Low tax effect bar on Revenue appeal applied, leading to dismissal subject to CBDT circular exceptions.

Revenue appeals are not maintainable where the tax effect falls below the CBDT-prescribed monetary limit, unless a recognised exception applies. Here, the tax effect in the appeal was below the limit fixed under CBDT Circular No. 17/2019, so the ITAT treated the appeal as barred by the low tax effect rule and dismissed it. Liberty was reserved to seek revival if the matter is later shown to fall within an exception under the CBDT circular dated 20.08.2018.

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Issues: Whether the Revenue's appeal was liable to be dismissed on the ground that the tax effect was below the monetary limit prescribed by the CBDT circular.

Analysis: The tax effect involved in the appeal was Rs. 35,25,971, which was below the monetary limit of Rs. 50 lakhs prescribed for filing appeals before the Tribunal under CBDT Circular No. 17/2019 dated 08.08.2019. The appeal was therefore covered by the circular barring such low tax effect appeals. Liberty was reserved to seek revival if the matter was later found to fall within an exception clause of the CBDT circular dated 20.08.2018.

Conclusion: The Revenue's appeal was dismissed as not maintainable in view of the low tax effect.

Ratio Decidendi: An appeal by the Revenue is not to be entertained where the tax effect is below the monetary limit prescribed by the applicable CBDT circular, unless it falls within a recognised exception.

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