018. The learned DR has filed written submissions dated 04.07.2019 , which are reproduced hereunder:

2.2 The learned DR has also enclosed aforesaid circular dated 11.07.2018 and its modification dated 20 08.2018, along with its aforesaid letter dated 04.07.2019 which is reproduced herein below The learned DR however did not file any evidence of receipt of an information by Revenue from „external sources‟ in the nature of „law enforcement agencies‟ such as CBI/ED/DRI/SFIO/ Directorate General of GST Intelligence (DGGI) except that contending that Directorate of Income-tax(Investigation), Mumbai is an „external sources‟ in the nature of law enforcement‟ agency being external to „assessment unit‟ of the Income Tax Department and hence exception 10(e) is applicable , so the appeal may not be dismissed as low tax effect appeal covered by CBDT circular dated 11.07.2018.The learned DR although agreed that tax effect in these three appeals are less than Rs. 20 lacs but owing to the fact that information was received by AO from Directorate of IncomeTax(Investigation) , claim has been set up by Revenue that these appeals should not be dismissed owing to low tax effect because these appeals are covered by exceptions given under aforesaid circular dated 11.07.2018 as modified on 20.07.2018, vide para 10(e) because as per learned DR , information received from Directorate of Income-tax(Inv.), Mumbai is all together an information received from „external sources‟ in the nature of „law enforcement agencies‟ so far as assessment unit of Income-tax Department is concerned. . It is important at this stage to reproduce para 10(e) of aforesaid circular dated 11.07.2018 as modified on 20.08.2018., as under:

“10 *** ***

(e) Where addition is based on information received from external sources in the nature of law enforcement agencies such as CBI/ED/DRI/SFIO/Directorate General of GST Intelligence”

2.3 It is also pertinent to reproduce hereunder , the CBDT circular dated 11.07.2018 and also its modification dated 20.08.2018 for disposing of low tax effect filed by Revenue, which are reproduced hereunder:-

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