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TMI Blog2014 (12) TMI 755X X X X Extracts X X X X X X X X Extracts X X X X ..... ng instructions fixing the monetary limit for the tax effect would hold good even for pending cases – revenue could not point out any of the exceptions - this being a low tax effect case, the appeal cannot be admitted – Decided against revenue. - I.T.A. No. 1244/KOL/ 2010 - - - Dated:- 17-12-2014 - Shri Shamim Yahya And Shri George Mathan,JJ. For the Petitioner : Shri Uday Kumar Sardar, JCIT, Sr. D.R. For the Respondent : Shri Surrendra Joshi, C.A. ORDER Per George Mathan: This is an appeal filed by the Revenue against the order of ld. Commissioner of Income Tax (Appeals)-VI, Kolkata in Appeal No. 516/CIT(A)-VI/08-09/Ward-7(4) dated 29.03.2010 for the assessment year 2003-04. 2. Shri Uday Kumar Sardar, JCIT, Sr. D.R. represented on behalf of the Revenue and Shri Surrendra Joshi, C.A., represented on behalf of the assessee. 3. At the outset, it was stated by Ld. Counsel for the assessee that tax effect in this appeal of Revenue is below the prescribed monetary limits for filing of appeal before ITAT. The appeal relates to Assessment Year 2003-04 and filed before the Tribunal on 16.06.2010. Ld Counsel for the assessee stated that in view of the rec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ruary, 2011. Hon ble High Court has considered this issue as under:- 6. The question about applicability of Instruction No.3 of 2011 had been considered and decided by the Aurangabad Bench of the Bombay High Court in Tax Appeal No. 78 of 2007, The Commissioner of Income Tax v. Smt. Vijaya V. Kavekar decided on 29.7.2011. The Division Bench, after considering earlier Instructions and various decisions of the Courts on Instructions, relying on the decision in Commissioner of Income Tax vs. Madhukar K. Inamdar (HUF) reported in (2010) 229 CTR (Bom) 77, has held in paragraphs 9, 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. I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 8 and in compliance thereof, they do not file appeals, if the tax effect is less than ₹ 4 Lakhs; but the said circular is not applicable to the cases filed prior to 15th May, 2008 i.e. to the old pending appeals, even if the tax effect is less than ₹ 4 Lakhs. In our view, there is no logic behind this belief entertained by the Revenue. The Court has further held that the prevailing instructions fixing the monetary limit for the tax effect would hold good even for pending cases. Accordingly, the Court dismissed all the appeals having a tax 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... etary limit, without expressing any opinion on the merits of the claim, making it clear that the Department is at liberty to proceed against the assessee in future, if there any amount due from the assessee, on similar issue and if it is above the monetary limit prescribed. 5. I find from the above case law of Hon ble Gujarat High Court in the case of Sureshchandra Durgaprasad Khatod (HUF), (supra) that in the similar situation and exactly identical instructions were applied to the appeal filed retrospectively. Hon ble Gujarat High Court 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... led in respect of an assessment year or years in which the tax effect is less than the monetary limit specified in para 3. In other words, henceforth, appeals can be filed only with reference to the tax effect in the relevant assessment year. However, in case of a composite order of any High Court or appellate authority, which involves more than one assessment year and common issues in more than one assessment year, appeal shall be filed in respect of all such assessment years even if the tax effect is less than the prescribed monetary limits in any of the year(s), if it is decided to filed appeal in respect of the year(s) in which tax effect exceeds the monetary limit prescribed. In case where 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 thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... w and Justice. 10. The monetary limits specified in para 3 above shall not apply to writ matters and direct tax matters other than Income tax. Filing of appeals in other Direct tax matters shall continue to be governed by the relevant provisions of statute rules. Further filing of appeal in cases of Income Tax, where the tax effect is not quantifiable or not involved, such as the case of registration of trusts or institutions under section 12 A of the IT Act, 1961, shall not be governed by the limits specified in par 3 above and decision to file appeal in such cases may be taken on merits of a particular case. 11. This instruction will apply to appeals filed on or after 10th July, 2014. However, the cases where 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. 6. 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) tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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