What did the Tribunal hold?

The Tribunal accepted the Revenue's request to withdraw the appeal. The appeal was dismissed as withdrawn due to the low tax effect, as per CBDT circulars.

The Revenue filed an appeal before the ITAT against an order of the CIT(A). The tax effect involved in the appeal was below the monetary limit prescribed by the CBDT for filing appeals.

What were the issues?

Whether the appeal filed by the Revenue should be withdrawn based on the monetary limits prescribed by CBDT circulars for tax effect.

ITO vs M/S Excellent Engineering and… | ITAT Mumbai 2019

Income Tax Appellate Tribunal, MUMBAI BENCH “E” MUMBAI

For Respondent: Mr. Amit Pratap Singh, D.R

Hearing: 14/10/2019Pronounced: 14/10/2019

ORDER

PER RAVISH SOOD, JM

The captioned appeal filed by the revenue is directed against the order passed by the Commissioner of Income Tax (Appeals)-24, Mumbai [in short „CIT(A)‟], which in turns arises from the respective assessment order passed under section 143(3) of the Income Tax Act 1961, (the „Act‟).

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 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/-.

In the instant appeal filed by the Department, the tax effect involved is below the monetary limit of Rs.50,00,000/-. The same was brought to the notice of the Ld. Departmental Representative (DR).

Before us, the Ld. DR has filed a letter dated 01.10.2019 of the Income-tax Officer-15(1)(2), Mumbai, wherein withdrawal of the captioned appeal has been sought, for the reason, that the tax effect therein involved is below that provided in CBDT Circular No. 03/2018, dated 11.07.2018.

We accept the aforesaid request of the revenue and allow the withdrawal of the present appeal.

ITO WARD 15 (1)(2), MUMBAI vs. M/S EXCELLENT ENGINEERING AND ALLIED SERVICES PVT LTD., MUMBAI

What did the Tribunal hold?

What were the facts?

What were the issues?

Which sections of the Income-tax Act were involved?

Recent GST High Court judgments