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[Cites 11, Cited by 1]

Income Tax Appellate Tribunal - Cochin

Dcit, Trichur vs M/S St.Francis Clay Decor Tiles, ... on 26 June, 2019

                                   1

       IN THE INCOME TAX APPELLATE TRIBUNAL
              COCHIN BENCH, COCHIN
BEFORE S/SHRI CHANDRA POOJARI, AM & GEORGE GEORGE K., JM

                      I.T.A. Nos. 539 to 543/Coch/2013
                  Assessment Years : 2002-03 to 2006-07

The Deputy Commissioner of Vs.         M/s. New Kerala Investments,
Income-tax, Central Circle,            Annamanada,       Palayamparambu
Thrissur.                              P.O., Thrissur-680 741.
                                       [PAN:AAEFN 0017C]
.

    (Revenue-Appellant)                  (Assessee-Respondent)

                    I.T.A. Nos. 532 to 535/Coch/2013
                  Assessment Years : 2002-03 to 2005-06

The Deputy Commissioner of Vs.         E.T. Devassy & Sons,
Income-tax, Central Circle,            Edassery Jewellers,
Thrissur.                              R.S. Road, Chalakudy,
                                       Thrissur-680 697.
.                                      [PAN:AABFE 0977B

    (Revenue-Appellant)                  (Assessee-Respondent)


                    I.T.A. Nos.525 to 529/Coch/2013
                  Assessment Years : 2002-03 to 2006-07

The Deputy Commissioner of Vs.         St, Francis Clay Works,
Income-tax, Central Circle,            Palayamparambu P.O.,
Thrissur.                              Thrissur-680 307.
                                       [PAN: AAFLS 1105M]
.

    (Revenue-Appellant)                  (Assessee-Respondent)
                                                      I.T.A. Nos.539-543 /Coch/2013,
                                                                 532-535/Coch/2013
                                                               525 to 529/Coch/2013
                                                              594-597/Coch/2013 &
                                                                 587-589/Coch/2013
                        I.T.A. Nos. 594 to 597/Coch/2013
                      Assessment Years : 2002-03 to 2005-06

The Deputy Commissioner of Vs.               M/s. Edassery Ceramics,
Income-tax, Central Circle,                  Palayamparambu P.O.,
Thrissur.                                    Thrissur-680 741.
                                             [PAN: AAAFE 9254G]
.

     (Revenue-Appellant)                       (Assessee-Respondent)

                        I.T.A. Nos. 587 to 589/Coch/2013
                    Assessment Years : 2004-05 to 2006-07

The Deputy Commissioner of Vs.               M/s. St. Francis Clay Décor Tiles,
Income-tax, Central Circle,                  Thekkumuri, Cheruvaloor P.O.,
Thrissur.                                    Thrissur-680 321.
                                             [PAN: ABKFS 6632H]
.

     (Revenue-Appellant)                       (Assessee-Respondent)



              Revenue by         Shri Shantam Bose, CIT(DR) DR
              Assessee by        Shri Jose Kappen, CA

                 Date of hearing                 26/06/2019
                 Date of pronouncement           26/06/2019

                            ORDER


Per CHANDRA POOJARI, AM:

Brief facts of the case are that a search u/s, 132 of the Income Tax Act was conducted on 26.03.2008 in the premises of the firms and in the residence of the partners of E T Devassy Group.

2

I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013 2.1 Consequent to the search the Assessing Officer issued notice under Section 153A of the Income Tax Act for the Asst. Years 2002-03 to 2007-08 and issued notice under section 142(1) for the Assessment year 2008-09.

2.2 The Assessees filed return of income and the assessing officer completed the assessment under section 153A vide order dated 29.12.2009 in respect of the Asst.

Years 2002-03 to 2007-08 and u/s. 143(3) in respect of Asst. Year 2008-09 in respect of the following 84 cases in inspect of 13 Assesees.

