Tax Effect based Revised Monetary Limits for filing of Appeal / SLP by Revenue : CBDT

CBDT’s Revised Tax Effect based Monetary Limits for Filing of Appeals / SLP by IT Deptt. before ITAT/ HC / SC

The CBDT has revised the minimum monetary limits for filing of appeals / SLP by the IT Department before the Income Tax Appellate Tribunal (ITAT) / High Courts (HC) & Supreme Court (SC) as a measure to reduce litigation.

In supersession of the instructions specified in CBDT’s instruction No 5/2014 dated 10.07.2014 wherein monetary limits and other conditions for filing departmental appeals (in Income-tax matters) before Appellate Tribunal and High Courts and SLP before the Supreme Court were specified, the Board has decided that-departmental appeals may be filed on merits before Appellate Tribunal and High Courts and SLP before the Supreme Court keeping in view the monetary limits and conditions specified below:

1. Before Appellate Tribunal 10,00,000/-

2. Before High Court 20,00,000/-

3. Before Supreme Court 25,00,000/-

Henceforth, appeals/ SLPs shall not be filed in cases where the tax effect does not exceed the aforesaid monetary limits.

It has further been clarified by the CBDT that an appeal should not be filed merely because the tax effect in a case exceeds the monetary limits prescribed above. Filing of appeal in such cases is to be decided on merits of the case.

For this purpose, “tax effect” means the difference between the tax on the total income assessed and the tax that would have been chargeable had such total income been reduced by the amount of income in respect of the issues against which appeal is intended to be filed (hereinafter referred to as “disputed issues”). However the tax will not include any interest thereon, except where chargeability of interest itself is in dispute. In case the chargeability of interest is the issue under dispute, the amount of interest shall be the tax effect. In cases where returned loss is reduced or assessed as income, the tax effect would include notional tax on disputed additions. In case of penalty orders, the tax effect will mean quantum of penalty deleted or reduced in the order to be appealed against.

Further, the AO shall calculate the tax effect separately for every assessment year in respect of the disputed issues in the case of every assessee.

CBDT Circular 21/2015 dt. 10 Dec. 2015

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