Facts of the Case

  • The Revenue filed multiple appeals before the Delhi High Court against different assessees.
  • During the hearing, the counsel for the Revenue submitted that the tax effect in the appeals was below Rs. 50,00,000.
  • As per CBDT Circular No. 3/2018 dated 11.07.2018, appeals below the specified monetary limit are not to be pursued.
  • The Revenue requested that the appeals be disposed of without adjudicating the substantial questions of law, with liberty to revive if exceptions apply.

Issues Involved

  • Whether appeals involving tax effect below the prescribed monetary limit should be entertained by the High Court.
  • Whether substantial questions of law should be adjudicated despite low tax effect.
  • Whether liberty can be granted to revive such appeals if covered under exceptions to CBDT circular.

Petitioner’s (Revenue’s) Arguments

  • The tax effect in the present appeals is below Rs. 50,00,000.
  • In view of CBDT Circular No. 3/2018, such appeals are not required to be pursued.
  • The appeals may be disposed of without answering the substantial questions of law.
  • Liberty should be granted to revive the appeals if the cases fall within specified exceptions under the circular.

Respondent’s Arguments

  • No detailed arguments from respondents are recorded in the order.

Court’s Findings / Order

  • The Court recorded the submission of the Revenue regarding low tax effect.
  • The appeals were disposed of without examining or deciding the substantial questions of law.
  • The issues raised were expressly kept open.
  • Liberty was granted to the Revenue to seek revival of the appeals if the cases fall within exceptions under the CBDT Circular.
  • Pending applications were also disposed of.

Important Clarification by the Court

  • The dismissal of appeals is not on merits.
  • The substantial questions of law remain open and undecided.
  • The Revenue retains the right to revive the appeals if exceptions under the CBDT Circular apply.

Link to download the order -https://delhihighcourt.nic.in/app/case_number_pdf/2018:DHC:8339-DB/SKN12102018ITA11252018_104753.pdf

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