1. M/s New Kerala Investments ( Asst Years 2002-03 to 2008-09)

2. M/s E T Devassy & Sons, Edassery (Asst Years 2002-03 to 2008-09)

3. St. Francis Tile Industries ( Asst Years 2007-08 to 2008-09)

4. St. Francis Clay Decor Tiles (Asst Years 2004-05 to2008-09)

5. St. Francis Clay Works (Asst Years 2002-03 to 2008-09)

6. Edassery Ceramics (Asst Years 2002-03 to 2008-09)

7. E.T. Devassy (Asst Years 2002-03 to 2008-09)

8. E.D.Jaison (Asst Years 2002-03 to 2008-09)

9. E.D. Sabu Asst Years 2002-03 to 2008-09)

10.E.D Benny (Asst Years 2002-03 to 2008-09) 1I. K.D Lilly (Asst Years 2002-03 to 2008-09

12.E.D. Shaju (Asst Years 2002-03 to 2008-09)

13.E. D. Salu (Asst Years 2002-03 to 2008-09) 2.3 Against the above orders, appeals were filed by the Assessees before the CIT(A), Kochi. The Commissioner of Income tax (Appeals) allowed the appeal, by accepting fresh/ new evidences. Against the order of the CIT(A), Department filed 84 appeals before the Tribunal. The respondents also filed cross objections before the Tribunal. The Tribunal vide common order dated 10.10.2014 dismissed the entire appeals.

3

I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013 2.4 Against the above order, the Department again filed appeals, before the Hon'ble Kerala High Court. The Hon'ble High Court vide judgment in ITA 169/2015 dated 17/08/2015 decided the case in favour of the Assessees and against the department.

2.5 Subsequently the department filed a review petition before the High Court in respect of 21 cases out of 84 cases, mentioned below, on the only ground that questions of law regarding "the appreciation of documents under Sec.153A of the I.T. Act" were not considered in the above order.

Details of cases for which department filed Review Petitions are :

Sl     Name of assessees               Asst. Years             ITA Nos.
No.
1.     M/s. New Kerala Investments     2002-03 to 2006-07      169, 223,194,


2.     M/s. E.T. Devassy and Sons,     2003 to 2005-06         141,171,216,
       Edassery Jewellers                                      110,103,150

3.     M/s. St. Francis Clay Works 2002-03 to 2006-07          134,222,211
4.     M/s. Edassery Ceramics      2002-03 to 2005-06          240,210,148
5.     M/s. St. Francis Clay Décor 2004-05 to 2006-07          234,193,104,
       Tiles                                                   239 and 157/2015



2.6 The high Court admitted the review petition in R.P. No. 1123/2015 and remanded back the above 21 cases out of 84 cases to the Tribunal for fresh consideration, vide order dated 22.03.2016, with the following observation:

4
I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013 "Therefore we set aside the order passed by the tribunal in the above appeals and remand the cases to the Tribunal to re-consider the question raised in these appeals by taking into account the principles laid down in the judgment cited by the Revenue as well as the assessee or any other principles of law laid down by competent courts of law and take a decision on merits in accordance with law. The question framed is answered in favour of revenue to the extent indicated above. However we make it clear that the common question with regard to the power of the Appellate Authority with respect to receipt of evidence in appeal and its application concluded by the tribunal in 84 cases and upheld by this court, will remain undisturbed"
2.7 Now the above referred 21 appeals were once again heard before the Tribunal.
3. At the time of hearing, the Ld. AR submitted that the tax effect in all these appeals is less than Rs.20 lakhs as follows:
Details of Disputed Income and Disputed Tax The Deputy Commissioner of Income Tax Vs Mis New Kerala Investments Central Circle Annamanada,Palayamparambu P.O Thrissur Thrissur 680 741 741741680741 539 to 543/Coch/2013 (Appellant) (Respondent) A B C D E F G Rs. Rs. Rs. Rs. Rs. Rs.
                      Income                                             Tax on x      Tax on
                      Returned(As                                        Assessed      returned
                        per            Income                           Income(As     income(A      Tax on
                       Assessment Assessed(As per         Disputed          per
                                                                        Assessment        s per disputed
                                                                                      Scheduled
  Asst Year           Order)      Assessment Order)       Income          Order)        Income      income
                                                                                          Tax)
      A                  B                C                (C-B)            E           F          (E-F)
   2002-03                    17,380      29,99,025        29,81,645      10,70,652      6,205     10,64,447
   2003-04                    65,130      38,13,954        37,48,824      14,01,628      23,366    13,78,262
                                                      5
                                                                     I.T.A. Nos.539-543 /Coch/2013,
                                                                                532-535/Coch/2013
                                                                              525 to 529/Coch/2013
                                                                              594-597/Coch/2013 &
                                                                                587-589/Coch/2013
2004-05            1,03,010             47,53,658         46,50,648     17,05,275     36,955    16,68,320
2005-06            1,41,155             47,18,031         45,76,876     17,26,444     51,651    16,74,793
2006-07            8,10,710             66,91,429         58,80,719     22,52,332 2,72,885      19,79,447




