ITO v. M.P. Police Sakh Sahakari Sanstha Maryadit
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Case in 2 minutes
The reported Tribunal order dismisses departmental appeals under the revised low-tax-effect circular framework and notes the changed treatment of the earlier audit-objection exception. Primary verification is required for the exact circular operation date and exception language.
Case snapshot
Sections / provisions: 268A
Questions before the Court / Tribunal
- Low tax effect after CBDT Circular 5/2024 and audit-objection exception: The reported Tribunal order dismisses departmental appeals under the revised low-tax-effect circular framework and notes the changed treatment of the earlier audit-objection exception. Primary verification is required for the exact circular operation date and exception language.
Material facts and background
due to low tax effect of Rs.3,23,712/- and Rs.3,13,567/- respectively in view of CBDT circular No.3/2018, Circular No.17/20198 and latest Circular No.5/2024 dated 15.3.2024 and submitted that the appeals filed by the revenue are not maintainable. On the other hand Ld. DR has filed comments of A.O that due to tax audit objection in the case of the assessee which was accepted by the A.O while reopening the assessment, despite tax effect in both the years which are below the prescribed monetary limit these two cases fall under the exception in para No.10(c) of the Circular No.3/2018 and 17/2019. Thus, the Ld. DR has submitted that these cases fall in the exception and
ITA Nos.173&174/Ind/2024 M.P. Police Sakh Sahakari Sanstha Mardyadit should be decided on the merits instead of low tax effect. To counter the stand of the Department Ld. AR has submitted that the latest circular No.5/2024 has an effect of supersession of the earlier circulars issued by the CBDT and the exceptions as provided in the earlier circulars have been modified as per the new circular which does not have an exception with regard to the audit objections as it was there in the earlier circulars. Thus, the Ld. AR submitted that the appeals of the department are not maintainable and liable to be dismissed.
He has also relied upon Circular No.18/2015 dated 02.11.2015
whereby the CBDT has clarified that in view of the judgment of Hon’ble Supreme Court in case of CIT V/s Nawanshahar Central Cooperative Bank Ltd 160 Taxman 48 (SC) the income arising from the investments made by the cooperative banks as well as commercial banks is attributable to the business of banking falling under the head “Profits and Gains of Business and Profession” and therefore, is eligible for claiming deduction u/s 80P(2)(a)(i) of the Act. The Board has decided that no appeal may be filed on this ground by the officers of the Department and the appeals already filed, if any, on this ground before the Courts/Tribunal may be withdrawn/nor pressed upon. Thus, the Ld. AR has submitted that even otherwise when the CIT(A) has allowed the claim of deduction u/s 80P(2)(a)(i) in respect of interest income which is in conformity with the judgment of Hon’ble Supreme Court as well as CBDT circular No.18/2015 (supra) the department ought to have not filed these appeals and now shall withdraw or not press upon these appeals.
ITA Nos.173&174/Ind/2024 M.P. Police Sakh Sahakari Sanstha Mardyadit 4.
We have considered rival submissions as well as relevant material on
Appellant / assessee submissions
The Ld. AR has raised the question of maintainability of these appeals
ITA Nos.173&174/Ind/2024 M.P. Police Sakh Sahakari Sanstha Mardyadit should be decided on the merits instead of low tax effect. To counter the stand of the Department Ld. AR has submitted that the latest circular No.5/2024 has an effect of supersession of the earlier circulars issued by the CBDT and the exceptions as provided in the earlier circulars have been modified as per the new circular which does not have an exception with regard to the audit objections as it was there in the earlier circulars. Thus, the Ld. AR submitted that the appeals of the department are not maintainable and liable to be dismissed.
whereby the CBDT has clarified that in view of the judgment of Hon’ble Supreme Court in case of CIT V/s Nawanshahar Central Cooperative Bank Ltd 160 Taxman 48 (SC) the income arising from the investments made by the cooperative banks as well as commercial banks is attributable to the business of banking falling under the head “Profits and Gains of Business and Profession” and therefore, is eligible for claiming deduction u/s 80P(2)(a)(i) of the Act. The Board has decided that no appeal may be filed on this ground by the officers of the Department and the appeals already filed, if any, on this ground before the Courts/Tribunal may be withdrawn/nor pressed upon. Thus, the Ld. AR has submitted that even otherwise when the CIT(A) has allowed the claim of deduction u/s 80P(2)(a)(i) in respect of interest income which is in conformity with the judgment of Hon’ble Supreme Court as well as CBDT circular No.18/2015 (supra) the department ought to have not filed these appeals and now shall withdraw or not press upon these appeals.
