2019 (10) TMI 1368 - AT - Income Tax

Monetary limit - Maintainability of appeal of revenue - low tax effect - HELD THAT - We find that the tax effect involves in the appeal of the Revenue is below ₹ 50 lakhs. There is no dispute that the Board s instructions or directions issued to the Income-tax authorities are binding on those authorities, therefore, the Department should have withdrawn/not pressed the present appeal in view of the aforesaid instruction since the tax effect in the instant appeal is less than the amount of ₹ 50 lakhs. In view of the above, Circular No. 17/2019 dated 08/08/2019 will apply to all pending appeals. Therefore the precedent, it is held that the appeal is not maintainable in the instant case as the tax effect is less than ₹ 50 lakhs. Accordingly, it is held that appeal filed by the revenue is not maintainable.

Summary

Issues:
- Appellate Tribunal ITAT Delhi judgment on appeals by Revenue against CIT(A) orders for different assessees regarding tax effect below ?50 lakhs.

Analysis:
1. The appeals by the Revenue were against orders passed by the CIT(A) for various assessees and different assessment years. The Revenue sought to challenge these orders before the ITAT Delhi.

2. During the hearing, the ld. DR highlighted Circular No. 17/2019 dated 08th August 2019 issued by the CBDT, which stated that the revenue should not prefer appeals before the Tribunal if the tax effect is less than ?50 lakhs. The Revenue requested the appeal be decided in accordance with this instruction.

3. The CBDT circular enhanced the monetary limit for filing appeals in income-tax cases before the ITAT, High Courts, and the Supreme Court. The circular specified new monetary limits for filing appeals at different levels, with the ITAT limit set at ?50 lakhs. This circular aimed to manage litigation effectively.

4. The ITAT noted that the tax effect involved in the Revenue's appeal was below ?50 lakhs, as per the CBDT circular. Considering that the Board's instructions are binding on tax authorities, the Department should have withdrawn the appeal due to the tax effect being below the specified limit. The applicability of the circular to pending appeals was clarified in a previous judgment.

5. The ITAT held that Circular No. 17/2019 would apply to all pending appeals, including the present case, where the tax effect was less than ?50 lakhs. Consequently, the appeal filed by the Revenue was deemed not maintainable. The ITAT also allowed the Revenue the liberty to file a miscellaneous application if instances mentioned in a previous circular were identified with proper evidence.

6. As a result, the appeals filed by the Revenue were dismissed by the ITAT Delhi. The order was pronounced in open court on 14th October 2019, in line with the CBDT circular's directives and the ITAT's decision regarding the tax effect threshold for appeals.