Case Law Details
ITO Vs Hotchand Kalachand Loungani (ITAT Guwahati)
In a recent development, the Income Tax Appellate Tribunal (ITAT) Guwahati dismissed an appeal by the revenue in the case of ITO vs Hotchand Kalachand Loungani. The dismissal was based on the tax effect being less than the prescribed monetary limit by the Central Board of Direct Taxes (CBDT) for filing an appeal. This order was passed even though the ld. DR argued that the case falls under exception clause 10 of the CBDT Circular No.17 of 2019.
The ITAT Guwahati was explicit in its order that the tax effect involved in the appeal did not exceed the CBDT’s prescribed limit. This was in spite of the ld. DR’s insistence that the appeal fell under exception clause 10, which allows for challenges against constitutional validity or cases where Board’s order, notification, instruction, or circular has been deemed illegal or ultra vires. The ITAT pointed out that no such issues were present in the appeal filed by the assessee.
This decision of the ITAT Guwahati indicates a clear enforcement of the monetary limit set by the CBDT for filing appeals. It sends a strong message about adhering to this limit, barring cases where exceptional conditions, as set out in Circular No.17 of 2019, are applicable.
Conclusion: The ITAT Guwahati’s dismissal of the revenue appeal in the case of ITO vs Hotchand Kalachand Loungani underscores the importance of the prescribed monetary limit for tax appeals. This decision has implications for future tax-related appeals and underscores the importance of abiding by the tax effect limit set by the CBDT. Exceptions can only be made if the legal prerequisites are met, as outlined in the exception clauses of the relevant CBDT circular.
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