2018 (7) TMI 2182 - AT - Income Tax

CBDT Circular No. 3/2018: Tribunal Dismisses Appeals Below Tax Threshold

The Tribunal dismissed all Revenue appeals and cross objections of the assessee due to the tax effect being below Rs. 20 lakhs, as per CBDT Circular No. ... Maintainability of appeal on low tax effect - HELD THAT:- CBDT has issued circular No. 3/2018 dated 11th July, 2018 vide which it has been decided by the Board that the departmental appeals shall not be filed before the ITAT in cases where the tax effect does not exceed the monetary limit of ₹ 20 lacs. Also specified at para 13 of the CBDT circular No. 3/2018 that this circular shall apply retrospectively to pending appeals below the specified tax limit. We consider that the CBDT has issued the circular 3/2018 dated 11th July, 2018 envisaging therein that department ’s pending appeals before the Tribunal are to be withdrawn/not pressed as per the above stated circular, therefore, appeal of the revenue is required to be dismissed in l imine. The ld. D.R. has fairly admit ted that the applicability of the CBDT Circular no. 3 of 2018 dated 11th July, 2018. In the light of the above CBDT’s circular, we find that the appeals filed by the Revenue are not maintainable and cross object ions of the assessee on account of merely supporting the order of ld. CIT(A) are also dismissed as infructuous. Issues:- Maintainability of appeals before the ITAT based on tax effect below Rs. 20 lakhs as per CBDT Circular No. 3/2018 dated 11th July, 2018.Analysis:1. The judgment dealt with a bunch of appeals by the Revenue against orders of the CIT(A), where the tax effect individually was less than Rs. 20 lakhs due to relief granted by the CIT(A). The Tribunal noted the CBDT Instruction No. 3/2018 dated 11th July, 2018, which specified that departmental appeals not exceeding the monetary limit of Rs. 20 lakhs should not be filed before the ITAT. The CBDT circular applied retrospectively to pending appeals below the specified tax limit, requiring the dismissal of appeals falling within its ambit. The Revenue's appeals were found to be non-maintainable under this circular, leading to their dismissal.2. Considering the CBDT's circular, the Tribunal found the Revenue's appeals and the cross objections of the assessee, merely supporting the CIT(A) order, to be not maintainable. Consequently, all appeals by the Revenue and cross objections of the assessee were dismissed. However, the Revenue was allowed the option to seek restoration of its appeals if exceptions or other reasons warranted it.3. Ultimately, the Tribunal pronounced that all appeals by the Revenue and the respective Cross Objections of the assessee were dismissed. The order was delivered in Open Court on 31/07/2018. The judgment emphasized the strict adherence to the monetary limits set by the CBDT circular, leading to the dismissal of appeals falling below the specified threshold.