DCIT,CENTRAL CIRCLE-1(4), KOLKATA,KOLKATA vs. BINOD KUMAR MISHRA & OTHERS (HUF), KOLKATA

“3 . Henceforth, appeals/ SLPs shall not be filed in cases where the tax effect does not exceed the monetary limits given hereunder: Sl. No. Appeals/SLP’s in Income-tax matters Monetary Limit (in Rs) 1. Before Appellate Tribunal 20,00,000/- 2. Before High Court 50,00,000/- 3. Before Supreme Court 1,00,00,000/- , 228 & 229/KOL/2017 Assessment year: 2013-2014 Page 3 of 5 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.

On perusal of the Circular No. 3/2018 dated 11.07.2018 and the materials available on record, we do not see these cases falling under any of the exceptions contemplated in the said circular per se. We also find that this circular makes it very clear that the revised monetary limits shall apply retrospectively to pending appeals as well. Hon’ble apex court in Commissioner of Customs vs Indian Oil Corporation Ltd reported in 267 ITR 272 (SC) has settled the law that CBDT’s circulars are very much binding on revenue authorities. We thus hold that all these Revenue’s appeals deserve to be dismissed in terms of low tax effect. We make it clear that it shall be very much open for the Revenue to seek necessary rectification in case it is found that any of these appeals involve operations of exception clauses in the tax effect circular as per law.

In respect of these three appeals filed by the Revenue, the assessees have filed their Cross Objections being C.O. Nos. 28/KOL/2017 (in 33/KOL/2017 (in & 92/KOL/2017(in ITA No. 229/KOL/2017). The ld. D.R. has contended that these three Cross Objections filed by the assessees are liable to be dismissed in limine as a result of dismissal of the corresponding appeals of the Department because of low tax effect. In this regard, the ld. Counsel for the assessees has relied on the decision of Delhi Bench of this Tribunal in the case of ACIT –vs.- Ajay Kalia (2016) 66 Taxmann.com 99, wherein it was held that where the Cross Objection filed under section 253(4) is on an issue independent of the , 228 & 229/KOL/2017 Assessment year: 2013-2014 Page 4 of 5 appeal filed by the Revenue, then such Cross Objection cannot be dismissed simply on the ground of dismissal of the appeal by the Revenue involving low tax effect. He has contended that penalty under section 271AAB(1)(a) was imposed by the Assessing Officer on the total income, which included partly the income represented by cash and other assets found or seized during the course of search while the balance income represented income suo motu declared by the assessees, which was not represented by any asset found or seized during the course of search. He has submitted that when the said penalty imposed by the Assessing Officer was challenged by the assessees in the first appeal filed before the ld. CIT(Appeals), the ld. CIT(Appeals) vide his impugned orders has confirmed the penalty to the extent it was on the amount of undisclosed income represented by cash and other assets found or seized during the course of search while the penalty imposed in respect of the balance undisclosed income, which was suo motu declared by the assessees and which did not represent any asset found or seized during the course of search, was cancelled by him. He has contended that the issue involved in the Cross Objections filed by the assessees challenging the action of the ld. CIT(Appeals) to the extent of confirmation of penalty levied by the Assessing Officer under section 271AAB(1)(a) thus is different and the same can be decided independent of the corresponding appeal filed by the Revenue. We find merit in this contention of the ld. Counsel for the assessees and keeping in view the submissions made by the ld. Counsel for the assessees and respectfully following the decision of the Coordinate Bench of this Tribunal at Delhi in the case of ACIT –vs.- Ajay Kalia (supra), we hold that all the three Cross Objections filed by the assesses, which involve an issue, which can be decided independent of the appeals filed by the Revenue, are maintainable having independent existence. The Registry is accordingly directed to fix the said Cross Objections along with other group cases involving a similar issue for hearing and disposal.

In the result, all the three appeals of the Revenue are dismissed.