Monetary limit exceptions for revenue appeals must be applied narrowly; appeals below the threshold were not maintainable.

Revenue appeals below the prescribed monetary limit are not maintainable unless they fall strictly within a recognised exception, and such exceptions must be applied narrowly according to their stated scope. The exception in para 10(e) of Circular No. 3 of 2018 applies only where the addition is based on information from external law enforcement agencies such as CBI, ED, DRI, SFIO or DGGI; that condition was not met. Circular No. 23 of 2019 was confined to organised tax evasion cases involving bogus long-term or short-term capital gains on penny stocks, which was also not the nature of the additions. The appeals therefore did not satisfy any applicable exception to the monetary limit.

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Issues: Whether the revenue appeals were maintainable in view of the monetary limit circulars and the exception carved out for specified categories of cases.

Analysis: The tax effect in both appeals was below the prescribed monetary limit. The exception in para 10(e) of Circular No. 3 of 2018 applies only where the addition is based on information received from external law enforcement agencies such as CBI, ED, DRI, SFIO or DGGI. The case did not fall within that category. Circular No. 23 of 2019 was also held to be confined to cases involving organized tax evasion through bogus long-term or short-term capital gains on penny stocks, which was not the nature of the present additions. The appeals therefore did not satisfy any applicable exception to the monetary limit.

Conclusion: The revenue appeals were not maintainable and were liable to be dismissed.

Ratio Decidendi: An appeal filed by the revenue below the prescribed monetary limit is not maintainable unless it falls strictly within a specifically carved-out exception, and such exceptions are to be applied narrowly according to their expressed scope.

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