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2021 (2) TMI 646 - HC - Income TaxMaintainability of appeal - ITAT dismissed the appeal on the ground of low tax effect being less than 10 lakhs - Board Circular No.21/2015 - Determination of tax effect where returned loss is reduced or assessed as income, the tax effect would include notional tax on disputed additions - whether tax effect would include notional tax on disputed additions? - THAT:- From perusal of para 4 of Circular No.21/2015, it is evident that where the returned loss is reduced or assessed as income, the tax effect would include notional tax on disputed additions and the Assessing Authority had made disallowances with regard to the provisions of wage reversion to the extent as well as provision for audit frees and the notional tax effect on aforesaid contested issue was more than ₹ 10 Lakhs and therefore, the appeal before the tribunal was maintainable and the same ought to have been adjudicated on merits. For the aforementioned reasons, the substantial question of law is answered in favour of the revenue. However, the aforesaid aspect of the matter has not been appreciated by the tribunal. The impugned order of the tribunal is quashed and the matter is remitted to the tribunal for decision afresh in accordance with law.
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