Revision of Monetary limit for filing Departmental appeals in income tax matters

Central Board of Direct Taxes via a circular dated January 10th, 2015, as a measure for reducing litigation has revised the monetary limits for filing departmental appeals (in income tax matters). These Instructions will apply retrospectively to pending appeals and appeals to be filed in High Courts/Tribunals. It has been decided by the Board that the departmental appeals may be filed before Appellate Tribunal and High Courts and SLP before Supreme Court keeping in view the monetary limits as mentioned below:

S. No. Appeals in Income Tax matters Monetary Limit
1. Before Appellate Tribunal 10,00,000/-
2. Before High Court 20,00,000/-
3. Before Supreme Court 25,00,000/-

The Board also clarified that the appeal shall not be filed merely because the tax effect in a case exceeds the monetary limits. Filing of appeal in such cases shall be decided on merits of the case.

  • The Assessing Officer shall calculate the tax effect separately for every assessment year in respect of the disputed issues in the case of every assesse.
  • In cases where appeal before Tribunal or Court is not filed only on account of tax effect being less than the monetary limit, there will be no presumption that the Income Tax Department has acquiesced in the decision on disputed issues. The Income Tax Department shall not be precluded from filing an appeal against disputed issues in the case of same assesse for any other assessment year.
  • The new monetary limits will not apply to writs matters and direct tax matters other than Income Tax.
  • Adverse judgments relating to the issues mentioned below should be contested on merits notwithstanding that the tax effect is less than the monetary limits
  • Where the Constitutional validity of the provisions of an Act or Rule are under challenge.
  • Where Board’s order, Notification, Instruction or Circular has been held to be illegal or ultra vires,
  • Where Revenue Audit objection in the case has been accepted by the Department,
  • Where the addition relates to undisclosed foreign assets/ bank accounts.

                -Ministry of Finance,

Department of Revenue, Central Board of Direct Taxes

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