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2020 (3) TMI 1241 - AT - Income TaxMaintainability of appeal - low tax effect - reference to monetary limits prescribed by CBDT Circular No. 03 of 2018 dated 20-03-2018 - Tax effect of Revenue’s appeal not exceeding the monetary limit - Bogus purchases addition - additions made on the basis of corroboration information received from the Investigating Wing, Mumbai which is a law enforcement agency under the Ministry of Finance - HELD THAT:- As decided in S M/S. GEHLOT TRACTORS PVT. LTD., [2019 (11) TMI 1413 - ITAT JAIPUR] as per the original Circular No. 3 of 2018 these matters do not fall in the exception, however, the said circular was amended by the CBDT vide Notification dated 20.08.2018 and the amended para 10 of Circular No. 3 of 2018 Even as per Circular No. 23 of 2019 dated 6th September, 2019 the exception is provided only in the cases where organized tax evasion is noticed through bogus long term capital/short term capital gain on penny stocks. Therefore, the said Circular cannot be applied in the cases when the addition is not in respect of capital gain on penny stocks. Accordingly, the said circular will not help the cases of the department. In the case in hand, the addition was made by the AO based on the information received from DIT (Investigation) of the Department which is not an external source in the nature of law enforcement agencies such as CBI/ED/DRI/SFIO/Director General of GST Intelligence (DGGI) etc. Therefore, this case of the Revenue does not fall in the exception provided in clause (e) of para 10 of the Circular No. 3 of 2018. Accordingly, when the tax effect of Revenue’s appeal is not exceeding the monetary limit as prescribed in the Circular then the same is not maintainable. Hence, the appeal of the Revenue is dismissed.
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