TaxTMI 
TaxTMI 
2019 (4) TMI 1167
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....wo-judge Bench of the hon'ble Supreme Court in the case of Gemini Distilleries (supra) came to be explained by a later decision of the hon'ble Supreme Court in the case of DIT v. S. R. M. B. Dairy Farming (P.) Ltd. reported in [2018] 400 ITR 9 (SC) decided on November 23, 2017 about the retrospective application of the Central Board of Direct Taxes Circulars with regard to monetary limits for maintaining the pending appeals before the hon'ble High Court under section 260A of the Income-tax Act. The hon'ble Supreme Court in S. R. M. B. Dairy Farming (P.) Ltd. (supra) held as under (headnote of 400 ITR 9) : "Appeal to High Court-Monetary limits for litigation by Department-Circular to apply to pending appeals-But Circular not to be applied by court ipso facto when matter has cascading effect or where common principles involved in large number of matters-Income-tax Act, 1961, sections 260A, 268A-Instruction No. 3 of 2011, dated February 9, 2011 ([2011] 332 ITR (St.) 1 )." "The view adopted by the Delhi High Court making the circular applicable to pending matters came up before a three-judges Bench of this court in S. L. P. No. CC 13694 of 2011 titled ....
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....gation policy philosophy behind applying the circular and the benefit being extended in view thereof to all assessees where appeals have been pending, but below the financial limit, as otherwise an anomalous situation would arise. We may also take note of the judgment of this court in Suchitra Components Ltd. v. CCE [2007] 208 ELT 321 (SC) on the general principle of application of circulars. Reliance was placed on the view expressed in CCE v. Mysore Electricals Industries Ltd. [2006] 204 ELT 517 (SC) ; [2007] 8 RC 1 opining that a beneficial circular has to be applied retrospectively while an oppressive circular has to be applied prospectively. We are of the view that the mater needs to be put to rest and a clarity be obtained in view of the impact of this issue on pending cases before the High Courts as well as the cases which have been disposed of by various High Courts by applying Circular of 2011 to pending litigations. In our view the matter has been squarely put to rest taking further care of the interest of the Revenue by the order passed by the three-judge Bench of this court in Surya Herbal Ltd. case (supra), which had put two caveats even to the retrosp....
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....ling of appeal in such cases is to be decided on the merits of the case. 4. For this purpose, 'tax effect' means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of the issues against which appeal is intended to be filed (hereinafter referred to as 'disputed issues'). Further, 'tax effect' shall be tax including applicable surcharge and cess. However, the tax will not include any interest thereon, except where chargeability of interest itself is in dispute. In case the chargeability of interest is the issue under dispute, the amount of interest shall be the tax effect. In cases where returned loss is reduced or assessed as income, the tax effect would include notional tax on disputed additions. In case of penalty orders, the tax effect will mean quantum of penalty deleted or reduced in the order to be appealed against. 5. The Assessing Officer shall calculate the tax effect separately for every assessment year in respect of the disputed issues in the case of every assessee. If, in the case of an assessee, the disputed....
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.... only on account of the tax effect being less than the monetary limit specified above, the Principal Commissioner of Income-tax/ Commissioner of Income-tax shall specifically record that 'even though the decision is not acceptable, appeal is not being filed only on the consideration that the tax effect is less than the monetary limit specified in this circular'. Further, in such cases, there will be no presumption that the Income-tax Department has acquiesced in the decision on the disputed issues. The Income-tax Department shall not be precluded from filing an appeal against the disputed issues in the case of the same assessee for any other assessment year, or in the case of any other assessee for the same or any other assessment year, if the tax effect exceeds the specified monetary limits. 8. In the past, a number of instances have come to the notice of the Board, whereby an assessee has claimed relief from the Tribunal or the court only on the ground that the Department has implicitly accepted the decision of the Tribunal or court in the case of the asses see for any other assessment year or in the case of any other assessee for the same or any other assessment....
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....d by the limits specified in para 3 above and decision to file appeals in such cases may be taken on merits of a particular case. 12. It is clarified that the monetary limit of Rs. 20 lakhs for filing appeals before the Income-tax Appellate Tribunal would apply equally to cross-objections under section 253(4) of the Act. Cross-objections below this monetary limit, already filed, should be pursued for dismissal as withdrawn/not pressed. Filing of cross-objections below the monetary limit may not be considered henceforth. Similarly, references to the High Courts and special leave petitions/ appeals before the Supreme Court below the monetary limit of Rs. 50 lakhs and Rs. 1 crore respectively should be pursued for dismissal as withdrawn/not pressed. References before the High Court and the special leave petitions/appeals below these limits may not be considered henceforth. 13. This circular will apply to special leave petitions/appeals/cross-objections/references to be filed henceforth in Supreme Court/High Courts/Tribunal and it shall also apply retrospectively to pending special leave petitions/appeals/cross-objections/references. Pending appeals below the....