Commissioner Of Income Tax, Udaipur v. M/S P.i.industries, Udai Sagar Road, Udaipur

HIGH COURT OF JUDICATURE FOR RAJASTHAN ATJODHPUR D.B. Income Tax Appeal No. 104 / 2013 Commissioner of Income Tax, Udaipur ----Appellant Versus M/S P.I.Industries, Udai Sagar Road, Udaipur. ----Respondent Connected With D.B. Income Tax Appeal No. 18 / 2012 Commissioner of Income Tax, Udaipur ----Appellant Versus M/S P.I.Industries, Udai Sagar Road, Udaipur. ----Respondent _____________________________________________________ For Appellant(s) : Mr. KK Bissa For Respondent(s) : Mr. Anjay Kothari _____________________________________________________ HON'BLE MR. JUSTICE K. S. JHAVERI HON'BLE DR. JUSTICE PUSHPENDRA SINGH BHATI Judgment 23/01/2018 Instant appeals are directed against order of the Income TaxAppellate Tribunal and indisputably the tax effect as brought toour notice, is less than Rs.20 lac. A Circular No.21/2015 has been issued by the Central Boardof Direct Taxes dated 10.12.2015 in exercise of its power u/sec.268A (1) of the Income-tax Act 1961 in supersession of theBoards instruction No.5/2014 dt.10.7.2014 regularising themonetary limits for filing the appeals by the Revenue before the Tribunal, High Courts and Apex Court with an object for reducing litigation. Relevant para nos.3, 8, 9 and 10 reads ad infra :- “3.Henceforth, appeals/SLPs shall not be filed in cases wherethe tax effect does not exceed the monetary limits givenhereunder :- S.Appeals in Income-tax mattersMonetary Limit (in Rs.)No.1Before Appellate Tribunal10,00,000/-2Before High Court20,00,000/-3Before Supreme Court25,00,000/- It is clarified that an appeal should not be filed merely becausethe tax effect in a case exceeds the monetary limits prescribedabove. Filing of appeal in such cases is to be decided on merits ofthe case. 4.xxxxxxxxx5.xxxxxxxxx6.xxxxxxxxx7.xxxxxxxxx8.Adverse judgments relating to the following issues shouldbe contested on merits notwithstanding that the tax effectentailed is less than the monetary limits specified in para 3 aboveor there is no tax effect: (a) Where the Constitutional validity of the provisions of anAct or Rule are under challenge, or (b)Where Board's order, Notification, Instruction orCircular has been held to be illegal or ultra vires, or (c)Where Revenue Audit objection in the case has beenaccepted by the Department, or(d)Where the addition relates to undisclosed foreignassets/bank accounts. 9.The monetary limits specified in para 3 above shall notapply to writ matters and direct tax matters other than Incometax. Filing of appeals in other Direct tax matters shall continue tobe governed by relevant provisions of statute & rules. Further,filing of appeal in cases of Income Tax, where the tax effect is notquantifiable or not involved, such as the case of registration oftrusts or institutions under section 12 A of the IT Act, 1961, shallnot be governed by the limits specified in para 3 above anddecision to file appeal in such cases may be taken on merits of aparticular case. 10.This instruction will apply retrospectively to pendingappeals and appeals to be filed henceforth in HighCourts/Tribunals. Pending appeals below the specified tax limitsin para 3 above may be withdrawn/not pressed. Appeals beforethe Supreme Court will be governed by the instructions on thissubject, operative at the time when such appeal was filed.” The extract of the paragraphs referred to supra, clearlyindicates that the limits specified in para 3 may not apply tocertain exceptions specified in para 8, at the same time para nos.9and 10 of the Circular if read conjointly, clearly envisages that thepresent instructions will apply retrospectively to all the pendingappeals and appeals to be filed henceforth in HighCourts/Tribunals, subject to exceptions where the tax effect evenif is less than Rs.20 lac, can be preferred in High Courts. The extract of the paragraphs referred to supra, clearlyindicates that the limits specified in para 3 may not apply tocertain exceptions specified in para 8, at the same time para nos.9and 10 of the Circular if read conjointly, clearly envisages that thepresent instructions will apply retrospectively to all the pendingappeals and appeals to be filed henceforth in HighCourts/Tribunals, subject to exceptions where the tax effect evenif is less than Rs.20 lac, can be preferred in High Courts. Taking note of the CBDT Circular dt. 10/12/2015 and the taxeffect which indisputably in the instant case is less than Rs.20 lac,much less than what has been prescribed for filing appeal beforethe High Courts, deserves to be dismissed as not pressed.However, it is made clear that the substantial questions of lawraised in the instant appeals, if any, are left open to be examinedin an appropriate proceeding, if arises in future. At the same timewe consider it appropriate to observe that if the appeal falls in anyof the exceptions as referred to in the Circular dt. 10/12/2015, theRevenue will be at liberty to move an application for recalling ofthe order if so advised. Accordingly, in the light of the CBDT Circular dated10.12.2015 the appeals stand dismissed as not pressed. Let a copy of this order be placed in each file separately. (DR. PUSHPENDRA SINGH BHATI)J. (K. S. JHAVERI)J. S. Phophaliya-66-67