The Deputy Commissioner of Income Tax               Vs      M/s. E T Devassy & Sons
Central Circle                                              Edassery Jewellers
Thrissur                                                    R S Road, Chalakudy
                                                             Thrissur 680 697
                                                              532 to 535/Coch/2013
(Appellant)                                                  (Respondent)
     A             B               C                D                 E            F              G
                  Rs.             Rs.               Rs.              Rs.           Rs.                Rs.
                Income                                             Tax on

              Returned(As                                          Assessed       Tax on returned
                  per          Income                           Income(As per     income(As per Tax on
              Assessment    Assessed(As per    Disputed           Assessment        Scheduled disputed
  Asst Year     Order)        Assessment        Income              Order)         Income Tax) income
     A             B             Order)
                                    C             (C-B)                E                  F      (E-F)
  2002-03          15,342   21,99,125          21,83,783                 7,85,088 5,504          7,79,584
  2003-04          20,289   26,52,145          26,31,856                 9,74,663 7,279          9,67,384
  2004-05          33,044   31,98,485          31,65,441               11,47,456 11,854          11,35,602
  2005-06          39,370   38,57,373          38,18,003               14.11,509 14,408          13,97,101




                                                     6
                                                                   I.T.A. Nos.539-543 /Coch/2013,
                                                                              532-535/Coch/2013
                                                                            525 to 529/Coch/2013
                                                                           594-597/Coch/2013 &
                                                                              587-589/Coch/2013

The Deputy Commissioner of Income Tax                    Vs         M/s. St.Francis Clay Works,
Central Circle                                                      Palayamparambu P.O
Thrissur                                                             Thrissur 680 307
                                                                         307 to 529/2013
                                                                    Nos.525
(Appellant)                                                         (Respondent)
      A             B                    C               D               E              F                G
                    Rs.                 Rs.              Rs.            Rs.            Rs.               Rs.
                   Income                                               Tax on
                  Returned(As                                         Assessed        Tax on
                    per            Income                            Income(As       returned
                                                                                    income(A     Tax on
                   Assessment Assessed(As per          Disputed          per
                                                                     Assessment        s per disputed
                                                                                    Scheduled
  Asst Year       Order)      Assessment Order)        Income          Order)         Income     income
                                                                                       Tax)
      A              B                  C               (C-B)             E           F         (E-F)
   2002-03                13,335        1,81,113         1,67,778         64,658       4,784 59,874
   2003-04              14,292          1,94,111         1,79,819          71,336      5,127 66,209
   2004-05              24,276          3,29,712         3,05,436        1,18,284      8,709 1,09,575
   2005-06              88,625          12,03,687       11,15,062        4,31,822     32,430 3,00,392
   2006-07            1,64,636          22,36,053       20,71,417        7,52,654     55,418 6,97,236


The Deputy Commissioner of Income Tax                    Vs         M/s. Edassery Ceramics
Central Circle                                                      Palayamparambu P.O
Thrissur                                                             Thrissur 680 741
                                                                    594 to741597/Coch/2013
(Appellant)                                                         (Respondent)
      A             B                    C               D               E              F                G
                    Rs.                 Rs.              Rs.            Rs.            Rs.               Rs.
                   Income                                               Tax on
                  Returned(As                                         Assessed        Tax on
                    per            Income                            Income(As       returned
                                                                                    income(A     Tax on
                   Assessment Assessed(As per          Disputed          per
                                                                     Assessment        s per disputed
                                                                                    Scheduled
  Asst Year       Order)      Assessment Order)        Income          Order)         Income     income
                                                                                       Tax)
      A              B                  C               (C-B)             E           F         (E-F)
   2002-03                 8,245        1,92,320         1,84,075         68,658       2,976 65,682
   2003-04                26,639        6,21,373         5,94,734        2,28,354       9,556 2,18,798
                                                   7
                                                                    I.T.A. Nos.539-543 /Coch/2013,
                                                                                532-535/Coch/2013
                                                                             525 to 529/Coch/2013
                                                                             594-597/Coch/2013 &
                                                                                587-589/Coch/2013
   2004-05                 14,945        3,48,603           3,33,658       1,25,061      5,361 1,19,700
   2005-06                 58,842        13,72,530         13,13,688       5,02,244    21,531 4,80,713


