CBDT monetary limit bars low-tax-effect departmental appeals before the ITAT where no exception applies.

CBDT monetary limits governed the maintainability of departmental appeals before the ITAT, and appeals with tax effect below the prescribed threshold were not to be filed. The dispute concerned a factual question on whether the assessee had interest-free loans exceeding interest-free advances, but no issue with a cascading effect in later years arose. As the tax effect in each appeal was below the then-applicable Rs. 3,00,000 limit and the Revenue's claimed exception was inapplicable on the facts, the appeals were held not maintainable and dismissed.

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Issues: Whether the departmental appeals were maintainable in view of the CBDT monetary limits where the tax effect in each appeal was below the prescribed threshold.

Analysis: The appeals related only to the factual question whether the assessee had interest-free loans exceeding interest-free advances, and no issue having cascading effect in subsequent years arose. The relevant CBDT Instruction No. 3/2011 prescribed a monetary limit of Rs. 3,00,000 for appeals before the Appellate Tribunal and directed that appeals shall not be filed where the tax effect does not exceed that limit. The tax effect in each of the present appeals was below Rs. 3,00,000, and the exception relied upon by the Revenue was held inapplicable on the facts.

Conclusion: The appeals were not maintainable and were dismissed.

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