TMI Blog2002 (10) TMI 220X X X X Extracts X X X X X X X X Extracts X X X X ..... Counsel has relied upon the decision of ITAT, Chandigarh Bench in the case of ITO v. Dharinvir [2002] 253 ITR 1 and wherein the Tribunal has held that the Instructions are not issued by the CBDT in a light hearted manner. These instructions are issued after a great deal of deliberation and discussion where every aspect of the matter, more particularly the question of loss of revenue is examined in depth. Every Officer is enjoined with the duty to advance the policies laid down by the CBDT and see that these are not defeated. The Instructions are also aimed at reducing arrears in courts and Tribunals. The CBDT, in the Circular dated 27th March, 2000, had asked all Officers of the Income-tax Department under their control not to file appeals before the Appellate Tribunal in cases where the tax effect involved in appeal did not exceed Rs. 1.00 Lakh. These Instructions were binding on all Departmental Authorities and they could not be by-passed and treated as of no consequence on the pretext that these were private only and the authorities were bound to follow, comply with and see that the policies laid down by the Board achieve their objectives. Thus the Tribunal dismissed the appeals ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Madura Chit Investment (P.) Ltd. v. ITO [1994] 208 ITR 228, Reiter Machine Works Ltd. v. CIT [1995] 211 ITR 144 and Kerala Financial Corpn. v. CIT [1994] 210 ITR 129 (SC). Thus, the learned DR. has contended that the preliminary objection raised by the learned Counsel for the assessee about the maintainability of the appeal on the basis of the said Circular is not legally sustainable. In support thereof the learned D.R. has relied upon the decision of ITAT Delhi 'B' Bench in the case of ITO v. Sri Raj Kumar, Prop. Raj Cloth House [IT Appeal No. 4763 (Delhi) of 1996] (assessment year 1989-90), wherein the Tribunal has upheld the maintainability of appeal filed by the Revenue. 6. The learned D.R. in the alternative has also submitted that since the appeal has been filed in 1994, Instruction No. 1903 effective from 1-11-1992 would be relevant for consideration and not the instruction relied upon by the learned Counsel. The learned D.R. has further submitted that this is an Appeal filed against the cancellation of penalty imposed under section 271 (1)(c) of the Act. Hence, the monetary limit fixed for not filing the appeal would not be applicable in the instant case. 7. We have h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re merely administrative instruction for the internal use of Income-tax Authorities. In the case of CITV. Anjum M.H. Ghaswala 166 Taxation 586, the Hon'ble Supreme Court has held thus: "It is true that by this press release the Board had interpreted the provisions of the Act in a particular-manner. Be that as it may, we would like to make it clear that ever clarificatory note or press release issued by the Board does not have the statutory force like the Circulars issued by the Board under section 119 of the Act. It is only those Circulars issued by the Board under the provisions of section 119 of the Act will have the statutory force and will be binding on every Income-tax Authorities. Therefore, the press release relied upon by Shri Ramamurti not being a Circular issued under section 119 of the Act will not be of any assistance to the respondents in support of their contentions." 10. Further the Allahabad High Court in Janata Metal Works' case has held that Instructions are meant for guidance of Officers and do not create any legal rights or contain the Statutory power and cannot be enforced through Court. 11. Similar observations have been made by the Delhi High Court in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Collectors; its form (it began with words "that....The Government have decided") showed that the Government was conveying an executive decision to the Collectors to be followed by them. 14. In V.T. Khanzaode v. Reserve Bank of India AIR 1982 SC 917, the staff regulation issued by Reserve Bank of India (a statutory body) fixing the basis of seniority of its employees were held to be merely administrative instructions. The Court recognized that bank could issue such regulations under its general regulation making power under section 58 of the Reserve Bank of India Act. Such regulation could, however, be made with the previous sanction of the Central Government, and they were required to be laid before each House of Parliament. The Court held that the regulation in question were made not under section 58 but under administrative power of bank given to it by section 7(2) of the Act for the reason as under: Firstly, the regulations were not made with the previous sanction of the Government. Secondly, while issuing the regulation, the source of power under which they were made was not mentioned. The Court conceded that failure to do so by itself is not conclusive of the matt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... structions are statutory in nature, the same cannot stand the legal scrutiny as no subordination legislation can abrogate or override the provisions of the Act under which they have been framed. What section 119 has empowered the Board is to issue orders, instruction, or directions for the "proper administration" of the Act or for such other purposes specified in sub-section (2) of that section. Such an order, instruction or direction cannot override the provision of the Act. That would be destructive of the known principle of law as that would really amount to giving powers to a delegated authority even to amend the provision of law enacted by Parliament. Kerala Financial Corpn.'s case. It may be seen that under section 253 both the assessee and CIT have been allowed to prefer appeal before the Income-tax Appellate Tribunal if they are aggrieved by the order of First Appellate Authority. Thus the law has specifically authorized the Commissioner of Income-tax to direct the Assessing Officer to appeal to the Tribunal against such orders. This is statutory right conferred by the statute on the CIT. Any instruction or direction of CBDT curtailing the said statutory right would, in our ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... actorily and hence particulars have been concealed as per provisions of Explanation 1-B of the section 271(1)(c)." 21. Briefly stated facts are that two of the partners introduced a sum of Rs. 19,500 and Rs. 30,000 respectively as part of their share capital in the firm. It was explained before the Assessing Officer that the amount had been introduced out of their agriculture income. The assessee could not produce evidence in Form 6R regarding sale of agriculture produce. The CIT(A) admitted the capital introduced to the extent of Rs. 10,000 and confirmed addition of Rs. 15,000 in respect of one of the partners. The capital introduced by the other partner at Rs. 19,500 was confirmed as such. The Assessing Officer while levying the penalty has mentioned that it was explained before him that Shri Arvind Kumar Jain in respect of whom addition of Rs. 19,500 had been confirmed was a regular tax payer and has shown income from agriculture in his return of income at Rs. 20,500. As regards addition of Rs. 15,000 confirmed by CIT(A) in the case of other partner Shri Vimal Kumar Modi, it was mentioned that since the CIT(A) has admitted the capital to the extent of Rs. 18,000 only, penalty ..... X X X X Extracts X X X X X X X X Extracts X X X X
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