Facts of the Case

The Revenue filed multiple appeals before the Delhi High Court under Section 260A of the Income Tax Act, 1961 against the respondent, Sanjeev Dhingra. During the hearing, counsel for the Revenue submitted that the tax effect involved in each appeal was below ₹50 lakhs.

As per CBDT Circular No. 3/2018, appeals below the prescribed monetary threshold are not to be pursued by the Department. Based on this submission, the Revenue requested disposal of the appeals without adjudication on merits.

Issues Involved

  1. Whether appeals filed by the Revenue with tax effect below ₹50 lakhs are maintainable before the High Court.
  2. Whether such appeals can be disposed of without deciding the substantial question of law.

Petitioner’s Arguments (Revenue)

  • The Revenue acknowledged that the tax effect in each appeal was below ₹50 lakhs.
  • It relied upon CBDT Circular No. 3/2018, which restricts filing or continuation of appeals below the prescribed monetary limit.
  • Requested that the appeals be disposed of without adjudicating the legal issues, leaving questions of law open.

Respondent’s Arguments

  • The respondent did not appear (recorded as “Nemo”).
  • No arguments were advanced on behalf of the respondent.

Court’s Findings / Order

  • The Court recorded the statement made by the Revenue regarding the low tax effect.
  • It held that in view of CBDT Circular No. 3/2018, the appeals were not required to be adjudicated on merits.
  • Accordingly, the Court disposed of the appeals without deciding the questions of law, leaving them open for future consideration.

Important Clarification

  • The dismissal of appeals was not on merits but solely due to the low tax effect.
  • The Court explicitly clarified that questions of law remain open, meaning they may be raised in future cases where the monetary threshold is met.
  • This reinforces that CBDT circulars are binding on the Revenue authorities regarding litigation policy.

Link to download the order -https://delhihighcourt.nic.in/app/case_number_pdf/2018:DHC:8333-DB/SKN29082018ITA9442018_102437.pdf

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