Revenue / respondent submissions
due to low tax effect of Rs.3,23,712/- and Rs.3,13,567/- respectively in view of CBDT circular No.3/2018, Circular No.17/20198 and latest Circular No.5/2024 dated 15.3.2024 and submitted that the appeals filed by the revenue are not maintainable. On the other hand Ld. DR has filed comments of A.O that due to tax audit objection in the case of the assessee which was accepted by the A.O while reopening the assessment, despite tax effect in both the years which are below the prescribed monetary limit these two cases fall under the exception in para No.10(c) of the Circular No.3/2018 and 17/2019. Thus, the Ld. DR has submitted that these cases fall in the exception and
The respondent CIT CIT(A) Departmental Representative Guard File 6. By order UE COPY Sr. Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore
Court / Tribunal analysis and reasoning
whereby the CBDT has clarified that in view of the judgment of Hon’ble Supreme Court in case of CIT V/s Nawanshahar Central Cooperative Bank Ltd 160 Taxman 48 (SC) the income arising from the investments made by the cooperative banks as well as commercial banks is attributable to the business of banking falling under the head “Profits and Gains of Business and Profession” and therefore, is eligible for claiming deduction u/s 80P(2)(a)(i) of the Act. The Board has decided that no appeal may be filed on this ground by the officers of the Department and the appeals already filed, if any, on this ground before the Courts/Tribunal may be withdrawn/nor pressed upon. Thus, the Ld. AR has submitted that even otherwise when the CIT(A) has allowed the claim of deduction u/s 80P(2)(a)(i) in respect of interest income which is in conformity with the judgment of Hon’ble Supreme Court as well as CBDT circular No.18/2015 (supra) the department ought to have not filed these appeals and now shall withdraw or not press upon these appeals.
department are dismissed due to low tax effect therefore, we do not proposed to go into the merits of the issue of allowability of deduction u/s 80P(2)(a)(i) of the Act. 7.
Operative decision and relief
filed on 27.2.2024 and consequently due to low tax effect the appeals of the revenue are not maintainable and liable to be dismissed.
department are dismissed due to low tax effect therefore, we do not proposed to go into the merits of the issue of allowability of deduction u/s 80P(2)(a)(i) of the Act. 7.
In the result, the appeals of the revenue are dismissed. Order pronounced in the open court on 12.07.2024.
The respondent CIT CIT(A) Departmental Representative Guard File 6. By order UE COPY Sr. Private Secretary Income Tax Appellate Tribunal Indore Bench, Indore
Authorities and precedents appearing in the judgment
- No reliable precedent list was extracted automatically; use the full judgment for the citation chain.
This list is machine-assisted from the judgment text and is not a substitute for checking the full citation chain in the PDF.
Ratio and legal principle
The decision turns on Low tax effect after CBDT Circular 5/2024 and audit-objection exception. The operative result is classified as Operative order controls. Read the rule only with the statutory version, factual findings and precedent chain recorded in the full judgment.
Why this judgment matters
The case is relevant to taxpayers, advisers and litigators dealing with Low tax effect after CBDT Circular 5/2024 and audit-objection exception. Its practical value lies in the interaction between the statutory text, the evidentiary record and the procedural route followed in this case.
Practitioner action points
- Build a transaction-level evidence file: confirmations, bank trail, invoices, ledger, tax/GST records and counter-party material rather than relying on a generic explanation.
- Where the addition depends on a third-party statement or investigation report, record the request for the relied material and cross-examination at the earliest stage.
- For litigation, attach the full judgment/order to the working paper and cite the paragraph/page supporting the proposition rather than relying on a headnote alone.
Do not over-read this case
- The packaged PDF is not yet an issuing-authority certified copy
- Apply the statutory law applicable to the relevant year; later amendments can change the result.
- Check whether a later High Court or Supreme Court judgment has affirmed, distinguished, reversed or superseded this decision.
Finin2min Judgment Intelligence
Decision support built around the judgment: reliance, fact match, Q&A, section impact, related-case network and practical next steps.
Can I rely on this judgment?
| Authority level | ITAT |
|---|---|
| Reliance effect | Tribunal precedent. Persuasive for similar facts; subject to the jurisdictional High Court and Supreme Court. Coordinate-Bench discipline should be checked. |
| Source integrity | A sanitized local full-text judgment copy is packaged; official-primary replacement remains pending. |
| Subsequent history | Subsequent appellate history is not fully closed in the current ledger. Recheck before filing or opinion work. |
| Finin2min status | Later-history check open |
Does this case match your facts?
Stronger match when
- Your dispute raises the same core issue: Low tax effect after CBDT Circular 5/2024 and audit-objection exception.
- The same statutory provisions or materially equivalent provisions apply: 268A.
- Your matter is at a comparable appeal/revision stage.
