Case Law Details
ACIT Vs Madras Cricket Club (ITAT Chennai)
In ACIT vs. Madras Cricket Club, the Income Tax Appellate Tribunal (ITAT) in Chennai dismissed the Revenue’s appeal regarding the addition of Rs. 1.91 crore as entrance fees in the club’s income for the assessment year 2009-10. The appeal, initially delayed by 175 days, was condoned based on the Revenue’s request and explanations for the delay. However, the appeal was ultimately dismissed due to the tax effect involved being less than the threshold of Rs. 60 lakh, as per the Central Board of Direct Taxes (CBDT) Circular No. 09 of 2024. This circular, dated 17th September 2024, stipulates that appeals involving tax amounts below Rs. 60 lakh should not be pursued before the ITAT, except in specific exceptional cases.
The ITAT upheld the CBDT circular’s guidelines, finding the Revenue’s appeal unmaintainable as the tax effect was reported to be Rs. 57.4 lakh. The tribunal clarified that this dismissal does not preclude the Revenue from reopening the issue in future proceedings if warranted and stated that if any exception in the circular applies, the Revenue may seek to recall the order. Consequently, the ITAT dismissed the appeal, citing adherence to the CBDT’s guidelines on limiting litigation for cases involving lower tax impacts.
FULL TEXT OF THE ORDER OF ITAT CHENNAI
Aforesaid appeal filed by the Revenue for Assessment Year (AY) 2009-10 arises out of the order of Learned Commissioner of Income Tax, National Faceless Appeal Centre (NFAC), Delhi, [hereinafter “CIT(A)”] dated 22.02.2017.
2. There is a delay of 175 days in filing the appeal by the Revenue. The Revenue has filed condonation petition stating the reasons for delay in filing the appeal. We have considered the petition of delay in filing the appeal and satisfied that there was sufficient cause for not filing the appeal within the prescribed time limit. Hence, the delay is condoned accordingly.
3. The appeal filed by the Revenue is against the order of Ld. CIT(A) confirming the addition on entrance fee of Rs. 1,93,36,486/-. The A.O in the assessment order passed u/s. 143 r.w.s 147 of the Act has added the entrance fee of Rs. 1,91,36,486/-. The assessee has filed appeal before Ld. CIT(A), the Ld. CIT(A) has allowed the assessee’s appeal. Now, the Revenue is in further appeal before us.
4. The Ld. Authorized Representative (A.R) of the assessee at the outset submitted the tax effect as reported by Ld A.O in Form 36 is at Rs. 57,40,945/-, which is less than Rs. 60 lakhs as per the CBDT vide Circular No.09 of 2024 dated 17.09.2024 therefore, appeal need to be withdrawn.
5. The Ld. Departmental Representative (DR) could not controvert the fact that addition made by the AO is Rs 1,91,36,486 and the disputed tax reported in form 36 is less than 60 lakhs..
6. We have heard the rival submissions, and perused the materials available on record. The tax effect involved in revenue appeal is less than Rs 60 Lkah. The CBDT vide Circular No.09 of 2024 dated 17.09.2024 has increased the monetary limit for filing the appeal by the Revenue before the ITAT to Rs. 60 Lakhs. In the said circular, it is stated that in cases where the tax effect in the appeal to be filed before the Appellate Tribunal does not exceed Rs. 60 lakhs appeals should not be filed. Thus, taking note of CBDT Circular No. 09 of 2024 dated 17.09.2024 and considering the fact that the tax effect in the instant appeal is less than Rs. 60 lakhs, the present appeal deserves to be dismissed as withdrawn / not maintainable. However, we make it clear that the issues raised in the instant appeal is left open to be examined in the appropriate proceedings, if arises, in future. At the same time, we also make it clear that if the appeal fall in any of the exceptions referred to in the above said CBDT Circular, the Revenue is at liberty to move an application for recalling the order, if so advised. Accordingly, in the light of CBDT circular No. 09 of 2024 dated 17.09.2024, this appeal stands dismissed.
7. In the result, the appeal filed by the Revenue is dismissed. Order pronounced on 25th October, 2024.
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