TaxTMI 
TaxTMI 
2013 (2) TMI 451
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....Board of Direct Taxes Instructions. Shri Kulkarni, the learned advocate appearing for the assessee in these tax appeals, has submitted before us that the Central Board of Direct Taxes Instructions, fixing the monetary limits for the Revenue to file appeals before the High Court have been issued in consonance with the provisions of section 268A(1) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). According to him, similar instructions had been issued by the Central Board of Direct Taxes at various points of time even prior to the insertion of section 268A(1) in the Act. He submitted that these Central Board of Direct Taxes Instructions have been interpreted by this court in various decisions and it has been held that they are applicable not only to new cases, which may be filed by the Revenue but also to the pending appeals. He submits, therefore, that since the tax effect in both these appeals is less than Rs. 10 lakhs, the appeals are not maintainable. The tax effect in Tax Appeal No. 76 of 2007 for the assessment year 1989-90 is Rs. 5,29,625 whereas the tax effect in Tax Appeal No. 78 of 2007 in respect of the assessment year 1988-89 is Rs. 2,28,040. He, ther....
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.... the Central Board of Direct Taxes. The earlier instructions of March 27, 2000, and June 29, 2000, were modified partially and the monetary limit was raised. Accordingly, appeals under section 260A to the High Court could be filed, if the tax effect was below Rs. 4 lakhs. The Board also decided that in cases where there was substantial question of law of importance and in cases where the same question of law would repeatedly arise, either in the case concerned or in similar cases, appeals should be filed on the merits, without being hindered by the monetary limits imposed by the instruction. This instruction came into effect from October 31, 2005.The Division Bench of this court in Tax Appeal No. 22 of 2004 decided on September 28, 2007, in the case of the CIT v. Chhajer Packaging and Plastics Pvt. Ltd. since reported in [2008] 300 ITR 180 (Bom), construed this circular, to mean that only such appeals, which were filed after the issuance of instruction No. 2 of 2005 would be governed by the Instruction.The court held that the Instruction would not be applicable to pending appeals. It was observed that the Department is not prohibited from filing and pursuing appeals, where....
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....te to a common issue. We beg to disagree on a plain and literal construction of the instruction. The expression "which involves more than one year"would have no meaning if it was restricted only to the expression "common issues". The expression, therefore, of a composite order will have to be read to mean an order in respect of the same assessee for more than one year. An (order) disposing of several appeals on a common question of law by the appellate authority, cannot be said to be a composite order as the order involves appeals by different persons, which appeals for the sake of convenience have been only clubbed together for the purpose of disposal on that issue. In our opinion, this would be the correct reading of para. 5 of the instruction." As stated earlier, the Income-tax Act was amended and section 268A has been introduced on the statute book with retrospective effect. Section 268A carves out an exception for filing of appeals and references under section 260A of the Act. The Legislature has prescribed that the Central Board of Direct Taxes is empowered to issue circulars and instructions from time to time, with regard to filing of appeals depending on the tax effect i....
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....Direct Taxes. One fails to understand how the Revenue, on the face of the above clear instructions of the Central Board of Direct Taxes, can contend that the circular dated May 15, 2008, issued by the Central Board of Direct Taxes is applicable to the cases filed after May 15, 2008, and in compliance thereof, they do not file appeals, if the tax effect is less than Rs. 4 lakhs ; but the said circular is not applicable to the cases filed prior to May 15, 2008, i.e., to the old pending appeals, even if the tax effect is less than Rs. 4 lakhs. In our view, there is no logic behind this belief entertained by the Revenue." The court has further held that the prevailing instructions fixing the mone-tary limit for the tax effect would hold good even for pending cases. Accordingly, the court dismissed all the appeals having a tax effect of less than Rs. 4 lakhs. The new Central Board of Direct Taxes instructions have been issued on February 9, 2011, being Instruction No. 3 of 2011. The monetary limit has been raised again and clause 3 of the instruction provides that appeals shall not be filed in cases where the tax effect does not exceed the monetary limits prescribed henceforth.....
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.... which appeal is intended to be filed. Having regard to the tax liability of the respondent-assessee, assessed originally, the instant appeal is within the coil of the monetary limits prescribed by the Central Board of Direct Taxes Circular. Section 268A was inserted in the Act, with effect from April 1, 1999, by the Finance Act, 2008. The Memorandum Explaining the Provi-sions of the Finance Bill, 2008, highlights the underlying objective of section 268A to reduce litigation in small cases and regulate the right of Revenue to file or not to file appeal. Section 260A demonstrates the condition precedent of preferring an appeal before this court to be the existence of a substantial question of law. Noticeably, it does not contemplate any monetary limit in addition. As has been stipulated in the Central Board of Direct Taxes Instruction No. 5 of 2008, dated May 15, 2008, para. 8 covers eventualities whereunder an appeal can be filed by the Revenue irrespective of the tax effect. These being where (a) the constitutional validity of the provisions of an Act or Rules is under challenge, (b) the Board's order, notification, instruction or circular has been held to be illegal or ....