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TMI Blog2009 (12) TMI 444X X X X Extracts X X X X X X X X Extracts X X X X ..... MEHINDER SINGH SULLAR JJ JUDGMENT The judgment of the court was delivered by 1. Satish Kumar Mittal J.-This appeal has been filed by the Revenue under section 260A of the Income-tax Act, 1961 (hereinafter referred to as "the Act") against the order dated September 7, 2007 passed by the Income-tax Appellate Tribunal, Amritsar Bench, Amritsar in I. T. A. No. 12(ASR)2005, for the assessment year 2000-01 raising the following substantial question of law : "(i) Whether on the facts and circumstances of the case, the hon'ble Income-tax Appellate Tribunal is correct in law in holding that repayment of loan against residential house more than one year or within one year of transfer of long-term capital asset qualifies for exemption under section 54F of Income-tax Act, 1961 ?" 2. In the present appeal, the assessee is an individual and deriving income from LPG distributorship. For the assessment year 2000-01, the assessee filed his return declaring his income of Rs. 2,25,710. The Assessing Officer, vide its order dated March 25, 2003, framed the assessment under section 143(3) of the Act at an income of Rs. 7,60,580 while disallowing the claim of exemption of Rs. 4,04,664 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal was filed, i.e., Circular No. 5 of 2008. While referring to these provisions, learned counsel argued that since in the instant case the appeal was filed prior to May 15, 2008, therefore, the same is to be governed by clause 3 of Circular No. 5 of 2008 and since in the instant appeal the question of law is of recurring nature, therefore, the same should be decided on the merits. Learned counsel further argued that the impact of clause 10 of Circular No. 5 of 2008 was not considered by this court in CIT v. Oscar Laboratories P. Ltd. [2010] 324 ITR 115 (P H) ; [2009] 222 CTR (P H) 546, therefore, the ratio of that judgment is not applicable in the instant appeal. 7. While controverting the aforesaid contention of the learned counsel for the Revenue, learned counsel for the assessee argued that in the instant case the disputed issue is not of recurring nature and the same is not arising in more than one assessment year, therefore, the contention of the learned counsel for the Revenue that since in the case of the assessee the issue is of recurring nature, therefore, it should be separately dealt with on the merits, cannot be accepted. Learned counsel further argued that even if t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n monetary limits for filing of appeals are mandatory and binding on the Revenue. The contention of the learned counsel for the Revenue that Circular No. 5 of 2008 is not applicable on the appeals filed prior to May 15, 2008, cannot be accepted. The similar issue has been considered by the Bombay High Court in CIT v. Madhukar K. Inamdar (HUF) [2009] 318 ITR 149 wherein it was held that Circular No. 5 of 2008 is also applicable on the pending appeals, irrespective of the fact whether the same were filed before or after May 15, 2008. In this regard the Bombay High Court made the following observations (page 150) : "It cannot be disputed that the Central Board of Direct Taxes Circular dated May 15, 2008, has no retrospective effect. It operates from the date of its issuance. As a corollary thereof, the appeals which come on board for consideration after the issuance of the Central Board of Direct Taxes Circular dated May 15, 2008, needs to be considered in the light of the said Circular. Application of the said Circular to the cases coming on board after May 15, 2008, by no stretch of imagination can be said to be an application of Circular with retrospective effect. 10. In order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t has acquiesced in the decision on the disputed issues.' (emphasis supplied) 13. The aforesaid judicial verdict makes it clear that the Circular dated May 15, 2008, in general and paragraph (5) thereof in particular lay down that even if the same issue, in respect of the same assessee, for other assessment years is involved, even then the Department should not file appeal, if the tax effect is less than Rs. 4 lakhs. In other words, even if the question of law is of recurring nature even then, the Revenue is not expected to file appeals in such cases, if the tax impact is less than the monetary limit fixed by the Central Board of Direct Taxes. 14. One fails to understand how the Revenue, on the face of the above clear instructions of the Central Board of Direct Taxes, can contend that the Circular dated May 15, 2008, issued by the Central Board of Direct Taxes is applicable to the cases filed after May 15, 2008, and in compliance thereof, they do not file appeals, if the tax effect is less than Rs. 4 lakhs ; but the said circular is not applicable to the cases filed prior to May 15, 2008, i.e., to the old pending appeals ; even if the tax effect is less than Rs. 4 lakhs. In our ..... X X X X Extracts X X X X X X X X Extracts X X X X
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