CBDT acquisition circular applied to pending departmental appeals where property value was below the prescribed limit.

CBDT Circular No. 455 dated 16.05.1986 was applied to pending departmental appeals under Chapter XX-A of the Income-tax Act, because the earlier Division Bench view treated the circular as covering appeals already pending before the Department. The circular directed that acquisition proceedings should not be initiated, and pending proceedings should be dropped, where the apparent consideration of the property was Rs. 5 lakhs or less. As the apparent value of the properties in all the appeals was undisputedly below that limit, the court applied the circular and dismissed the departmental appeals.

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Issues: Whether the departmental appeals against orders of the Income-tax Appellate Tribunal were liable to be dismissed by applying CBDT Circular No. 455 dated 16.05.1986, where the apparent consideration of the properties sought to be acquired was less than Rs. 5 lakhs.

Analysis: The proceedings arose under Chapter XX-A of the Income-tax Act, 1961, and the court noted the amendment by which Chapter XX-A was deleted and Chapter XX-C was introduced. It relied on the earlier Division Bench view that Circular No. 455, which directed that acquisition proceedings should not be initiated, and pending proceedings should be dropped, where the apparent consideration was Rs. 5 lakhs or less, applied to appeals already pending before the Department. As the apparent value of the properties in all the appeals was undisputedly below Rs. 5 lakhs, the court applied that circular and the binding precedent governing similar pending departmental appeals.

Conclusion: The circular applied to the pending appeals, and the departmental appeals were dismissed.

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