Govt. raises threshold limits for filing Departmental Appeals before Tribunals/ HC/ SC

Govt. raises threshold monetary limits for filing Departmental Appeals before Appellate Tribunals (ITAT/ CESTAT)/ HC/ SC: Major Steps taken for Reducing Tax Litigations

To reduce litigation, facilitate ease of doing business and to remove long pending grievances of taxpayers in the matters of direct/ indirect taxes, the Govt. has decided to raise threshold monetary limits for filing Departmental Appeals before the Appellate Tribunals (ITAT/ CESTAT), High Courts and Supreme Court, as under:

GOI Press Release dt. 11 July 2017

In order to reduce the long pending grievances of taxpayers and to minimise litigations pertaining to tax matters and to facilitate the Ease of Doing Business, Government of India has decided to increase the threshold monetary limits for filing Departmental Appeals at various levels, be it Appellate Tribunals, High Courts and the Supreme Court in the following manner :- 

Sl. No.Appeal ForaPresent limit for filing appeal (Rs.)Enhanced limit (Rs.)
1.ITAT / CESTAT10 lakhs20 lakhs
2.High Courts20 lakhs50 lakhs
3.Supreme Court25 lakhs1 Crore

This is a major step in the direction of litigation management of both direct and indirect taxes as it will effectively reduce minor litigations and help the Department to focus on high value litigations.

In case of CBDT, out of total cases filed by the Department in ITAT, 34% of cases will be withdrawn. In case of High Courts, 48% of cases will be withdrawn and in case of Supreme Court 54% of cases will be withdrawn. The total percentage of reduction of litigation from Department’s side will get reduced by 41%. However, this will not apply in such cases where substantial point of law is involved.

Similarly, in case of CBIC, out of total cases filed by the Department in CESTAT, 16% of cases will be withdrawn. In case of High Courts, 22% of cases will be withdrawn and in case of Supreme Court 21% of cases will be withdrawn. The total percentage of reduction of litigation from Department’s side will get reduced by 18%. However, this will not apply in such cases where substantial point of law is involved.

This step will also reduce future litigation flow from the Department side.

Accordingly, the CBDT and CBIC have issued the requisite instructions as under:

CBIC Instructions dt. 11 July 2017

CBDT Circular No. 3/2018 dt. 11 July 2018

Past Circulars on Threshold Monetary Limit for Filing Departmental Appeals before Tribunals/ HC/ SC

CBDT Clarification on Circular 21/2015 dt. 10 Dec. 2015 reg. Revision of Monetary Limits for filing of Cross Objections before the ITAT and References to the High Courts: CBDT Clarification on Circular 21/2015 dt 8th March 2016

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