TaxTMI 
TaxTMI 
2009 (7) TMI 145
X X X X Extracts X X X X
X X X X Extracts X X X X
....can be filed notwithstanding the fact that total cumulative tax effect involved in the appeal is less than Rs. 4 lakhs. According to him, such an appeal shall not be governed by the Central Board of Direct Taxes ("the CBDT" for short) Circular/Income-tax Instruction No. 5 of 2008, dated May 15, 2008. Since all these appeals were filed prior to the date of issuance of the said circular, they need to be heard and decided on the merits. 2. The issue raised needs consideration. It cannot be disputed that the Central Board of Direct Taxes Circular dated May 15, 2008, has no retrospective effect. It operates from the date of its issuance. As a corollary thereof, the appeals which come on board for consideration after the issuance of the Centra....
X X X X Extracts X X X X
X X X X Extracts X X X X
....f the year(s) in which 'tax effect' exceeds the monetary limit prescribed." (emphasis supplied) 4. The aforesaid paragraph (5) makes it clear that no appeals should be filed in the cases involving tax effect less than Rs. 4 lakhs notwithstanding the issue being of recurring nature. 5. The aforesaid paragraph (5) was a subject-matter of the judicial interpretation in the case of CIT v. Polycott Corporation in Income-tax Appeal No. 1241 of 2008 decided on January 23, 2009, (since reported in [2009] 318 ITR 144 (Bom) wherein this court ruled as under (page 146) : "It would be clear from the above that if in the case of an assessee if the disputed issues arise in more than one assessment year, appeals are to be filed only in respect of....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rcular 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. 8. This court can very well take judicial notice of the fact that by passage of time money value has gone down, the cost of litigation expenses has gone up, filing of cases at the instance of Revenue has increased; consequently, the burden on the Department has also increased to a tremendous extent. The corridors of the superior courts are choked with huge pendency of cases. The litigation expenses have also increased manifold. In this view of the matter, the Board has rightly taken decision not to file appeals i....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... department to withdraw cases wherein the tax effect is less than the prescribed monetary limits. 12. At this juncture, it will also be relevant to mention that it was necessary for the Central Board of Direct Taxes to put a caveat, while issuing instructions vide its Circular dated June 5, 2007, that the appeals involving substantial question of law of recurring nature should not be withdrawn since provision like section 268A of the Income-tax Act was absent. Now, in view of the insertion of the provision of section 268A by the Finance Act, 2008, with effect from April 1, 1999, in the Income-tax Act, 1961, no prejudice could be caused to the Revenue even if the cases involving legal issues of recurring nature are withdrawn, since the ne....