2019 (12) TMI 348 - AT - Income Tax

Maintainability of appeal - monetary amount involved in filing of the appeal - CBDT circular No.17/2019 in F.No.279/Misc.142/2007ITJ(Pt) dated 8th August, 2019 - HELD THAT - The circular dated 8th August 2019 is not a standalone circular. It is to be read in conjunction with the CBDT circular No. 3/2018 (and subsequent amendment thereto), and all it does is to replace paragraph nos. 3 and 5 of the said circular. The Hon ble Supreme Court in the case of THE PR. COMMISSIONER OF INCOME TAX-5, NEW DELHI VERSUS KESHAV POWER LTD. 2019 (8) TMI 811 - SC ORDER has also applied the Circular No.17/2019 dated 08.08.2019 has dismissed the appeal holding Since the tax effect involved in the matter is less than ₹ 2/- crores, going by the latest circular issued by the CBDT, we see no reason to interfere in this matter. The appeal filed by the Revenue is found to be non-maintainable - the appeal of Revenue stands dismissed as withdrawn.

Summary

Issues involved: Appeal against the order of the Commissioner of Income-tax (Appeals) for the assessment year 2014-15 based on the tax effect, CBDT circular No.17/2019 liberalizing the policy for not filing appeals below a certain threshold, interpretation and application of the circular, and the dismissal of the appeal by the Revenue.

Analysis:

1. Appeal Against CIT(A) Order:
- The appeal was filed by the Revenue against the order of the Commissioner of Income-tax (Appeals)-4, Chennai for the assessment year 2014-15.

2. Tax Effect and CBDT Circular No.17/2019:
- The tax effect involved in the appeal did not exceed ?50 lakhs, as admitted by both parties.
- The CBDT circular No.17/2019, dated 8th August 2019, further liberalized the policy for not filing appeals against decisions in favor of taxpayers below certain threshold limits.
- The circular specified monetary limits for filing appeals in income-tax cases before different appellate authorities.

3. Interpretation of CBDT Circular:
- The circular dated 8th August 2019 was not standalone but to be read in conjunction with the earlier circular No. 3/2018, replacing certain paragraphs.
- It was clarified that the circular applied to pending appeals as of the date of issuance and provided further relaxation in monetary limits.

4. Application of Circular and Judicial Precedent:
- The Hon'ble Supreme Court in a related case dismissed an appeal based on the tax effect being below ?2 crores, in line with the CBDT circular.
- The Tribunal accepted the Revenue's request for liberty to point out cases inadvertently included in the appeal where the tax effect exceeded ?50 lakhs due to exceptions or errors.

5. Dismissal of Appeal:
- Following the principles laid down by the Supreme Court, the Tribunal found the appeal filed by the Revenue to be non-maintainable and dismissed it as withdrawn.
- The order was pronounced in open court on 28th August 2019 in Chennai.

This detailed analysis covers the issues surrounding the appeal, the application and interpretation of the CBDT circular, the dismissal of the appeal based on the tax effect, and the relevant judicial precedents cited during the proceedings.