What did the Tribunal hold?

The Tribunal held that the CBDT's circular regarding monetary limits for appeals is binding on the tax authorities. Therefore, the Revenue should have withdrawn or not pressed the appeal.

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

What were the issues?

Whether the Revenue's appeal is maintainable before the Tribunal given that the tax effect is below the prescribed monetary limit set by the CBDT.

DCIT vs M/S. Houston Technologies Ltd… | ITAT Delhi 2017

Income Tax Appellate Tribunal, DELHI BENCH ‘C ’, NEW DELHI

Before: SHRI H.S. SIDHU & SHRI L.P. SAHU

ORDER

PER H.S. SIDHU, JM

The Department has filed this Appeal which is emanate from the Order dated 30.10.2014 of Ld. CIT(A)-XV, New Delhi pertaining to assessment year 2011-12. The grounds raised

in the revenue’s appeal reads as under:-

1. Whether on facts & circumstances of the case and in law, the ld. CIT(A) erred in holding the assessment u/s. 147 as bad in law.

2. Whether on facts and circumstances of the case and in law, the Ld. CIT(A) erred in deleting the addition of Rs. 18,59,213/- made on account of non- payment of services tax u/s 43B.

3. The appellant craves leave, to add, alter or amend any ground of appeal raised above at the time of the hearing.

2. During the hearing, Ld. DR relied upon the order of the AO.

3. On the contrary, Ld. Counsel of the assessee stated that the tax involved in this case is below the prescribed limit fixed by the CBDT, hence, the appeal may be dismissed on this account.

4. We have heard both the parties and perused the records. After perusing the records, we find that tax effect in the Revenue’s appeal is below the limit of Rs. 10 lacs, as fixed by the CBDT and, therefore, the Department’s Appeal is not maintainable, in view of the Circular No. 21/2015 dated 10th December, 2015 issued vide F.No. 279/Misc. 142/2007-ITJ (Pt.) by the CBDT. For the sake of convenience, the relevant para nos. 3 & 10 of the aforesaid CBDT’s Circular are reproduced as under:- “3. Henceforth, appeals/ SLPs shall not be filed in cases where the tax effect does not exceed the monetary limits given hereunder: Monetary Limit (in S No Appeals in Income-tax matters 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.

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 filed.” 5. It is not in dispute that the Board’s instruction or directions issued to the income- tax authorities are binding on those authorities, therefore, the Department should have withdrawn/ not pressed the present Appeal, in view of the aforesaid instructions since the tax effect in the instant Appeal is less than the amount of Rs. 10 lacs, prescribed in the above said CBDT’s Instructions. Keeping in view the CBDT Instruction No. 21/2015 dated 10th December, 2015, 6. we are of the view that the Revenue should have withdrawn/ not pressed the instant appeal before the Tribunal. We are also of the view that the said Instructions are applicable for the pending appeals and appeals to be filed henceforth in Tribunal. Accordingly, the Revenue’s Appeal is dismissed.

In the result, the Revenue’s Appeal stands dismissed. Order pronounced in the Open Court on 11/10/2017.

DCIT, NEW DELHI vs. M/S. HOUSTON TECHNOLOGIES LTD., NEW DELHI

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