ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE 1(1), RAIPUR vs. M/S TRICO SERVICES PVT. LTD., , RAIPUR

The present appeal filed by the revenue is directed against the order passed by the CIT(A)-II, Raipur, dated 13.08.2020, which in turn arises from the order passed by the A.O. u/s 143(3) of the Income-tax Act, 1961 (for short ‘Act’), dated 30.12.2016 for A.Y. 2014-15.

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 3 The ACIT-1(1), Raipur Vs. M/s. Tripco Services Pvt. Ltd., 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.

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/-. Our attention was drawn by the Ld. DR to a letter dated 30.11.2022 filed by the ACIT, Circle-1(1), Raipur. It was submitted by the Ld. DR that as the tax effect involved in the present appeal was below the monetary limit prescribed by CBDT Circular No.17/2019, dated 08.08.2019 for filing of appeals before the Tribunal, therefore, as instructed, the same may be permitted to be withdrawn.

Considering the aforesaid factual position, we herein permit the withdrawal of the present appeal.

Resultantly, the appeal filed by the revenue is dismissed as withdrawn.