C I T vs. M/S SUPRIYA PHARMACEUTICALS LT

PDF · subscribers
ITA/148/2004HC RajasthanRJHC02031850200413 January 20164 pages
AI SummaryDismissed

What did the High Court hold?

The High Court held that no purpose would be served in continuing the present appeal, taking note of the CBDT Circular dated 10.12.2015 and the tax effect in the appeal, which was much less than the prescribed limit for filing appeals before the High Courts. The court clarified that the substantial questions of law admitted or sought to be raised were left open to be considered in an appropriate case. Accordingly, the appeal was dismissed in light of the CBDT Circular. The ratio decidendi is that appeals with a tax effect below the revised monetary limits stipulated by the CBDT Circular, and which are pending, should be withdrawn or not pressed, and the High Court will not entertain such appeals merely on merits if they fall below the threshold, unless they are writ matters or other specific exceptions mentioned in the circular.

What were the facts?

The appeal was filed by the Commissioner of Income Tax against an order dated 1.4.2004 of the Income Tax Appellate Tribunal. The adjustment made by the Assessing Officer was to the tune of Rs.1,58,076/-, which was significantly below Rs.20 lac. The matter had been pending since 2004, and service on the respondent assessee had not been effected. A Circular dated 10.12.2015 issued by the Central Board of Direct Taxes (CBDT) under Section 268A(1) of the Income-tax Act, 1961, revised monetary limits for filing appeals to reduce litigation. The circular stipulated that appeals shall not be filed if the tax effect does not exceed Rs.20,00,000/- before the High Court. This instruction was to apply retrospectively to pending appeals.

What were the issues?

1. Whether the appeal is maintainable before the High Court given the revised monetary limits prescribed by the CBDT Circular dated 10.12.2015, considering the tax effect in the present appeal is Rs.1,58,076/-. Assessee's Contention: The assessee did not appear or file any submissions. The judgment does not record any arguments from the assessee's side. Revenue's Contention: The revenue, through its counsel, brought to the court's notice the CBDT Circular dated 10.12.2015, which revised the monetary limits for filing appeals. The revenue implicitly sought to withdraw or not press the appeal based on this circular, as the tax effect was below the prescribed limit for High Court appeals.

Which sections of the Income-tax Act were involved?

Section 268A(1),Section 12A

AI-generated summary — verify with the full judgment below

1 IN THE HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR D.B. Income Tax Appeal No.148/2004 Commissioner of Income Tax v. M/s. Supriya Phamaceuticals Ltd. Date of order 13.1.2016 Hon'ble Mr. Justice Ajay Rastogi Hon'ble Mr. Justice J.K. Ranka Mr. R.B. Mathur with Mr. Nikhil Simlote, counsel for appellant By the Court

1.

This appeal has been preferred against order dated 1.4.2004 of the Income Tax Appellate Tribunal.

2.

As per the order of Assessing Officer, adjustment of the claim of assessee has been made to the tune of Rs.1,58,076/- i.e. much below Rs.20 lac. The matter is pending since 2004 and still service on the respondent assessee has not been effected so far.

3.

It is brought to our notice that a Circular has been issued by the Central Board of Direct Taxes dated 10.12.2015 in exercise of its power u/sec. 268A (1) of the Income-tax Act 1961 laying down revision of monetary limits for filing of appeals by the Department before the Tribunal and High Courts and SLP before Supreme Court keeping in view the measures for reducing litigation. Para 3

2 of the Circular reads as under :- “3. Henceforth, appeals/SLPs shall not be filed in cases where the tax effect does not exceed the monetary limits given hereunder :- S. No. Appeals in Income-tax matters Monetary Limit (in Rs.) 1 Before Appellate Tribunal 10,00,000/- 2 Before High Court 20,00,000/- 3 Before Supreme Court 25,00,000/- It is clarified that an appeal should not be filed merely because the tax effect in a case exceeds the monetary limits prescribed above. Filing of appeal in such cases is to be decided on merits of the case. 4. xxx xxx xxx 5. xxx xxx xxx 6. xxx xxx xxx 7. xxx xxx xxx 8. xxx xxx xxx

9.

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 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 para 3 above and decision to file appeal in such cases may be taken on merits of a particular case.

10.

This instruction will apply retrospectively to pending appeals and appeals to be filed henceforth in High Courts/Tribunals. Pending appeals below the specified tax limits in para 3 above may be withdrawn/not pressed. Appeals before the Supreme Court will be governed by the instructions on this subject, operative at the time when such appeal was 3 filed.” And laying down other conditions as well which has to be considered by the Assessing Officer or Appellate Authority as well the CBDT in paras 9 and 10 of the Circular it has been observed that the monetary limits specified in para 3 above shall not apply to writ matters and direct tax matters, and at the same time these instructions will apply retrospectively to the pending appeals and appeals to be filed henceforth in High Courts/Tribunals, and also before the Supreme Court.

4.

Taking note of the aforesaid Circular and the tax effect in the instant appeal which is much less than what has been prescribed for filing appeal before the High Courts, no purpose would be served to continue the present appeal any further. However, we make it clear that the substantial questions of law admitted/sought to be raised are left open to be considered in an appropriate case.

5.

Accordingly, in the light of the CBDT Circular dated 10.12.2015 the appeal is dismissed. (J.K. Ranka) J. (Ajay Rastogi) J. db 144

4 [All corrections made in the judgment/order have been incorporated in the judgment/order being emailed.] Deepankar Bhattacharya PS

More judgments on Section 268A(1)

All 190 judgments and leading authorities on Section 268A(1) →

Recent GST High Court judgments

Search GST case law →