Appeal Dismissed for Late Plea Introduction: No Merit Found in

The High Court upheld the dismissal of the appeal by ITAT, ruling that the Appellant-Department could not introduce the plea of applicability of Clause 10 (c) of Circular No. 3/2018 during the appeal as it was not raised in the prior proceedings. The Court found no substantial question of law and concluded that there was no merit in the appeal, dismissing any pending applications accordingly.

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Issues Involved:
Challenge to assessment order disallowing deduction under Section 80IC of Income Tax Act - Applicability of Circular No. 17/2019 issued by CBDT - Failure to consider merits of the case by ITAT.

Analysis:
1. The respondent-assessee-firm declared income and claimed deduction under Section 80IC of the Income Tax Act for the Assessment Year 2012-13. The assessment was completed under Section 143 (3) of the Act, disallowing a portion of the deduction. The assessee appealed to CIT(A) Shimla, which allowed the appeal.

2. The Appellant-Department challenged the CIT(A) order before ITAT, Chandigarh. The ITAT dismissed the appeal, prompting the Appellant-Department to contest the decision based on Circular No. 17/2019 issued by CBDT, which enhanced monetary limits for filing appeals. The Appellant-Department argued that ITAT failed to consider the merits of the case and that the circular was not applicable due to Clause 10 (c) of CBDT Circular No. 3/2018.

3. The main issue revolved around the applicability of Clause 10 (c) of Circular No. 3/2018 in light of Circular No. 17/2019. The ITAT considered the revised monetary limits for filing appeals set by Circular No. 17/2019, which increased the limits for different levels of appeal. The Appellant-Department did not raise the applicability of Clause 10 (c) of Circular No. 3/2018 during the ITAT hearing, precluding them from raising it in the current appeal.

4. The ITAT correctly found the appeal not maintainable under the provisions of Circular No. 17/2019. Consequently, the High Court dismissed the appeal, stating that no substantial question of law arose for determination. The judgment emphasized that since the Appellant-Department did not raise the plea of applicability of Clause 10 (c) during the ITAT proceedings, they could not introduce it in the current appeal.

5. The High Court found no other deficiencies in the ITAT's order and upheld the dismissal of the appeal. The judgment concluded that based on the discussion, there was no merit in the appeal, and any pending applications were also dismissed accordingly.

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