The Deputy Commissioner of Income Tax                       Vs         M/s. St. Francis Clay Décor Tiles
Central Circle                                                         Thekkemuri, Cheruvalloor P.O.
Thrissur                                                                Thrissur 680       321
                                                                       587 to321
                                                                               589/Coch/2013
(Appellant)                                                            (Respondent)
      A              B                   C                  D               E             F                 G
                     Rs.                Rs.                 Rs.            Rs.           Rs.                Rs.
                    Income                                                Tax on
                   Returned(As                                          Assessed      Tax on
                     per            Income                             Income(As     returned
                                                                                    income(A        Tax on
                    Assessment Assessed(As per        Disputed             per
                                                                       Assessment      s per
                                                                                    Scheduled    disputed
  Asst Year        Order)      Assessment Order)      Income              Order)      Income        income
                                                                                       Tax)
      A               B                  C                 (C-B)             E        F            (E-F)
   2004-05                 19,631        7,03,143           6,83,512       2,52,253      7,043   2,45,210
   2005-06                 27,715        9,92,696           9,64,981       3,63,253      9,410   3,53,843
   2006-07                 48,261        17,28,612         16,80,351       5,81,850    16,245    5,65,605
                                         q


3. Accordingly, the Ld. AR placed reliance on the CBDT Circular No.3/2018 dated 11/07/2018. He submitted that these appeals are governed by the above CBDT Circular and the Department cannot file appeals before this Tribunal as the tax effect in these appeals is less than Rs.20 lakhs.

3.1 The Ld. DR submitted that he wants to take instructions from the concerned CIT to withdraw the appeals.

8

I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013

4. We have heard the rival submissions and perused the record. In our opinion, there is merit in the argument of the Ld. AR. We deem it appropriate to first refer to section 268A of the Income Tax Act, 1961 which was inserted by the Finance Act, 2008 with retrospective effect from 01/04/1999 which reads as under:

"268A (1) The Board may, from time to time issue orders, instructions or directions to other income tax authorities fixing such monetary limits as it may deem fit for the purpose of regulating filing of appeal or application for reference by any income tax authorities under the provisions of this Chapter.
(2) Where, in pursuance of the orders, instructions or directions issued under sub-section (1), an income tax authority has not filed any appeal or application for reference on any issue in the case of an assessee for any assessment year it shall not preclude such authority from filing an appeal or application for reference on the same issue in the case of -
(a) the same assessee for any other assessment year, or
(b) any other assessee for the same or any other assessment year.
(3) Notwithstanding that no appeal or application for reference has been filed by an income-tax authority pursuant to the orders or instructions or directions issued under sub-section(1), it shall not be lawful for the assessee, being a party in any appeal or reference, to contend that the income-tax authority has acquiesced in the decision on the disputed issue by not filing an appeal or application for reference in any case.
(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 or no filed in respect of any case.

(5) Every order, instruction or direction which has been issued by the Board fixing monetary limits for filing an appeal or application for reference shall be deemed to have been issued under sub-section (1) and the provisions of sub- section (2), (3) and (4) shall apply accordingly."

