A petition has been filed before the Supreme Court challenging the Government’s action increasing the threshold limit for filing departmental appeals at various appellate authorities, such as ITAT / CESTAT, the High Courts or the Supreme Court.
A few days before, the Government, in order to reduce the long pending grievances of taxpayers and to minimise Tax Litigations and to facilitate the Ease of Doing Business, has decided to increase the threshold monetary limits for filing Departmental Appeals at various levels. In connection with this, a circular has been issued by the Central Board of Direct Taxes. The Central Board of Indirect Taxes & Customs, (CBIC) has also issued an instruction vide which the monetary limit has been increased.
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Advocate Ashish Gopal Garg had moved the writ petition challenging the said circular and instructions by the respective boards.
He sought quashing of the circular issued on July 11 which also proposes to withdraw the cases filed by Union of India prior to July 11 and are pending before any of the forums.
It is to be noted that the Centre has increased the threshold monetary limit for tax department to file the appeal before ITAT/CESTAT from earlier Rs 10 lakh to Rs 20 lakh. The threshold monetary limit in case of high courts has been revised up to Rs 50 lakh, from Rs 20 lakh. For the Supreme Court, the newly revised limit is Rs 1 crore compared to Rs 25 lakh earlier.
According to the petitioner, the “drastic and exorbitant increase (manifold times) in the threshold monetary limit for filing appeals before the ITAT / CESTAT, high courts and the Supreme Court. For filing appeal before Supreme Court, threshold monetary limit has been increased from Rs 25 lakh to Rs 1 crore (four times).”
He also said by withdrawing the pending cases on the ground of revised monetary limit, the circulars have been made effective with retrospective effect and the authorities have also thereby done away with their liability to recover the legally recoverable amount which is due and payable by the defaulting assesses prior to the date of issue of the Circular and Instruction dated 11.07.2018.
He said that in 2015 also, the monetary limit was revised and there has been no substantial change in the economic condition of the country which necessitated further revision by way of the latest circular.
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