After the Central Government increased the monetary limit for tax appeals, the Supreme Court has dismissed hundreds of cases in which the tax effects were less than Rs 1 crore.
While dismissing a hundred of tax appeals by the department on 17th September, a two-judge bench comprising Justice Rohinton Fali Nariman and Justice Indu Malhotra
The CBDT circular fixed the threshold limit for filing an appeal in the Supreme Court at over Rs 1 crore and stated that pending appeals or special leave petitions (SLPs) should be withdrawn “on priority” to enable the department to focus on high-value litigation.
Recently, a bench headed by Justice AK Sikri relied upon the July circular by the Central Board of Direct Taxes (CBDT) to put an end to scores of tax cases.
Taking into account this circular, the bench decided to proactively cut down such appeals pending before the apex court. The court, by one such order recently, wrapped up more than 200 cases in one brush.
“The Registry has listed these matters on the ground that the tax effect is less than Rs 1 crore and, therefore, as per the Circular of the CBDT, these are not pressed by the Income Tax Department and are to be dismissed on the ground of low tax effect,” noted the bench.
“In these appeals, the tax effect is less than Rs 1 crore and are covered by the Circular of CBDT. These appeals are, accordingly, dismissed. However, it will be open to the Income-Tax Department to seek review in any of these matters, if it is pointed out that the tax effect is more than Rs 1 crore,” the bench said. Similar orders have been passed in hundreds of cases to give a quietus to the tax cases.
The court has further directed the registry to maintain a separate list of cases where the assessees have moved in appeals and also another list where although the tax effect is less than Rs 1 crore, the cases said to be not covered by the CBDT circular.
As the Government has raised the threshold limit for tax appeals to reduce litigation, the Boards have directed its officials to file a single application before the High Courts and the Tribunalsmalhotra to complete the process in a speedy manner.
The Board earlier directed the officials to complete all the works related to withdrawal of the appeal by 30th September 2018.
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