D.b. Income Tax Appeal v. M/S.jewels Emporium

IN THE HIGH COURT OF JUDICATURE FOR RAJASTHANAT JAIPUR BENCH JAIPUR D.B. Income Tax Appeal No.49/2015 Commissioner of Income Tax-I Vs. M/s.Jewels Emporium Date of Order ::: 10.05.2016 HON'BLE MR. JUSTICE M.N. BHANDARIHON'BLE MR. JUSTICE J.K. RANKA Mr. Anuroop SinghiMr. O.P. Pareek, for the appellant(s). Instant appeal is directed against orderof the Income Tax Appellate Tribunal andindisputably the tax effect as brought to ournotice, is less than Rs.20 lac. A Circular No.21/2015 has been issued bythe Central Board of Direct Taxes dated10.12.2015 in exercise of its power u/sec.268A (1) of the Income-tax Act 1961 insupersession of the Boards instructionNo.5/2014 dt.10.7.2014 regularising themonetary limits for filing the appeals by theRevenue before the Tribunal, High Courts andApex Court with an object for reducinglitigation. Relevant para nos.3, 8, 9 and 10reads ad infra :- “3. Henceforth, appeals/SLPs shallnot be filed in cases where the taxeffect does not exceed the monetarylimits given hereunder :- S.Appeals in Income-Monetary LimitNo.tax matters(in Rs.)BeforeAppellate10,00,000/-1Tribunal2Before High Court20,00,000/-3Before Supreme Court25,00,000/- It is clarified that an appeal shouldnot be filed merely because the taxeffect in a case exceeds the monetarylimits prescribed above. Filing ofappeal in such cases is to be decidedon merits of the case. 4.xxxxxxxxx5.xxxxxxxxx6.xxxxxxxxx7.xxxxxxxxx 8.Adverse judgments relating to thefollowing issues should be contestedon merits notwithstanding that thetax effect entailed is less than themonetary limits specified in para 3above or there is no tax effect: (a) Where the Constitutionalvalidity of the provisions of an Actor Rule are under challenge, or (b) WhereBoard'sorder,Notification, Instruction or Circularhas been held to be illegal or ultravires, or (c) Where Revenue Audit objectionin the case has been accepted by theDepartment, or (d) Where the addition relates toundisclosedforeignassets/bankaccounts. 9.The monetary limits specified inpara 3 above shall not apply to writmatters and direct tax matters otherthan Income tax. Filing of appealsin other Direct tax matters shallcontinue to be governed by relevantprovisions of statute & rules.Further, filing of appeal in cases ofIncome Tax, where the tax effect isnot quantifiable or not involved,such as the case of registration oftrusts or institutions under section12 A of the IT Act, 1961, shall not be governed by the limits specifiedin para 3 above and decision to fileappeal in such cases may be taken onmerits of a particular case. 10. This instruction will applyretrospectively to pending appealsand appeals to be filed henceforth inHigh Courts/Tribunals. Pendingappeals below the specified taxlimits in para 3 above may bewithdrawn/not pressed. Appealsbefore the Supreme Court will begoverned by the instructions on thissubject, operative at the time whensuch appeal was filed.” The extract of the paragraphs referred tosupra, clearly indicates that the limitsspecified in para 3 may not apply to certainexceptions specified in para 8, at the sametime para nos.9 and 10 of the Circular ifread conjointly, clearly envisages that thepresentinstructionswillapplyretrospectively to all the pending appealsand appeals to be filed henceforth in HighCourts/Tribunals, subject to exceptionswhere the tax effect even if is less thanRs.20 lac, can be preferred in High Courts. Taking note of the CBDT Circular dt.10/12/2015 and the tax effect whichindisputably in the instant case is less thanRs.20 lac, much less than what has beenprescribed for filing appeal before the High The extract of the paragraphs referred tosupra, clearly indicates that the limitsspecified in para 3 may not apply to certainexceptions specified in para 8, at the sametime para nos.9 and 10 of the Circular ifread conjointly, clearly envisages that thepresentinstructionswillapplyretrospectively to all the pending appealsand appeals to be filed henceforth in HighCourts/Tribunals, subject to exceptionswhere the tax effect even if is less thanRs.20 lac, can be preferred in High Courts. Taking note of the CBDT Circular dt.10/12/2015 and the tax effect whichindisputably in the instant case is less thanRs.20 lac, much less than what has beenprescribed for filing appeal before the High Courts, deserves to be dismissed as notpressed. However, it is made clear that thesubstantial questions of law raised in theinstant appeals, if any, are left open to beexamined in an appropriate proceeding, ifarises in future. At the same time weconsider it appropriate to observe that ifthe appeal falls in any of the exceptions asreferred to in the Circular dt. 10/12/2015,the Revenue will be at liberty to move anapplication for recalling of the order if soadvised. Accordingly, in the light of the CBDTCircular dated 10.12.2015 the appeal standdismissed as not pressed. (J.K. RANKA),J (M.N.BHANDARI),J sunita/20 All corrections made in the judgment/order have been incorporated in thejudgment/order being e-mailed. Sunita KanwarJr.P.A.