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Income Tax Appellate Tribunal, MUMBAI BENCH “B” MUMBAI
ORDER
PER RAVISH SOOD, JM
The present appeal filed by the revenue is directed against the order passed by the Commissioner of Income Tax (Appeals)-52, [for short „CIT(A)‟], Mumbai, dated 01.06.2018, which in turns arises from the assessment order passed by the A.O under section 143(3) r.w.s 153A of the Income Tax Act 1961, (for short „Act‟), dated 28.03.2016.
Central Board of Direct Taxes (CBDT) vide Circular No. 17/2019 dated 08.08.2019 has amended Circular No. 3/2018 dated 11.07.2018 for further enhancement of monetary limit for filing of appeals by the Department before the ITAT, High Courts and SLPs/Appeals before Supreme Court as measures for reducing litigation.
CBDT vide Circular No. 3/2018 dated 11.07.2018 has specified that appeals shall not be filed before the Income Tax Appellate Tribunal (ITAT) in cases where the tax effect does not exceed the monetary limit of Rs.20,00,000/-. For this purpose, „tax effect‟ means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of issues against which appeal is intended to be filed. Further, „tax effect‟ shall be taxes including applicable surcharge and cess. However, the tax will not include any interest thereon, except where chargeability of interest itself is in dispute. In case the 2 DCIT,CC-4(3), Mumbai Vs. Shri Nilesh M. Agarwal chargeability of interest is the issue under dispute, the amount of interest shall be the „tax effect‟. In cases where returned loss is reduced or assessed as income, the „tax effect‟ would include notional tax on disputed additions. In case of penalty order, the „tax effect‟ will mean quantum of penalty deleted or reduced in the order to be appealed against.
At para 13 of the above Circular, it has been mentioned that:
“13. This Circular will apply to SLPs/appeals/cross objection/references to be filed henceforth in SC/HCs/Tribunal and it shall also apply retrospectively to pending SLPs/appeals/cross objections/references. Pending appeals below the specified tax limits in para 3 above may be withdrawn/not pressed.”
As a step towards further management of litigation, CBDT vide Circular No. 17/2019 has fixed the monetary limit for filing of appeals before ITAT at Rs.50,00,000/-.
At the very outset, the ld. Departmental Representative (for short „D.R‟) had placed on record a letter dated 08.12.2020 of the DCIT, Central Circle-4(3), Mumbai, addressed to the CIT, DR- „B‟ Bench, Mumbai, wherein a working of the „tax effect‟ involved in the appeals filed by the revenue in the case of the assessee for A.Y.2010-11 to A.Y. 2014-15 was stated. Taking us through the said details, it was submitted by the ld. D.R that as the tax involved in the revenues appeal for A.Y. 2011-12 in i.e Rs.47,61,833/- was below the monetary limit of Rs.50 lac, as provided in the CBDT Circular No. 17/2019, dated 08.08.2019, the same, thus, was not maintainable.
Before us, the Ld. D.R submits that liberty may kindly be given to raise, after necessary further verification and to seek recall of the dismissal of appeal and its restoration, in case it can be shown that the appeal is covered by the exceptions.
We agree with the above contentions of the Ld. DR and make it clear that the appellant shall be at liberty to point out the exceptions and we will take appropriate remedial measures in this regard.
With the above observations the appeal involving a „tax effect‟ of less than Rs.50,00,000/- is dismissed. Order pronounced in the open Court on 04/02/2021.