Low tax effect appeals barred by CBDT circular where no recognised exception applies, despite earlier Supreme Court guidance.

Revenue appeals below the tax effect threshold prescribed by the applicable CBDT circular are not maintainable unless a recognised exception applies. The Court considered earlier Supreme Court authorities on the operation of the circular and exceptions such as cascading effect and group matters, but found no exceptional feature on the facts. The monetary limit therefore governed the appeal, and the Revenue's reference to possible review in appropriate cases did not affect the immediate bar on proceeding with the appeal.

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Issues: Whether the revenue appeal was liable to be dismissed on the ground that the tax effect was below the monetary limit prescribed by the applicable CBDT circular, and whether any exception was attracted.

Analysis: The appeal arose from an assessment year where the tax effect was below the prescribed ceiling. The Court examined the reliance placed on earlier Supreme Court orders and decisions dealing with the operation of the CBDT circular and the stated exceptions, including cases involving cascading effect or group matters. On the facts, the dispute did not involve any such exceptional feature, and the principle governing low tax effect appeals applied. The Court also noted that the Revenue's liberty to seek review in appropriate cases did not alter the immediate effect of the monetary limit.

Conclusion: The appeal was not maintainable in view of the monetary limit and was dismissed in favour of the assessee.

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