2019 (5) TMI 1507 - HC - Income Tax

Monetary limit - maintainability of appeal - applicant permission to withdraw the appeal in the light of the circular dated 11th July, 2018 - HELD THAT - From the facts noted hereinabove, it is evident that on account of inadvertent error, despite the fact that the captioned appeal was covered by paragraph 5 of the above referred CBDT circular, the tax appeal came to be withdrawn. The application, therefore, requires consideration and the appeal deserves to be restored. For the foregoing reasons, the application succeeds and is, accordingly, allowed.

Summary

Issues:
Recall of order based on CBDT circular regarding low tax effect in composite order appeal.

Analysis:
The judgment pertains to an application seeking the recall of an order passed by the court allowing the withdrawal of a tax appeal due to low tax effect. The applicant argued that the appeal was against a composite order of the Income Tax Appellate Tribunal and fell under the CBDT circular's provision, allowing appeals for years with tax effect exceeding the limit. The tax effect for the appeal in question was above the prescribed limit, justifying the recall of the order. The court noted the inadvertent error in allowing the withdrawal despite the appeal falling under the CBDT circular's provision. Consequently, the court found merit in the application, allowing the recall of the order and restoring the tax appeal to the file.

This judgment highlights the importance of correctly applying the provisions of CBDT circulars, especially in cases involving composite orders with common issues across multiple assessment years. The court's decision underscores the need for a thorough review to prevent inadvertent errors that may lead to the withdrawal of appeals that are eligible for consideration under relevant circulars. The court's approach in rectifying the error and restoring the appeal demonstrates a commitment to ensuring the proper adjudication of cases in line with applicable legal provisions and guidelines.

Overall, the judgment serves as a reminder of the significance of adherence to procedural requirements and the careful consideration of relevant circulars and guidelines in matters concerning the withdrawal and restoration of appeals based on tax effect thresholds. The court's decision to recall the order and restore the appeal underscores the commitment to upholding the principles of justice and fairness in tax matters, particularly when procedural errors impact the proper adjudication of cases.