The Commissioner Of Income Tax v. M/S Patwari Marbles Pvt. Ltd

HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH ATJAIPUR D.B. Income Tax Appeal No. 16 / 2007 The Commissioner Of Income Tax ----Appellant Versus M/S Patwari Marbles Pvt. Ltd ----Respondent _____________________________________________________ For Appellant(s) : Ms. Parinitoo Jain _____________________________________________________ HON'BLE MR. JUSTICE K.S. JHAVERI HON'BLE MR. JUSTICE VINIT KUMAR MATHURJudgment 18/01/2017 Instant appeal is directed against order of theIncome Tax Appellate Tribunal and indisputably the taxeffect as brought to our notice, is less than Rs.20 lac.A Circular No.21/2015 has been issued by theCentral Board of Direct Taxes dated 10.12.2015 inexercise of its power u/sec. 268A (1) of the Income-taxAct 1961 in supersession of the Boards instructionNo.5/2014 dt.10.7.2014 regularising the monetary limitsfor filing the appeal by the Revenue before theTribunal, High Courts and Apex Court with an object forreducing litigation. Relevant para nos.3, 8, 9 and 10reads ad infra :- “3.Henceforth, appeals/SLPs shall not be filed incases where the tax effect does not exceed the monetarylimits given hereunder :- S.Appeals in Income-taxMonetary Limit (inNo.mattersRs.)1Before Appellate Tribunal10,00,000/-2Before High Court20,00,000/- S.Appeals in Income-taxMonetary Limit (inNo.mattersRs.)3Before Supreme Court25,00,000/- It is clarified that an appeal should not be filedmerely because the tax effect in a case exceeds themonetary limits prescribed above. Filing of appeal insuch cases is to be decided on merits of the case. 8.Adverse judgments relating to the following issuesshould be contested on merits notwithstanding that thetax effect entailed is less than the monetary limitsspecified in para 3 above or there is no tax effect: (a) Where the Constitutional validity of theprovisions of an Act or Rule are under challenge, or(b)WhereBoard'sorder,Notification,Instruction or Circular has been held to be illegal orultra vires, or (c)Where Revenue Audit objection in the casehas been accepted by the Department, or(d)Where the addition relates to undisclosedforeign assets/bank accounts. 9.The monetary limits specified in para 3 aboveshall not apply to writ matters and direct tax mattersother than Income tax. Filing of appeals in otherDirect tax matters shall continue to be governed byrelevant provisions of statute & rules. Further,filing of appeal in cases of Income Tax, where the taxeffect is not quantifiable or not involved, such as thecase of registration of trusts or institutions undersection 12 A of the IT Act, 1961, shall not be governedby the limits specified in para 3 above and decision tofile appeal in such cases may be taken on merits of aparticular case. 10.This instruction will apply retrospectively topending appeals and appeals to be filed henceforth inHigh Courts/Tribunals. Pending appeals below thespecified tax limits in para 3 above may bewithdrawn/not pressed. Appeals before the SupremeCourt will be governed by the instructions on thissubject, operative at the time when such appeal wasfiled.” The extract of the paragraphs referred to supra,clearly indicates that the limits specified in para 3may not apply to certain exceptions specified in para 8,at the same time para nos.9 and 10 of the Circular ifread conjointly, clearly envisages that the presentinstructions will apply retrospectively to all thepending appeals and appeals to be filed henceforth in High Courts/Tribunals, subject to exceptions where thetax effect even if is less than Rs.20 lac, can bepreferred in High Courts. The extract of the paragraphs referred to supra,clearly indicates that the limits specified in para 3may not apply to certain exceptions specified in para 8,at the same time para nos.9 and 10 of the Circular ifread conjointly, clearly envisages that the presentinstructions will apply retrospectively to all thepending appeals and appeals to be filed henceforth in High Courts/Tribunals, subject to exceptions where thetax effect even if is less than Rs.20 lac, can bepreferred in High Courts. Taking note of the CBDT Circular dt. 10/12/2015 andthe tax effect which indisputably in the instant case isless than Rs.20 lac, much less than what has beenprescribed for filing appeals before the High Courts,deserves to be dismissed as not pressed. However, it ismade clear that the substantial questions of law raisedin the instant appeal, if any, are left open to beexamined in an appropriate proceeding, if arises infuture. At the same time we consider it appropriate toobserve that if the appeal falls in any of theexceptions as referred to in the Circular dt.10/12/2015, the Revenue will be at liberty to move anapplication for recalling of the order if so advised. Accordingly, in the light of the CBDT Circulardated 10.12.2015 the appeal stands dismissed as notpressed. (VINIT KUMAR MATHUR)J. (K.S. JHAVERI)J. /bm gandhi 91