ACIT, CIRCLE-7(1) vs. SAK INDUSTRIES LTD.,

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ITA 2718/DEL/2005Status: DisposedITAT Delhi22 December 2015AY 2002-20032 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 CBDT circular is binding on the tax authorities and that the appeal filed by the Department was not maintainable due to the tax effect being below the prescribed monetary limit.

What were the facts?

The Department filed an appeal before the ITAT. The assessee pointed out that the tax effect in the case was below Rs. 10 lakhs, and the CBDT circular dated 10.12.2015 stipulated that appeals would not be filed if the tax effect was below this limit.

What were the issues?

Whether the Department's appeal is maintainable before the ITAT when the tax effect is below the monetary limit prescribed by the CBDT circular.

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI BENCH “G”: NEW DELHI

Before: SHRI N.K.SAINI & SHRI VIJAY PAL RAO

For Appellant: Smt. Amrapalli Das, CIT DR
For Respondent: CA Smt.Shaily Gupta & Sambhav Jain, CA
Hearing: 22.12.2015Pronounced: 22.12.2015

PER VIJAY PAL RAO, JM

1.

This is an appeal filed by the Department is directed against the order dated 28.03.2005 of ld. CIT(A)-X, New Delhi for the Assessment Year 2002-03.

2.

At the outset of the hearing itself, the ld. AR brought to our attention that CBDT vide Circular No.21/2015 dated 10th December, 2015 has decided that the revenue would not prefer an appeal before the Tribunal if the tax effect is less than Rs.10 lakhs. He has also filed the computation to show that the tax effect in this case is below Rs.10 lakhs. Therefore, he pleaded that the appeal of the revenue be dismissed as per the instruction of the CBDT. 3. Ld. DR was fair enough to admit the aforesaid factual position. 4. We have heard both the sides on the issue and perused the material. We find that the CBDT vide circular dated 10.12.2015 has revised the monetary limit for filing the appeal by the department before Income Tax Appellate Tribunal, Hon’ble High Courts and Hon’ble Supreme Court. The relevant para of the aforesaid circular is reproduced as under :-

Page No. 2 “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 in Income-tax matters Monetary Limit(in 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.”

5.

We find that the tax effect of the dispute involved in the revenue appeal is below Rs.10 lakhs. There is no dispute that the Board’s instructions 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 instruction sicne the tax effect in the instant appeal is less than the amount of Rs.10 lakhs. 5.1 In view of the above, Circular No.21 dated 10.12.2015 will apply to all pending appeals. Therefore, the appeal is not maintainable in the instant case as the tax effect is less than Rs.10 lakhs. Accordingly, it is held that appeal filed by the revenue is not maintainable.

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