2025 (2) TMI 835 - HC - Income Tax

Maintainability of appeal on low tax effect - assessee submits that the tax effect in these appeals is less than Rs. 2 Crores; therefore these appeals should be disposed of - HELD THAT - As held in V.M. Salgaonkar and Brothers (P.) Ltd 2024 (12) TMI 717 - BOMBAY HIGH COURT concerning M/s IPL Loan Trust and connected matters 2025 (2) TMI 453 - BOMBAY HIGH COURT and Axis AD Print Media (India) Ltd.) 2025 (2) TMI 770 - BOMBAY HIGH COURT and connected appeals hold that the monetary limits prescribed in CBDT circulars would apply to pending appeals. Still the exceptions carved out by the CBDT circulars would apply only prospectively i.e. from the date of the introduction of such exception. Admittedly before 20 August 2018 these appeals were not covered by any exceptions. However these appeals were filed because they were beyond the monetary limits prescribed then. The monetary limits have now been revised. These revised monetary limits would also apply to the pending appeals as held in the above precedents. By applying the revised monetary limits to the pending appeals and noting that the exception upon which the Revenue relies was unavailable before 20 August 2018 we uphold the objection on behalf of the assessee and dispose of these two appeals without any cost orders. These appeals are disposed of because the tax effect is within the monetary limits set out by the CBDT.

Summary

The Bombay High Court heard two Income Tax Appeals where the tax effect was contested. The Revenue argued that despite the tax effect exceeding the previous monetary limits, exceptions applied due to a CBDT letter dated 20 August 2018. The Court referenced precedents stating that revised monetary limits apply to pending appeals, but exceptions only apply prospectively. Since the exceptions were unavailable before 20 August 2018, the Court upheld the assessee's objection and disposed of the appeals without costs, as the tax effect fell within the revised monetary limits. The Court closed the appeals based on the monetary limits but left the questions of law open for future consideration.