Madras H.C : the Tribunal was right in dismissing the appeal filed by the Revenue without going into the merits of the case on the ground that the tax effect was less than the monetary limit of Rs. 1,00,000 prescribed by the CBDT in Instruction No. 1979, dt. 27th March, 2000, for filing appeals before the Tribunal without considering the subsequent Instruction No. 1985, dt.26th Sept., 2000, and without considering the judicial pronouncements of the various High Courts including that of the jurisdictional High Court wherein it has been held that the Board’s Instructions regarding monetary limits do not operate as an embargo on considering the appeals on the merits ?

High Court Of Madras

CIT vs. Excel Finance

Section : 253

Asst. Year 1993-94, 1994-95, 1995-96

K. Raviraja Pandian & P.P.S. Janarthana Raja, JJ.

Tax Case (Appeal) Nos. 663 to 665 of 2008

8th July, 2008

Counsel appeared :

T. Ravikumar, for the Appellant : None, for the Respondent

JUDGMENT

K. Raviraja Pandian, J. :

The Revenue aggrieved by the order of the Tribunal dt. 1st April, 2005, passed in ITA Nos. 1185, 1186 and 1187/Mad/2003 for the asst. yrs. 1993-94, 1994-95 and 1995-96 filed the present appeals by framing the following substantial question of law :

“Whether on the facts and in the circumstances of the case, the Tribunal was right in dismissing the appeal filed by the Revenue without going into the merits of the case on the ground that the tax effect was less than the monetary limit of Rs. 1,00,000 prescribed by the CBDT in Instruction No. 1979, dt. 27th March, 2000, for filing appeals before the Tribunal without considering the subsequent Instruction No. 1985, dt.26th Sept., 2000, and without considering the judicial pronouncements of the various High Courts including that of the jurisdictional High Court wherein it has been held that the Board’s Instructions regarding monetary limits do not operate as an embargo on considering the appeals on the merits ?”

The assessments of the assessee for the asst. yrs. 1993-94, 1994-95 and 1995-96 were completed by the AO making several additions including the difference in the closing balance of the deposits between the amount shown in the balance-sheet and the return of income and statements filed subsequently and addition towards interest in respect of M/s Sri Venkateswara Poultry Farm which was offered only partly by the assessee. Aggrieved by the additions, the assessee carried the matter on appeal before the CIT(A), who having satisfied, deleted the addition due to the difference between the balance-sheet figure and the figure given in the statement accompanying the return. As far as the interest not fully shown, the CIT(A) gave partial relief on the basis of the assessment of M/s Sri Venkatesvara Poultry Farm. Aggrieved by the orders of the CIT(A), the Revenue filed appeals before the Tribunal. The Tribunal accepted the contention of the assessee that the tax effect in the appeals for all the three years was below Rs. 1,00,000 and, therefore, as per the Board’s Circular dt. 27th March, 2000, no appeal was to be filed before the Tribunal by placing reliance of the decision of this Court in the case of reported in CWT vs. S. Annamalai (2003) 181 CTR (Mad) 450 : (2002) 258 ITR 675 (Mad) and dismissed the appeals in limine on the ground that the tax effect is less than Rs. 1,00,000 and it does not also fall within the exceptions provided for filing appeal before the Tribunal even where the tax effect is less than Rs. 1,00,000. The correctness of the said order is now canvassed before this Court by framing the above stated question of law.

Heard the learned counsel for the Revenue and perused the order of the Tribunal. An issue similar to the issue in this case came up for consideration before a Division Bench of this Court in the case of CWT vs. S. Annamalai (supra) wherein it was held that in order to reduce the litigation for filing Departmental appeals/references before the Tribunal, High Courts and the Supreme Court, the CBDT, by Circular No. F. No. 279/126/1998-IT, dt. 27th March, 2000, revised the monetary limits. However, the following should be contested irrespective of the Revenue effect : (i) where the Revenue audit objection in the case has been accepted by the Department, (ii) where the Board’s order notification, instruction or circular is the subject-matter of an adverse order, (iii) where prosecution proceedings are contemplated against the assessee, and (iv) where the constitutional validity of the provisions of the Act are under challenge.

5. The Revenue has not made out any case to show that the case falls within the four exceptions provided in the circular of the CBDT in F. No. 279/126/1998-IT, dt. 27th March, 2000. Hence, the appeals deserve to be dismissed as there is no question of law arising out of the order of the Tribunal. The Tribunal’s order requires no interference, for the foregoing reasons. The appeals are dismissed. No costs.

[Citation : 326 ITR 537]