- Your documentary/evidentiary record is materially similar to the facts the ITAT Indore considered: due to low tax effect of Rs.3,23,712/- and Rs.3,13,567/- respectively in view of CBDT circular No.3/2018, Circular No.17/20198 and latest Circular No.5/2024 dated 15.3.2024 and submitted that the appeals filed by the revenue are not maintainable.
- The same legal regime or assessment-period rules relevant to AY 2014-15 apply to your matter.
Weaker / distinguishable when
- A later Supreme Court or jurisdictional High Court ruling changes the legal position.
- The statutory provision was amended for your year or transaction.
- Your evidence, transaction structure, notice chronology or procedural stage differs on a fact the judgment treated as material.
- The case succeeded on a narrow jurisdictional/procedural defect that the authority has cured in your matter.
Questions this judgment answers
What was the main dispute in ITO?
The reported Tribunal order dismisses departmental appeals under the revised low-tax-effect circular framework and notes the changed treatment of the earlier audit-objection exception. Primary verification is required for the exact circular operation date and exception language.
Which facts mattered most to the result?
due to low tax effect of Rs.3,23,712/- and Rs.3,13,567/- respectively in view of CBDT circular No.3/2018, Circular No.17/20198 and latest Circular No.5/2024 dated 15.3.2024 and submitted that the appeals filed by the revenue are not maintainable. On the other hand Ld. DR has filed comments of A.O that due to tax audit objection in the case of the assessee which was accepted by the A.O while reopening the assessment, despite tax effect in both the years which are below the prescribed monetary limit these two cases fall under the exception in para No.10(c) of the Circular No.3/2018 and 17/2019.
What did the ITAT Indore ultimately decide?
filed on 27.2.2024 and consequently due to low tax effect the appeals of the revenue are not maintainable and liable to be dismissed. department are dismissed due to low tax effect therefore, we do not proposed to go into the merits of the issue of allowability of deduction u/s 80P(2)(a)(i) of the Act. 7. In the result, the appeals of the revenue are dismissed.
What legal principle can be taken from this judgment?
The decision turns on Low tax effect after CBDT Circular 5/2024 and audit-objection exception. The operative result is classified as Operative order controls. Read the rule only with the statutory version, factual findings and precedent chain recorded in the full judgment.
Which provisions should be checked before relying on the case?
The case engages 268A. The relevant statutory version for AY 2014-15 should be checked together with any later amendment, notification, circular and controlling higher-court authority.
When is this judgment most useful to a taxpayer or adviser?
The case is relevant to taxpayers, advisers and litigators dealing with Low tax effect after CBDT Circular 5/2024 and audit-objection exception . Its practical value lies in the interaction between the statutory text, the evidentiary record and the procedural route followed in this case.
What could make this judgment distinguishable or unsafe to rely on?
The packaged PDF is not yet an issuing-authority certified copy Apply the statutory law applicable to the relevant year; later amendments can change the result. Check whether a later High Court or Supreme Court judgment has affirmed, distinguished, reversed or superseded this decision.
Can this judgment be cited as current law without another check?
Tribunal precedent. Persuasive for similar facts; subject to the jurisdictional High Court and Supreme Court. Coordinate-Bench discipline should be checked. Subsequent appellate history is not fully closed in the current ledger. Recheck before filing or opinion work. A sanitized local full-text judgment copy is packaged; official-primary replacement remains pending.
Section / provision impact
- 268A — 268A is part of the statutory framework considered in the context of low tax effect after cbdt circular 5/2024 and audit-objection exception. Read the exact provision applicable to the relevant year with the Court/Tribunal reasoning.
How the decision changes your analysis
Before using this authority, frame the issue under 268A and identify the decisive facts/evidence. The result should not be assumed from the case title alone.
The decision turns on Low tax effect after CBDT Circular 5/2024 and audit-objection exception. The operative result is classified as Operative order controls. Read the rule only with the statutory version, factual findings and precedent chain recorded in the full judgment.
Tribunal precedent. Persuasive for similar facts; subject to the jurisdictional High Court and Supreme Court. Coordinate-Bench discipline should be checked. Subsequent appellate history is not fully closed in the current ledger. Recheck before filing or opinion work.
Case network: similar and different outcomes
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Related cases with a different result
Related-case links are repository similarity connections, not a claim that one judgment cites or overrules another. Use the cited-authority list and later-history check for formal precedent analysis.
Working-paper citation
Full judgment and source trail
Read / download the clean local judgment copy
| Packaged source class | SANITIZED_LOCAL_FULL_JUDGMENT_COPY_PRIMARY_PENDING |
|---|---|
| Pages | 8 |
| SHA-256 | 0eadba4db9c5798eab4bf65ec6ec1a22a1bd82b2a4d451fe5bac359b9cdd9e87 |
| Original source URL | Not exposed publicly. Original provenance retained only in the private source-closure ledger. |
| Source authentication | Sanitized local full-text copy - official primary replacement pending |