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Relaxation in monetary limits for filing Departmental appeals as per CBDT Circular 17/2019 has retrospective effect: ITAT

2019-TIOL-1674-ITAT-DEL

IN THE INCOME TAX APPELLATE TRIBUNAL
BENCH ‘D’ NEW DELHI

ITA No.130/Del/2016
Assessment Year: 2006-07

INCOME TAX OFFICER
WARD-1(1), NEW DELHI

Vs

AAR PEE APARTMENTS PVT LTD
M-132, ADINATH SHREE HOUSE
CONNAUGHT CIRCUS, NEW DELHI
PAN NO:AAACA7224M

C O No. 158/Del/2016
In ITA No. 2596/Del/2016
Assessment Year: 2011-12

AAR PEE APARTMENTS PVT LTD
M-132, ADINATH SHREE HOUSE
CONNAUGHT CIRCUS, NEW DELHI
PAN NO:AAACA7224M

Vs

INCOME TAX OFFICER
WARD-1(1), NEW DELHI

Prashant Maharishi, AM & K N Chary, JM

Date of Hearing: August 20, 2019
Date of Decision: August 20, 2019

Appellant Rep by: Ms Pramita M Bisawas, CIT DR
Respondent Rep by: 
Shri Rohit Tiwari, Adv.

Income tax – CBDT Circular No. 17/2019 – Relaxation in monetary limits

THE Revenue has preferred the present appeal before the Tribunal challenge the correctness of the relief granted to assessees by the CIT(A) officers, more so where the tax amount involved in each matter does not exceed Rs 50 lakhs.

On appeal, the Tribunal held that,

Whether the relaxation in monetary limits for filing Departmental appeals as per the relevant CBDT Circular17/2019 , has retrospective effect and also applies to appeals pending for disposal – YES: ITAT

Whether Revenue’s appeal merit being dismissed as withdrawn, as the tax value involved is lower than prescribed limit of Rs 50 lakhs – YES: ITAT

++ the Board’s instructions or directions issued to the Income-tax authorities are binding on those authorities, therefore, the Department should have withdrawn/not pressed the present appeal in view of the instruction since the tax effect in the present appeal is less than the amount of Rs. 50 lakhs. Further, it is pertinent to note, Circular No. 17/2019 will apply to all pending appeals. Accordingly, it is held the appeal filed by the revenue is not maintainable. Tribunal also hastened to add certain times instances of the CBDT Circular No. 3/2018 is not discernable from the assessment and appellate orders, therefore, in such cases, Tribunal also give liberty to revenue, if such instances comes to their notice than, revenue may file miscellaneous application with such evidences.

Revenue’s appeal dismissed

Case followed:

ITO v. Dinesh Madhavlal Patel – 2019-TIOL-1556-ITAT-AHM

ORDER

Per: Bench:

1. This is an appeal filed by the revenue and the cross objection filed by the assessee against the order of the ld CIT(A)-I, New Delhi dated 19.10.2015 for the Assessment Year 2006-07.

2. At the outset of the hearing itself, the ld. ARs brought to our attention that CBDT vide Circular No. 17/2019 dated 08th August 2019 has decided that the revenue would not prefer any appeal before the Tribunal if the tax effect is less than Rs. 50 lakhs. Therefore, he pleaded that the appeal of the revenue be decided as per the Instruction of the CBDT.

3. The ld DRs vehemently objected to the same and submitted that it applies prospectively and not to pending appeals.

4. We have heard the contention of rival parties and perused the material on record. We find that the CBDT vide Circular No. 17/2019 dated 08th August 2019 has enhanced the monetary limit for filing the appeal by the department before Income Tax Appellate Tribunal, Hon’ble High Courts and Hon’ble Supreme Court. The relevant para of the aforesaid circular is reproduced as under :-

“2. As a step towards further management of litigation, it has been decided by the Board that monetary limits for filing of appeals in income-tax cases be enhanced further through amendment in Para 3 of the Circular mentioned above and accordingly, the table for monetary limits specified in Para 3 of the Circular shall read as follows:

S.No.Appeals/SLPs in Income-tax mattersMonetary Limit (Rs.)
1.Before Appellate Tribunal50.00,000
2.Before High Court1.00.00.000
3.Before Supreme Court2.00,00.000

3. Further, with a view to provide parity in filing of appeals in scenarios where separate order is passed by higher appellate authorities for each assessment year vis-a-vis where composite order for more than one assessment years is passed, para 5 of the circular is substituted by the following para:

“5. The Assessing Officer shall calculate the tax effect separately for every assessment year in respect of the disputed issues in the case of every assessee. If, in the case of an assessee. the disputed issues arise in more than one assessment year, appeal can be filed in respect of such assessment year or years in which the tax effect in respect of the disputed issues exceeds the monetary’ limit specified in para 3. No appeal shall be filed in respect of an assessment year or years in which the tax effect is less than the monetary limit specified in para 3. Further, even in the case of 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, no appeal shall be filed in respect of an assessment year or years in which the tax effect is less than the monetary limit specified in para 3. In case where a composite order/ judgement involves more than one assessee. each assessee shall be dealt with separately.”

4. The said modifications shall come into effect from the date of issue of this Circular.

5. The same may be brought to the notice of all concerned.

6. This issues under section 268A of the Income-tax Act, 1961.”

5. We find that the tax effect involves in the appeal of the Revenue is below Rs. 50 lakhs. There is no dispute that the Board’s instructions or directions issued to the Income-tax authorities are binding on those authorities, therefore, the Department should have withdrawn/not pressed the present appeal in view of the aforesaid instruction since the tax effect in the instant appeal is less than the amount of Rs. 50 lakhs. The issue of applicability of the above circular to pending appeals has been decided by the coordinate bench in Dinesh Madhavlal Patel [TS- 469-ITAT-2019(Ahd)] – 2019-TIOL-1556-ITAT-AHM dated 14th August, 2019 .

5. In view of the above, Circular No. 17/2019 dated 08/08/2019 will apply to all pending appeals. Therefore the precedent, it is held that the appeal is not maintainable in the instant case as the tax effect is less than Rs. 50 lakhs. Accordingly, it is held that appeal filed by the revenue is not maintainable. We also hastened to add that certain times instances stated in para No. 10 of the CBDT Circular No. 3/2018 dated 11.07.2018 is not discernable from the assessment and appellate orders, therefore, in such cases, we also give liberty to revenue that if such instances comes to their notice than, revenue may file miscellaneous application with such evidences.

6. In the result, appeals filed by the department and the cross objection filed by the assessee are dismissed.

(Order pronounced in the open court on 20.08.2019)

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