2019 (10) TMI 345 - AT - Income Tax

Monetary limit - low tax effect - retrospective effect of the CBDT circular - HELD THAT - In view of the CBDT Circular No.17/2019 dated 8th August, 2019 having retrospective effect as coordinate Bench of the Tribunal in case of Dinesh Madhavlal Patel 2019 (8) TMI 752 - ITAT AHMEDABAD has already decided the issue as to the applicability of the captioned circular to the pending appeals in affirmative and what has been discussed above, we are of the considered view that the aforesaid appeal is not maintainable because of low tax effect i.e. less than ₹ 50,00,000/- hence, the aforesaid appeal filed by the Revenue is hereby dismissed having been become infructuous. However, in case, the present appeal is found to be maintainable at any stage for any technical reasons, the Department shall be at liberty to seek recall of this order under relevant provisions of law.

Summary

Issues involved:
1. Appeal filed by the Revenue seeking to set aside the order passed by the Commissioner of Income-tax (Appeals) for the assessment year 2012-13.
2. Interpretation of CBDT Circular No.17/2019 regarding the monetary limit for filing appeals in income tax cases before the Tribunal, High Courts, and Supreme Court.
3. Application of the CBDT Circular with retrospective effect to pending appeals.
4. Decision on the maintainability of the appeal based on the tax effect being less than ?50,00,000.

Detailed Analysis:
1. The appeal was filed by the Revenue to challenge the order passed by the Commissioner of Income-tax (Appeals) for the assessment year 2012-13. However, it was noted that the appeal had a low tax effect as per the CBDT Circular No.17/2019, which directs the Revenue not to prefer appeals if the tax effect is less than ?50,00,000. Both the Departmental Representative and the Authorized Representative acknowledged this fact. The Authorized Representative argued for the appeal's dismissal based on the Circular's provisions.

2. The CBDT Circular revised the monetary limits for filing appeals in income tax cases before different appellate authorities. The Circular specified the monetary limits as ?50,00,000 before the Appellate Tribunal, ?1,00,00,000 before the High Court, and ?2,00,00,000 before the Supreme Court. The Circular aimed to manage litigation effectively and provide clarity on the filing of appeals based on the tax effect of the disputed issues.

3. The Tribunal considered the retrospective effect of the CBDT Circular No.17/2019, which was affirmed in a previous case. The decision was made in line with the Circular's provisions and the Tribunal's interpretation of its applicability to pending appeals. The Tribunal concluded that the appeal in question was not maintainable due to the low tax effect being less than ?50,00,000. Consequently, the appeal filed by the Revenue was dismissed as it had become infructuous. However, the Department was given the option to seek a recall of the order if the appeal was found to be maintainable for any technical reasons at a later stage.

In summary, the judgment delved into the issues surrounding the appeal filed by the Revenue, the interpretation and application of the CBDT Circular regarding monetary limits for filing appeals in income tax cases, and the decision on the appeal's maintainability based on the tax effect criteria outlined in the Circular. The Tribunal's decision to dismiss the appeal due to the low tax effect in compliance with the Circular's provisions was a significant aspect of the judgment.