ITAT Mumbai recalls order dismissing Revenue's appeal due to low tax effect, based on assessment reopening from external agency info.

The Appellate Tribunal ITAT Mumbai recalled its order dismissing the Revenue's appeal due to low tax effect in ITA No.3238/Mum/2019 for assessment years 2010-11. The Department successfully argued for the recall based on the assessment being reopened from information obtained from an external agency, falling under an exception mentioned in a CBDT communication. The Tribunal, upon considering the submissions, decided to restore the appeal, instructing the Registry to schedule a hearing after serving notice to both parties.

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Issues:
Recalling of Tribunal order due to low tax effect in the appeal by Revenue.

Analysis:
The Appellate Tribunal ITAT Mumbai, in a judgment delivered by Shri Vikas Awasthy, Judicial Member, addressed a Miscellaneous Application under section 254(2) of the Income Tax Act, 1961. The Department filed the application seeking the recall of the Tribunal's order in ITA No.3238/Mum/2019 for assessment years 2010-11 dated 16/09/2020. The Department, represented by Shri T. Shankar, argued that the Tribunal had dismissed the Revenue's appeal due to low tax effect following CBDT Circular No.17/2019 dated 08/08/2019. It was highlighted that the assessment in question was reopened based on information from the Sales Tax Department, Government of Maharashtra, falling under an exception mentioned in para 10(e) of the CBDT communication dated 20/08/2018.

Upon hearing the submissions made by the Departmental Representative, the Tribunal noted that the assessment was indeed reopened based on information received from the Sales Tax Department, Government of Maharashtra, even though the information was routed through DGIT (Inv). This indicated that the reopening was triggered by information sourced from an external agency. Consequently, the Tribunal decided to recall its order dated 16/09/2020, which dismissed the appeal of the Revenue due to low tax effect. The appeal was then restored to its original number, allowing the Miscellaneous Application by the Revenue.

As a result of the judgment, the Registry was instructed to schedule the appeal for a hearing in due course after serving notice to both parties. The order was pronounced in open Court on Friday, the 24th day of February, 2023.

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