2020 (5) TMI 358 - AT - Income Tax

Maintainability of appeal - low tax effect - computation of tax effect - HELD THAT - As relying on KESHAV POWER LTD. 2019 (8) TMI 811 - SC ORDER since the tax effect involved in the matter is less than threshold limit going by the latest circular issued by the CBDT, we see no reason to interfere in this matter. The Special Leave Petition is dismissed.

Summary

Issues:
- Appeal filed by Revenue against the order of the Commissioner of Income Tax
- Tax effect not exceeding ?50,00,000 in the appeals
- CBDT circular No.17/2019 liberalizing policy for not filing appeals below certain threshold limits
- Dismissal of appeals as withdrawn based on the CBDT circular
- Enhancement of monetary limits for filing appeals in income-tax cases
- Application of circular to pending appeals
- Judicial precedent of the Hon'ble Supreme Court regarding the circular
- Liberty granted to point out exceptions and seek recall of dismissed appeals
- Non-maintainability of the appeals based on the principles laid down by the Supreme Court

Detailed Analysis:
1. The appeals were filed by the Revenue against the consolidated order of the Commissioner of Income Tax for the assessment years 2011-12, 2012-13, 2013-14, and 2014-15. It was noted that the tax effect involved in all four appeals did not exceed ?50,00,000.

2. The CBDT circular No.17/2019, dated 8th August 2019, introduced a more liberalized policy for not filing appeals against decisions favorable to taxpayers where the tax involved is below certain threshold limits. This circular aimed to manage litigation effectively and avoid unnecessary appeals in cases with lower tax implications.

3. The circular specified monetary limits for filing appeals in income-tax cases before different appellate authorities. It also provided guidelines on how to handle disputed issues arising in multiple assessment years, emphasizing the calculation of tax effect separately for each assessment year.

4. The circular was to be read in conjunction with the previous circular No. 3/2018 and its subsequent amendments. The modifications introduced by the circular aimed to streamline the process of filing appeals and ensure consistency in dealing with tax disputes across different levels of appellate authorities.

5. The Hon'ble Supreme Court, in a related case, applied the CBDT circular No.17/2019 and dismissed an appeal where the tax effect was below the specified threshold limit. This judicial precedent further supported the application of the circular in determining the maintainability of appeals based on the tax implications involved.

6. The Tribunal acknowledged the liberty granted to point out exceptions and seek recall of dismissed appeals if they were inadvertently included or if the tax effect exceeded the prescribed limit due to miscalculations or other valid reasons. This provision allowed for a fair review of cases falling outside the general guidelines provided by the circular.

7. Based on the principles established by the Supreme Court and considering the CBDT circular, the Tribunal found that the appeals filed by the Revenue were non-maintainable due to the tax effect being below the specified threshold limit. Therefore, all four appeals for the respective assessment years were dismissed accordingly.