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TMI Blog2014 (12) TMI 427X X X X Extracts X X X X X X X X Extracts X X X X ..... Churu u/s. 250/143(3) of the Income-tax Act, 1961 (hereinafter referred to as "the Act") for Assessment Year 1996-97 vide his order dated 25.02.2002. 2. At the outset, Ld. Counsel for the assessee stated that tax effect in this appeal of Revenue is below the prescribed monetary limits for filing of appeals before ITAT. In this appeal of Revenue, the quantum involved is ₹ 12,16,733/- on which total tax effect is ₹ 2,76,896/-, which is below ₹ 4 lakhs. The appeal relates to Assessment Year 1996-97and filed before the Tribunal on 23.05.2012. Ld Counsel for the assessee stated that in view of the recent Instruction No. 5/2014 issued by CBDT on 10.07.2014 revising monetary limits for filing of appeal before ITAT fixing the tax effect limit of ₹ 4 lacs, the same is not maintainable and liable to be dismissed in limine. The only issue now remains before us is, whether, this appeal of revenue, which is below the prescribed limit of tax effect in view of the Board's Instruction No.5/2014 issued on 10.07.2014 revising the monetary limits for filing of appeals by the Department before ITAT is maintainable or not. Ld. SR-DR drew our attention to para-11 of the Instruc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10, 11, 14 and 17 as under: "9. As stated earlier, the Income Tax Act was amended and Section 268A has been introduced on the Statute book with retrospective effect. Section 268A carves out an exception for filing of appeals and References under Section 260 A of the Act. The legislature has prescribed that the CBDT is empowered to issue circulars and instructions from time to time, with regard to filing of appeals depending on the tax effect involved. Thereafter, in 2008, CBDT Instruction No. 5 of 2008 dated 15th May, 2008 was issued. This Court in the case of "Commissioner of Income Tax V/s Madhukar K. Inamdar (HUF) reported in "(2010) 229 CTR (Bom) 77, interpreted the aforesaid Circular. The Circular was issued in supersession of all earlier instructions issued by the Board. The monetary limit was increased and appeals were to be filed under Section 260A, thereafter, only in cases where the tax effect exceeded ₹ 4 Lacs. Paragraph 11 of that instruction stipulated that it was applicable to appeals filed on or after 15th May, 2008. It was further provided that in cases, where appeals were filed before 15th May, 2008, they would be governed by the instruction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... effect of less than ₹ 4 Lacs. 10. The new CBDT instructions have been issued on 9th February, 2011, being Instruction no. 3 of 2011. The monetary limit has been raised again and clause 3 of the instructions provides that appeals shall not be filed in cases where the tax effect does not exceed the monetary limits prescribed, henceforth. The monetary limits prescribed for filing an appeal under Section 260A before the High Court has been raised to ₹ 10 Lacs. This instruction is identical to the CBDT Instruction no. 5 of 2008. Clause 10 of this circular indicates that monetary limits would not apply to writ matters and direct tax matters other than income tax. It further provides that where the tax effect is not quantifiable, the Department should take a decision to file appeals on merits of each case. Clause 11, again provides that the instruction would apply to appeals filed on or after 07.02.2011 and appeals filed before 07.02.2011 would be governed by the instructions on this subject, operative at the time when such appeals were filed. 11. In our opinion, when a similar clause has been interpreted by the Division Bench of this Court in CIT vs. Madhukar Inamdar (Supra ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... urt has discussed that almost all High Courts are of the unanimous view, considering the main objective of such instructions that to reduce the pending litigation, where the tax effect is considerable low or small, the appeal is not maintainable. The recent instruction revising the monetary limit to ₹ 4 lakh for filing appeal before ITAT on income tax matters, as issued vide Instruction No.5/2014 FNo279/Misc.142/2007-ITJ(Pt) dated 10th July, 2014 will apply to pending appeals also for the reason that the same is exactly identical to earlier instructions. The relevant circular issued by CBDT reads as under: "Reference is invited to Board's instruction No 3/2011 dated 09/02/2011 wherein monetary limits and other conditions for filing departmental appeals (in income-tax matters) before Appellate Tribunal, High Courts and Supreme Court were specified. 2. In supersession of the above instruction, it has been decided by the Board that departmental appeals may be filed on merits before Appellate Tribunal, High Courts and Supreme Court keeping in view the monetary limits and conditions specified below. 3. Henceforth appeals shall not be filed in cases where the tax effect does not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a composite order / judgment involves more than one assessee, each assessee shall be dealt with separately. 6. In a case where appeal before a Tribunal or a Court is not filed only on account of the tax effect being less than the monetary limit specified above, the Commissioner of Income-tax shall specifically record that "even though the decision is not acceptable, appeal is not being filed only on the consideration that the tax effect is less than the monetary limit specified in this instruction". Further, in such cases, there will be no presumption that the Income-tax Department has acquiesced in the decision on the disputed issues. The Income-tax Department shall not be precluded from filing an appeal against the disputed issues in the case of the same assessee for any other assessment year, or in the case of any other assessee for the same or any other assessment year, if the tax effect exceeds the specified monetary limits. 7. In the past, a number of instances have come to the notice of the Bard, whereby an assessee has claimed relief from the Tribunal or the Court only on the ground that the Department has implicitly accepted the decision of the Tribunal or Court in the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re appeals have been filed before 10th July, 2014 will be governed by the instructions on this subject, operative at the time when such appeal was filed. 12. This issue under Section 268A (1) of the Income-tax Act 1961." 5. On query from the Bench, the Ld. DR could not point out any of the exceptions as provided in the Circular as under: (a) that this is a loss case having tax effect more than the prescribed limit, which should be taken into account, (b) that this is a composite order for many assessment years where tax effect will be more than the prescribed limit as per para 5 of above instructions, (c) that this is a case, where, in the case of revenue, where constitutional validity of the provision of the Act or I.T. Rules 1962 are under challenge, (d) that Board's order, Notification, Instruction or Circular has been held to be illegal or ultra vires, (e) that Revenue Audit Objection in the case has been accepted by the Department and the same is under challenge. The Ld. DR could not point out any of the exceptions as provided above. Accordingly, this being a low tax effect case, we dismiss the appeal of the revenue in limine without going into merits. 6. In the resul ..... X X X X Extracts X X X X X X X X Extracts X X X X
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