Chhattisgarh HC Disposes of Income Tax Appeal as Tax Effect Falls Below Revised ₹2 Cr Threshold [Read Order]

The HC closed the matter in light of Circular No. 5/2024 dated 17.09.2024, which raised the monetary limits for filing appeals in income-tax cases. The case, registered as TAXC No. 49 of 2022, pertained to a tax liability amounting to less than ₹2 crores, which is now the benchmark threshold for departmental appeals to High Courts.

The appellant, Deputy Commissioner of Income Tax Raipur, had filed the appeal challenging the Income Tax Appellate Tribunal's ruling in favour of the respondent-assessee, M/s Sanjay Agrawal. However, when the matter was taken up for hearing on June 20, 2025, the appellant's counsel, informed the Bench of the new CBDT policy directive.

Step by Step Guidance for Tax Audit & E-filing, Click Here

As per the latest CBDT Circular, the monetary thresholds for departmental appeals have been substantially revised with the intent to streamline litigation and reduce unnecessary caseloads. For appeals to the ITAT, the limit now stands at ₹60 lakhs, while for High Courts and the Supreme Court, it has been raised to ₹2 crores and ₹5 crores respectively.

The Bench found the submission fair and reasonable, and proceeded to quote relevant portions of the September 2024 circular. Importantly, the Court highlighted paragraph 5 of the circular, which explicitly states that the revised monetary thresholds are to be applied not only to future appeals but also to those currently pending before various judicial forums, including High Courts.

The Court further acknowledged the broader purpose of the circular, which is to discourage indiscriminate appeals, reduce litigation backlog, and bring greater certainty for taxpayers.

Get a Complete Kit of Essential Books for Daily Practice, Click Here

The order stated that as per the submission of learned counsel for the appellant where the monetary limit (tax liability) in the present case is less than ₹2 Crores, the instant Tax Case stands disposed of

The instructions in the circular clarify that the appeal should not be filed merely on the basis of quantum. Instead, decisions must be made based on merit and relevance, particularly with the intent to avoid routine, mechanical filing. It also notes that exceptions outlined in paras 3.1 and 3.2 of the March 2024 circular would still govern cases involving substantial questions of law or revenue impact beyond numerical thresholds.

The matter between the Deputy Commissioner of Income Tax and M/s Sanjay Agrawal now stands closed, marking yet another case where fiscal prudence has prevailed over procedure.

Support our journalism by subscribing to Taxscanpremium. Follow us on Telegram for quick updates