ACIT - CIRCLE- 5(3)(2), MUMBAI vs. SUPERGEMS (INDIA) PVT.LTD., MUMBAI

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 P a g e | 2 to 5610/Mum/2018 & C.O. Nos.207 to 209 & 223/Mum/2019 A.Ys. 2010-11 to 2013-14 ACIT, Circle-5(3)(2) Vs. M/s Supergems (India) Pvt. ltd. 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 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.

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/-.

In the instant appeals filed by the Department, the tax effect involved in the captioned appeals is below the monetary limit of Rs.50,00,000/- in each case. The ld. Authorized Representative (for short „A.R‟) for the assessee, has filed a „chart‟ in order to fortify the aforesaid factual position, which reads as under:

Per contra, the ld. Departmental Representative (for short „D.R‟) submits that liberty may kindly be given to seek recall of the dismissal of appeals and their restoration, in case it can be shown that any of the said appeal was 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 captioned appeals filed by the revenue for A.Y(s) 2010-11 to 2013-14 are dismissed.

Resultantly, the captioned appeals of the revenue for A.Y. 2010-11 to A.Y. 2013-14, to 5610/Mum/2018, and also the C.O. Nos. 207 to 209/Mum/2019 & C.O No.223/Mum/2019 filed by the assessee, arising from the aforesaid appeals of the revenue are dismissed in terms of our aforesaid observations.