CIT, FARIDABAD vs. KARAM VIR VASHISTH HUF

Facts

The Revenue, as the appellant, sought to withdraw its appeal before the High Court. The withdrawal was based on a Circular issued by the Ministry of Finance, Department of Revenue, Central Board of Direct Taxes (CBDT) bearing No. 9/2024 dated 17.09.2024. This circular revised the monetary limits for filing appeals by the department before the Income Tax Appellate Tribunal (ITAT), High Court, and Supreme Court. The revised monetary limit for appeals before the High Court was set at Rs. 2 crore. The present appeal, filed by the Revenue, was stated to not fall within the exception clause of Circular No. 5/2024, which deals with cases where appeals are to be decided on merits regardless of tax effect. The Revenue's counsel therefore prayed for withdrawal of the appeal.

Held

The High Court allowed the prayer for withdrawal of the appeal. The Court noted that the monetary limits for filing appeals by the department before the ITAT, High Court, and Supreme Court have been enhanced by Circular No. 9/2024 dated 17.09.2024. The court observed that these modifications came into effect from the date of issuance of the circular and apply to appeals to be filed before the High Court. Since the present appeal was stated to not fall within the exception clause of Circular No. 5/2024, the court permitted the withdrawal of the appeal. The operative direction was to allow the prayer for withdrawal, and consequently, the appeal was dismissed as withdrawn. All pending applications were also disposed of.

Key Issues

1. Whether the present appeal, filed by the Revenue, should be allowed to be withdrawn in light of the revised monetary limits stipulated in CBDT Circular No. 9/2024 dated 17.09.2024? (Question of law/mixed law and fact, concerning the application of administrative circulars and litigation management policies). Assessee's Contention: Not recorded. Revenue's Contention: The Revenue contended that the appeal should be withdrawn as the monetary limit for filing appeals before the High Court has been enhanced to Rs. 2 crore by Circular No. 9/2024. They argued that the present case does not fall within the exception clause of Circular No. 5/2024, which mandates deciding cases on merits irrespective of tax effect. Therefore, the appeal, being below the enhanced monetary threshold, should be permitted to be withdrawn.