What did the Tribunal hold?

The Tribunal held that as per CBDT Circular No. 3 of 2018, appeals with a tax effect below Rs. 20 lacs should be dismissed or withdrawn. Therefore, the appeal was dismissed.

The Revenue filed an appeal before the ITAT against an order of the CIT(A). The tax effect in the appeal was less than Rs. 20 lacs.

What were the issues?

Whether the Revenue's appeal should be dismissed based on the monetary limit prescribed by CBDT Circular No. 3 of 2018 for pending appeals.

DCIT vs Khs Machinery Pvt.Ltd. | ITAT Ahmedabad 2019

Income Tax Appellate Tribunal, “D” BENCH, AHMEDABAD

Before: SHRI WASEEM AHMED&

For Appellant: Shri T. Shankar, Sr.D.R

For Respondent: Shri J. P. Shah, A.R

Pronounced: 14.02.2019

IN THE INCOME TAX APPELLATE TRIBUNAL “D” BENCH, AHMEDABAD BEFORE SHRI WASEEM AHMED, ACCOUNTANT MEMBER & Ms. MADHUMITA ROY, JUDICIAL MEMBER I.T.A. No.1749/Ahd/2014 (Assessment Year : 2005-06) The DCIT(OSD), Vs. KHS Machinery Pvt. Ltd., Cir – 4, 53, Madhuban, Ellisbridge, Ahmedabad, Navjivan Ahmedabad. Trust Building, Off. Ashram Road, Ahmedabad. [PAN No.AABCK 2513 Q] (Appellant) .. (Respondent)

Appellant by : Shri T. Shankar, Sr.D.R. Respondent by : Shri J. P. Shah, A.R. 11.02.2019 Date of Hearing Date of Pronouncement 14.02.2019 O R D E R PER Ms. MADHUMITA ROY - JM: The instant appeal filed by the Revenue is against the order dated 18.03.2014 passed by the Commissioner of Income Tax (Appeals)-XXI, Ahmedabad under section 143(3) of the Income Tax Act, 1961 arising out of the order dated 22.12.2008 for the Assessment Year 2005-06.

At the time of the hearing, we observe that the tax effect in the appeal filed by the Revenue is less than Rs. 20 lacs. As per the Circular No. 3 of 2018 dated 11/07/2018 issued by CBDT recently all pending appeals filed by Revenue are liable to be dismissed/ withdrawn/ not pressed to reduce the

ITA No.1749/Ahd/2014 KHS Machinery Pvt. Ltd. Asst.Year –2005-06 - 2 - litigation where the tax effect does not exceed the prescribed monetary limit, i.e., Rs.20 Lacs. The relevant extract of the circular is reproduced below: “2. In supersession of the above Circular, it has been decided by the Board that departmental appeals may be filed on merits before Income Tax Appellate Tribunal and High Courts and SLPs/ appeals before Supreme Court keeping in view the monetary limits and conditions specified below. 3. Henceforth, appeals/ SLPs shall not be filed in cases where the tax effect does not exceed the monetary limits given hereunder:

S. Appeals/ SLPs in Income-tax matters Monetary Limit No. (Rs.) 1. Before Appellate Tribunal 20,00,000 2. Before High Court 50,00,000 3. Before Supreme Court 1,00,00,000

The monetary limit for filing the appeals by the Revenue before the Tribunal has been increased to Rs. 20 Lacs. It is also clarified in the said Circular that the said monetary limit is applicable retrospectively even to the appeals pending before the Tribunal. The CBDT has also instructed that such pending appeals below this specified tax limit of Rs.20 lacs may be withdrawn / not pressed.

In the case on hand, it was noticed that the tax effect on the disputed issue raised by the Revenue is claimed to be less Rs.20 Lacs. Therefore appeal of the Revenue is required to be dismissed in limine in terms of the above circular.

The Ld. DR for the Revenue fairly agreed on the applicability of the CBDT Circular No. 3 of 2018. Accordingly, the appeal of the Revenue is dismissed as not maintainable. However, the Revenue is on the liberty to move the miscellaneous application to recall the order if the tax effect exceeds

ITA No.1749/Ahd/2014 KHS Machinery Pvt. Ltd. Asst.Year –2005-06 - 3 - the threshold limit or the case of the Revenue falls in any of the exception provided in the aforesaid CBDT Circular in any manner. The MA shall be filed within the prescribed time. Hence the appeal of the Revenue is dismissed.

In the result, the appeal filed by the department is dismissed. This Order pronounced in Open Court on 14/02/2019

Sd/- Sd/- ( WASEEM AHMED ) ( Ms. MADHUMITA ROY ) ACCOUNTANT MEMBER JUDICIAL MEMBER Ahmedabad; Dated 14/02/2019 Priti Yadav, Sr.PS आदेश क� ��त�ल�प अ�े�षत/Copy of the Order forwarded to : 1. अपीलाथ� / The Appellant 2. ��यथ� / The Respondent. 3. संबं�धत आयकर आयु�त / Concerned CIT 4. आयकर आयु�त(अपील) / The CIT(A)-XXI, Ahmedabad. 5. �वभागीय ��त�न�ध, आयकर अपील�य अ�धकरण, अहमदाबाद / DR, ITAT, Ahmedabad 6. गाड� फाईल / Guard file. आदेशानुसार/ BY ORDER, स�या�पत ��त //True Copy// उप/सहायक पंजीकार (Dy./Asstt.Registrar) आयकर अपील�य अ�धकरण, अहमदाबाद / ITAT, Ahmedabad

THE DCIT(OSD)-1, CIRCLE-4, AHMEDABAD vs. KHS MACHINERY PVT.LTD., AHMEDABAD

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