CBDT monetary limit for departmental appeals applied retrospectively, making the Revenue appeal not maintainable for low tax effect.

CBDT Circular No. 21 of 2015 fixed a monetary limit for departmental appeals, and it was applied to pending appeals with retrospective effect. Where the tax effect is below the prescribed threshold, the Department is directed not to press or to withdraw the appeal, and the matter is not examined on merits. In this instance, the Revenue could not show that the tax effect exceeded the limit, so the appeal fell within the circular and was treated as not maintainable.

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Issues: Whether the Revenue appeal was not maintainable in view of the CBDT circular prescribing a monetary limit for departmental appeals and its retrospective application to pending appeals.

Analysis: The tax effect involved in the appeal was below the prescribed monetary limit of Rs. 10,00,000 under CBDT Circular No. 21 of 2015 dated 10.12.2015. The circular was held applicable to pending appeals with retrospective effect, and the Department was directed to withdraw or not press appeals where the tax effect was below the threshold. As the Revenue could not show that the appeal crossed the limit, the appeal was treated as covered by the circular and was not examined on merits.

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

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