Low tax effect bars departmental appeal where disputed tax falls below the revised ITAT monetary limit.

CBDT Circular No. 17/2019 revised the monetary limit for departmental appeals before the ITAT to Rs. 50,00,000, enhancing the earlier threshold under Circular No. 3/2018. Where the disputed tax effect falls below the applicable limit, the appeal is not maintainable and cannot be entertained. On that basis, the departmental appeal was dismissed for low tax effect.

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Issues: Whether the departmental appeal was maintainable in view of the monetary limit prescribed for filing appeals before the Tribunal.

Analysis: The tax effect in the appeal was found to be below the revised monetary limit of Rs. 50,00,000 prescribed by CBDT Circular No. 17/2019 dated 08.08.2019, which enhanced the limit from the earlier Circular No. 3/2018. As the disputed tax effect did not exceed the applicable threshold, the appeal could not be entertained.

Conclusion: The appeal was not maintainable and was dismissed on account of low tax effect.

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