ACIT Vs Madras Cricket Club (ITAT Chennai)
In ACIT vs. Madras Cricket Club, the Income Tax Appellate Tribunal (ITAT) in Chennai dismissed the Revenue’s appeal regarding the addition of Rs. 1.91 crore as entrance fees in the club’s income for the assessment year 2009-10. The appeal, initially delayed by 175 days, was condoned based on the Revenue’s request and explanations for the delay. However, the appeal was ultimately dismissed due to the tax effect involved being less than the threshold of Rs. 60 lakh, as per the Central Board of Direct Taxes (CBDT) Circular No. 09 of 2024. This circular, dated 17th September 2024, stipulates that appeals involving tax amounts below Rs. 60 lakh should not be pursued before the ITAT, except in specific exceptional cases.
The ITAT upheld the CBDT circular’s guidelines, finding the Revenue’s appeal unmaintainable as the tax effect was reported to be Rs. 57.4 lakh. The tribunal clarified that this dismissal does not preclude the Revenue from reopening the issue in future proceedings if warranted and stated that if any exception in the circular applies, the Revenue may seek to recall the order. Consequently, the ITAT dismissed the appeal, citing adherence to the CBDT’s guidelines on limiting litigation for cases involving lower tax impacts.
