Tax Tribunal Dismisses Department Appeals Under Monetary Limit; Emphasizes Merits Over Amount

The Tribunal dismissed the appeals filed by the department as the tax effect in each appeal was less than Rs. 10,00,000, falling below the monetary limit set by Circular No. 21/2015 and Section 268A of the Income Tax Act, 1961. The CBDT circular clarified that appeals should not be filed solely based on exceeding monetary limits but should be based on the merits of the case. The Tribunal's decision was in line with the circular and statutory provisions, leading to the dismissal of the department's appeals.

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Issues:
Appeals filed by the department with tax effect less than Rs. 10,00,000 - Applicability of Circular No. 21/2015 and Section 268A of the Income Tax Act, 1961.

Analysis:
The appeals were against separate orders of the ld. CIT(A)- XXVIII, New Delhi, and the tax effect in each appeal was less than Rs. 10,00,000. The counsel for the assessee pointed out the Circular No. 21/2015 issued by the CBDT and Section 268A of the Income Tax Act, 1961, which provide monetary limits for not filing appeals before the Tribunal. The CBDT circular revised the monetary limit to Rs. 10,00,000 for not filing appeals before the Tribunal. The circular clarified that appeals should not be filed solely based on exceeding the monetary limits, and the decision should be based on the merits of the case.

Considering the submissions and the legal provisions, it was noted that Section 268A was inserted with retrospective effect and authorized the Board to issue instructions fixing monetary limits for filing appeals. The CBDT Circular No. 21 of 2015 set the monetary limit at Rs. 10,00,000 for appeals before the Tribunal. The circular applied to pending appeals as well, directing the department to withdraw or not press appeals where the tax effect is less than Rs. 10,00,000. The Tribunal, in line with the circular and statutory provisions, concluded that the Revenue should not have filed the instant appeal before the Tribunal.

Thus, without delving into the merits of the case, the Tribunal dismissed the appeals filed by the department. The instruction from the CBDT applied retrospectively to pending appeals, and the decision was made in accordance with the Circular No. 21/2015 and Section 268A of the Income Tax Act, 1961. The appeals of the department were consequently dismissed.

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