DCIT, CIRCLE-2, MIDNAPORE, PASCHIM MEDINIPUR vs. MANILAL THAKKAR & COMPANY, PASCHIM MEDINIPUR

ITA 1957/KOL/2014Status: DisposedITAT Kolkata21 August 2018AY 2008-20093 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that the appeal filed by the Revenue was not maintainable due to the revised monetary limits for filing appeals as per CBDT Circular No. 3/2018. The circular was also applicable retrospectively to pending appeals.

What were the facts?

The Revenue filed an appeal before the ITAT. The assessee did not appear for the hearing. The ITAT noted that the appeal was filed against an order where the disputed addition and tax effect were below the revised monetary limits prescribed by a recent CBDT circular.

What were the issues?

The primary issue was the maintainability of the Revenue's appeal before the ITAT in light of the revised monetary limits stipulated by the CBDT circular.

Which sections of the Income-tax Act were involved?

CBDT Circular No. 3/2018

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, “B” BENCH : KOLKATA

Before: Shri J. Sudhakar Reddy, AM & Shri S.S. Viswanethra Ravi, JM

Hearing: 19.07.2018Pronounced: 21.08.2018

The above appeal by the Revenue against the order of the Learned Commissioner of Income Tax(Appeals), XXXVI, Kolkata for the A.Y 2008-09.

None appeared on behalf of assesse.

3. On perusal of record, that the appeal filed by the revenue is not maintainable in view of latest CBDT Circular.

4. The CBDT has issued Circular No. 3/2018 dated 11.07.2018, whereby the monetary limits for filing of appeals by the Revenue Department before Income Tax Appellate Tribunal, High Courts and SLP before Supreme Court have been increased. The revised monetary limits laid down in para-3 of this Circular and the manner of computing tax effect as laid down in para-4 of this Circular are as follows:

“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/- 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.

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 the issues against which appeal is intended to be filed (hereinafter referred to as 'disputed issues’). Further, 'tax effect' shall be tax 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 orders, the tax effect will mean quantum of penalty deleted or reduced in the order to be appealed against.”

In para-13 of the said circular it has further been clarified that the revised monetary limits will apply retrospectively. The relevant para-13 of the Circular reads thus: “13. This Circular will apply to SLPs/appeals/cross objections/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.

4. In the present case, the disputed addition(s) and tax thereon are below Rs.20,00,000/-.

In view of the above, the appeal filed by the Revenue is dismissed as not maintainable in view of latest CBDT Circular No. 3/2018 dt. 11-07-2018.

In the result, the appeal of revenue is dismissed. Order pronounced in the Court on 21.08.2018

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