2019 (11) TMI 1785 - AT - Income Tax

Maintainability of appeal before ITAT on low tax Effect - HELD THAT - As taking a note of CBDT Circular No. 17/2019 dated 8th August, 2019 and considering the fact that the tax effect in the instant appeal is less than Rs.50 lakh, the present appeal deserves to be dismissed, as not maintainable. The issue(s) raised in the instant appeal is left open to be examined in the appropriate proceedings, if arises, in future - if the appeal falls in any of the exceptions referred to in the above said CBDT Circular, the Revenue is at liberty to move an application for recalling the order, if so, advised. Appeal filed by the Revenue is dismissed.

Summary

Issues involved:
- Jurisdiction of ITAT Cochin regarding appeal by Revenue against CIT(A) order dated 03.07.2017 for AY 2007-2008.
- Applicability of CBDT Circular No. 17/2019 dated 8th August, 2019 on tax effect limit for filing appeals.
- Dismissal of appeal by ITAT Cochin due to tax effect being less than Rs. 50 lakh.
- Provision for future examination of issues raised in the appeal if necessary.

Analysis:
1. The judgment by the ITAT Cochin, delivered by Shri George George K, JM, concerned an appeal by the Revenue against the order of the Commissioner of Income-tax (Appeals) dated 03.07.2017 for the assessment year 2007-2008.

2. The crucial aspect highlighted in the judgment was the application of Circular No. 17/2019 dated 8th August, 2019, issued by the Central Board of Direct Taxes (CBDT), which revised the monetary limit for filing appeals by the Revenue. The Circular emphasized that appeals where the tax effect does not exceed Rs. 50 lakh should not be filed to reduce tax litigation.

3. Considering the tax effect in the present appeal was less than Rs. 50 lakh, the ITAT Cochin, in adherence to the CBDT Circular, dismissed the appeal as not maintainable. However, the judgment clarified that the issues raised in the appeal could be examined in future proceedings if required, and the Revenue could seek a recall of the order if falling within exceptions mentioned in the Circular.

4. Consequently, the ITAT Cochin, in line with CBDT Circular No. 17/2019, dismissed the appeal filed by the Revenue on 19th November 2019, based on the grounds of the tax effect being below the specified limit. This decision underscored the importance of adhering to the revised monetary limits set by the CBDT to streamline tax litigation and prioritize cases based on their financial impact.