As the Government has increased the threshold limit for tax departments to file appeals in tribunals and courts in July, the Central Board of Indirect Taxes and Customs ( CBIC ) has directed the officials to complete the process of withdrawal of cases by this month end.
The Board is dissatisfied by the “tardy progress” of withdrawal of departmental appeals.
As on October 15, 2767 indirect tax cases remain to be withdrawn in CESTAT (Customs, Excise and Service Tax Appellate Tribunal), high courts and the Supreme Court, CBIC data showed.
“Filing of a common miscellaneous application covering all identified cases in the HC and The CESTAT. This has already been suggested in letter dt 14.09.2018 . As you are aware a consolidated list of cases ripe for withdrawal from the Supreme Court has already been compiled and sent to the CAS for requisite drafting of interlocutory application/filing of single application on the advice of the Ld AG. The idea behind this, is to ensure that the withdrawal takes place in a single move to save valuable time. This should be adopted in HC and CESTAT as well,” a CBIC communication said.
“…the status of withdrawals as on October 15, 2018 was put up to the Chairman who has observed “progress is very tardy”. It has been directed that the entire activity (of filing or withdrawal of departmental appeals) be positively completed by October 30, 2018,” the judicial cell of CBIC has written to all principal chief commissioners and chief commissioners of the department.
The officials have been directed to file a common miscellaneous application covering all identified cases in the high courts and the CESTAT. The department has already prepared a list of cases “ripe for withdrawal” from the Supreme Court to ensure that the withdrawal takes place in a single move to save time, the missive said, adding that the same method should be adopted for high courts and CESTAT as well.
In July, the government had hiked the threshold for appeals filed by the tax department before the Income Tax Appellate Tribunal/Customs, Excise and Service Tax Appellate Tribunal (ITAT/CESTAT) to Rs 20 lakh from Rs 10 lakh earlier, for high courts to Rs 50 lakh from Rs 20 lakh and as for the Supreme Court to Rs 1 crore from Rs 25 lakh. At tribunal level, Central Board of Direct Taxes (CBDT) files appeals in ITAT (Income Tax Appellate Tribunal) while the CBIC files appeals in CESTAT (Customs, Excise and Service Tax Appellate Tribunal).
Following the decision to hike the monetary limits for tax appeals, the CBIC was estimated to see a reduction of 18 per cent in litigation. At the tribunal level, the department was estimated to withdraw 16 per cent of the cases while 22 per cent matters in high courts and 21 per cent of the appeals in the Supreme Court were not be litigated any further.
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