9

I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013 4.1 Relevant extracts (paras 1 to 13) from the aforesaid CBDT Circular No. 3/2018 dated 11/07/2018 is also reproduced hereunder for ready reference:

"Subject: Revision of monetary limits for filing of appeals by the Department before Income Tax Appellate Tribunal, High Courts and LPs/appeals before Supreme Court-measures for reducing litigation-Reg.
Reference is invited to Board's Circular No. 21 of 2015 dated 10.12.2015 wherein monetary limits and other conditions for filing departmental appeals (in Income-tax matters) before Income Tax Appellate Tribunal, High Courts and SLPs/ appeals before Supreme Court were specified.
2. In supersession of the above Circular, it has been decided by the Board that departmental appeals may be filed on merits before Income Tax Appellate Tribunal and High Courts and SLPs/ appeals before Supreme Court keeping in view the monetary limits and conditions specified below.
3. Henceforth, appeals/ SLPs shall not be filed in cases where the tax effect does not exceed the monetary limits given hereunder:
S. No. Appeals/SLPs in Income-tax matters Monetary Limit (Rs)
1. Before Appellate Tribunal 20,00,000/-
2. Before High Court 50,00,000/-
3. Before Supreme Court 1,00,00,000/-

It is clarified that an appeal should not he filed merely because the tax effect in a case exceeds the monetary limits prescribed above. Filing of appeal in such cases is to be decided on merits of the case.

4. For this purpose, 'tax effect' 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 issues against which appeal is intended to be filed (hereinafter referred to as 'disputed issues'). Further, 'tax effect' shall be tax including applicable surcharge and cess. However, the tax will not include any interest thereon, except where 10 I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013 chargeability of interest itself is in dispute. In case the chargeability of interest is the issue under dispute, the amount of interest shall be the tax effect. In cases where returned loss is reduced or assessed as income, the tax effect would include notional tax on disputed additions. In 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 to the tax effect in the relevant assessment year. However, 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 years(s), if it is decided to file appeal in respect of the year(s) in which tax effect exceeds the monetary limit prescribed. In cases where a composite order/judgment involves more than one assesses, each assesse shall be dealt with separately,

6. Further, where income is computed under the provisions of section 115JB or section 115JC, for the purposes of determination of 'tax effect', tax on the total income assessed shall be computed as per the following formula:-

(A -- B) + (C -- D) where, A = the total income assessed as per the provisions other than the provisions contained in section 115JB or section 115JC (herein called general provisions);
B = the total income that would have been chargeable had the total income assessed as per the general provisions been reduced by the amount of the disputed issues under general provisions;
C = the total income assessed as per the provisions contained in section 115JB or section 115JC;
11
I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013 D = the total income that would have been chargeable had the total income assessed as per the provisions contained in section 115JB or section 115JC was reduced by the amount of disputed issues under the said provisions:
However, where the amount of disputed issues is considered both under the provisions contained in section 115JB or section 115JC and under general provisions, such amount shall not he reduced from total income assessed while determining the amount under item D.

7. In a case where appeal before a Tribunal or a Court is not filed only on account of the tax effect being less than the monetary limit specified above, the Pr. Commissioner of Income-tax/ Commissioner of Income Tax shall specifically record that "even though the decision is not acceptable, appeal is not being filed only on the consideration that the tax effect is less than the monetary limit specified in this Circular". Further, in such cases, there will be no presumption that the Income-tax Department has acquiesced in the decision on the disputed issues. The income-tax Department shall not be precluded from filing an appeal against the disputed issues in the case of the same assessee for any other assessment year, or in the case of any other assessee for the same or any other assessment year, if the tax effect exceeds the specified monetary limits.

8. In the past, a number of instances have come to the notice of the Board, whereby an assessee has claimed relief from the Tribunal 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 filing an appeal on the same disputed issues. The Departmental representatives/counsels must make even 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 or not filed in respect of any case."
12

I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013

9. As the evidence of not filing appeal due to this Circular may have to be produced in courts, the judicial folders in the office of Pr.CsIT/ CslT must be maintained in a systemic manner for easy retrieval.

10. 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 is under challenge, or
(b) Where Board's order. Notification, Instruction or Circular has been held to be illegal or ultra vires, or
(c) Where Revenue Audit objection in the case has been accepted by the Department, or
(d) Where the addition relates to undisclosed foreign assets/ bank accounts.

