DEPUTY COMMISSIONER OF INCOME TAX, CHENNAI vs. KANDASAMY THANGARAJ, KARURU

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ITA 2350/CHNY/2024Status: DisposedITAT Chennai08 April 2025AY 2018-194 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the appeal filed by the Revenue is not maintainable. The reasoning was based on the submission made by the assessee's representative, which was not disputed by the Revenue's representative. The tax effect of the appeal was Rs.31,98,150/-, which is less than the monetary limit of Rs.60 lakhs for filing appeals before the Income Tax Appellate Tribunal, as revised by CBDT Circular No. 9/2024 dated 17.09.2024. Paragraph 5 of the circular clarifies that the modified limit applies to all pending cases. Therefore, the Tribunal found force in the submission that the appeal is not maintainable on the basis of low tax effect. The operative direction is the dismissal of the appeal.

What were the facts?

The appeal arises from an order of the Commissioner of Income Tax (Appeals) — 19, Chennai, dated 12/07/2024. The assessment for the year 2018-19 was framed by the DCIT, Central Circle-2, Trichy, under sections 153C, 144, and 263 of the Income Tax Act, 1961, vide an order dated 29.03.2023. The Revenue filed an appeal before the ITAT. The assessee's representative pointed out that the tax effect in the appeal, stated as Rs.31,98,150/- in the memo of appeal, was below the revised monetary limit of Rs.60 lakhs for filing appeals to the ITAT, as per CBDT Circular No. 9/2024 dated 17.09.2024. The Revenue's representative could not dispute this fact.

What were the issues?

1. Whether the appeal filed by the Revenue is maintainable before the Income Tax Appellate Tribunal, considering the tax effect and the monetary limits prescribed by CBDT Circular No. 9/2024, turning on Section 268A of the Income Tax Act, 1961. Assessee's Contention: The appeal is not maintainable because the tax effect of Rs.31,98,150/- is below the revised monetary limit of Rs.60 lakhs for filing appeals to the ITAT, as stipulated in CBDT Circular No. 9/2024 dated 17.09.2024. The assessee relies on this circular and prays for the dismissal of the appeal. Revenue's Contention: The Revenue relied on its grounds of appeal but could not dispute the fact that the tax effect was less than the amount specified in the circular.

Which sections of the Income-tax Act were involved?

Section 153C,Section 144,Section 263,Section 268A

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, ‘B’ BENCH, CHENNAI

Before: SHRI MANU KUMAR GIRI & SHRI JAGADISH

This appeal is arising out of the order of the Commissioner of Income tax (Appeals) – 19, Chennai [hereinafter referred to as the “CIT(A)”] in DIN and Order No: ITBA/APL/S/250/2024- 25/1066656282(1) dated 12/07/2024. The assessment was framed by the DCIT, Central Circle-2, Trichy (hereinafter referred to as “AO”) for the assessment year 2018-19 u/s. 153C r.w.s 144 r w s 263 of the Income tax Act, 1961 (hereinafter referred to as the “Act”), vide order dated 29.03.2023.

2. At the outset, the Ld AR invited the attention of the Bench to the column No: 10 of the Memo of appeal in Form No:36 filed by the Revenue, in which the tax effect was stated to be Rs.31,98,150/-. He further drew the attention of the Bench the circular of the Board bearing no:9/2024, dated 17-09-2024, wherein it was mentioned that the monetary limit fixed for filing appeal by the Revenue to the ITAT was revised to Rs.60 lakhs. He submitted that the revenue appeal is, therefore, not maintainable and prayed for its dismissal.

3. The Ld. DR, relied on grounds of appeal filed. However, he could not dispute the fact that the tax effect mentioned in Column No.10 of the memo of appeal filed was less than the amount specified in the circular referred to supra.

The text of the Circular No: 9 dated 17-09-2024 is reproduced hereunder:

F.No.279/Misc./M-74/2024-IT J Government of India Ministry of Finance Department of Revenue Central Board of Direct Taxes ******** Circular No. 09/2024 New Delhi, 17th September, 2024 Sub:- Further enhancement of Monetary limits for filing of appeals by the Department before Income Tax Appellate Tribunal, High Courts and SLPs/appeals before Supreme Court: amendment to Circular 5 of 2024- Measures for reducing litigation- Reg.

Reference is invited to Circular No 5/2024 (F.No.279/Misc.l42/2007- ITJ(Pt.)) dated 15.03.2024 of Central Board of Direct Taxes (the 'Board') vide which monetary limits for filing of income tax appeals by the Department before Income Tax Appellate Tribunal, High Courts and SLP/appeals before Supreme Court have been specified. Further, exceptions to the monetary limits were also specified vide paras 3.1 and 3.2 of the said Circular.

2.

As a step towards management of litigation, it has been decided by the Board to revise the monetary limits for filing of appeals in Income-tax cases as stated in Para 4.1 of the aforementioned Circular as follows:

Sl. No. Appeals/SLPs in Monetary Income-tax Limit (Tax matters effect in Rs.) 1. Before Income Tax 60lakh Appellate Tribunal 2. Before High Court 2 crore

3. Before Supreme 5 crore Court

3.

Monetary limits given in paragraph 2 above with regard to filing appeal/SLP shall be applicable to all cases including those relating to TDS/TCS under the Income-tax Act, 1961 with exceptions as per paras 3.1 and 3.2 of Circular No 5/2024 dated 15.03.2024, where the decision to appeal/file SLP shall be taken on merits, without regard to the tax effect and the monetary limits.

4.

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. The officers concerned shall keep in mind the overall objective of reducing unnecessary litigation and providing certainty to taxpayers on their Income-tax assessments while taking a decision regarding filing an appeal.

5.

The modifications shall come into effect from the date of issue of this Circular. This Circular will apply to SLPs/appeals to be filed henceforth in SC/HCs/Tribunal. It shall also apply to the SLPs/ appeals pending before Supreme Court/High Courts/Tribunal, which may accordingly be withdrawn. 6. The above may be brought to the notice of all concerned. 7. This issues under section 268A of the Income-tax Act, 1961.

4. It is pertinent to note that Para 5 of the circular clearly states that the modified limit would apply to all pending cases.

5. As the tax effect of the appeal filed is less than the monetary limit fixed for filing appeal by the revenue to the ITAT, we find force with the submission of the Ld AR that the appeal is not maintainable.

6.

In the result, the appeal filed by the Revenue, on the basis of low tax effect, as per the circular cited supra, is dismissed. Order pronounced in the open court on 8th April, 2025 Sd/- Sd/- (जगदीश ) ( मनु कुमार िग�र ) ( Jagadish ) ( Manu Kumar Giri) लेखा सद�य लेखा सद�य / Accountant Member �ाियक सद�/ Judicial Member लेखा लेखा सद�य सद�य चे�ई/Chennai,

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