11. The monetary limits specified in para 3 above shall not apply to writ matters and Direct tax matters other than income tax. Filing of appeals in other Direct tax matters shall continue to be governed by relevant provisions of statute and rules. Further, in cases where the tax effect is not quantifiable or not involved, such as the case of registration of trusts or institutions under section 12A/12AA of the IT Act, 1901 etc., filing of appeal shall not be governed by the limits specified in para 3 above and decision to file appeals in such cases may be taken on merits of a particular case.

12. It is clarified that the monetary limit of Rs. 20 lakhs for filing appeals before the ITAT would apply equally to cross objections under section 253(4) of the Act. Cross objections below this, monetary limit, already filed, should be pursued for dismissal as withdrawn/not pressed. Filing of cross objections below the monetary limit may not lie considered henceforth. Similarly, references to High Courts and SLPs/ appeals before Supreme Court below the monetary limit of Rs. 50 lakhs and Rs.1 Crore respectively should be pursued for dismissal as withdrawn/not pressed. References before High Court and appeals below these limits may not be considered henceforth.

13. This Circular will apply to SLPs/appeals/cross objections/references to be filed henceforth in SC/HCs/Tribunal and it shall also apply retrospectively to 13 I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013 pending SLPs/appeals/cross objections/references. Pending appeals below the specified tax limits in para 3 above may be withdrawn/ not pressed."

4.2 We have seen that the monetary limits have been made applicable retrospectively by the CBDT in the said Circular as would be evident from the following extract:

13. This Circular will apply to SLPs/appeals/cross objections/references to be filed henceforth in SC/HCs/Tribunal and it shall also apply retrospectively to pending SLPs/appeals/cross objections/references. Pending appeals below the specified tax limits in para 3 above may be withdrawn/ not pressed."
4.3 We have heard the submissions of the Ld. DR. The Ld. DR submitted that he wants to take instructions from the concerned CIT to withdraw the appeals. In our considered view, there is no necessity for adjourning the appeals as the tax effect involved in the present appeals of the Revenue is less than Rs.20 lakhs and accordingly, the request for adjournment is rejected.
4.4 Further, the Ld. DR was not able to show that the cases of the assessees are governed by any of the following exceptions:
1) where the constitutional validity of the Act or Income Tax Rules, 1962 is under challenge, or.
2) where the CBDT Order, Notification, Instruction or Circular has been held to be illegal or ultra vires, or
3) where the revenue audit objections in the case of the assessee has been accepted by the Department, or
4) where the addition relates to undisclosed foreign assets/bank accounts.
14

I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013 Being so, the assessees' cases are governed by the above CBDT circular. Hence, the Department is disentitled to file appeals before the Tribunal in respect of these assessees. However, by way of abundant caution, liberty is granted to the Revenue to file Miscellaneous Petition if the assessees' cases fall under any of the exceptions mentioned above or if the Department is able to show that the tax effect in these cases is more than Rs.20 lakhs as prescribed in above CBDT Circular. Thus, the appeals of the Revenue are dismissed.

5. In the result, the appeals of the Revenue are dismissed.

Order pronounced in the open Court on this 26 th June, 2019 sd/- sd/-

(GEORGE GEORGE K.)                            (CHANDRA POOJARI)
JUDICIAL MEMBER                              ACCOUNTANT MEMBER
Place: Kochi
Dated: 26th June, 2019
GJ
Copy to:

1. M/s. New Kerala Investments, Anammanada, Palayamparambu P.O., Thrissur-680 741.

2. E.T. Devassy & Sons, Edassery Jewellers, R.S. Road, Chalakudy, Thrissur-680 697.

3. M/s. Edassery Ceramics, Palayamparambu P.O., Thrissur-680 741.

4. M/s. St. Francis Clay Décor Tiles, Thekkumuri, Cheruvaloor P.O., Thrissur-680 321.

15

I.T.A. Nos.539-543 /Coch/2013, 532-535/Coch/2013 525 to 529/Coch/2013 594-597/Coch/2013 & 587-589/Coch/2013

5. The Deputy Commissioner of Income-tax, Central Circle, Thrissur.

6. The Commissioner of Income-tax(Appeals)-V, Kochi.

7. The Commissioner of Income-tax, Central, Kochi.

8. D.R., I.T.A.T., Cochin Bench, Cochin.

9. Guard File.

By Order (ASSISTANT REGISTRAR) I.T.A.T., Cochin 16