This case analysis explores the Income Tax Appellate Tribunal’s decision in ITA No. 5260/DEL/2019 concerning a transfer pricing adjustment dispute between DCIT Circle-11(1), New Delhi, and Halcrow Consulting India Pvt. Ltd. for the assessment year 2014-15.
The Revenue’s appeal contested the order of the CIT(Appeals)-44, New Delhi, which had granted relief to Halcrow Consulting India Pvt. Ltd. regarding a transfer pricing adjustment. The primary focus was whether the tax effect of the dispute warranted continuation of the proceedings.
The appeal was heard by Shri G.S. Pannu, Hon’ble President, and Shri Challa Nagendra Prasad, Judicial Member. At the outset, the tribunal noted that the tax effect involved was below the monetary threshold set by the CBDT for pursuing appeals, which had been revised to Rs. 50 lakhs. Consequently, the department’s appeal was considered not maintainable, leading to its dismissal based on the CBDT Circulars that mandate not filing or pursuing appeals with tax effects below the specified limits.
This decision underlines the importance of administrative circulars in managing litigation by setting clear monetary thresholds for the pursuit of appeals. It also reflects the tribunal’s commitment to reducing frivolous litigation and ensuring judicial economy by adhering to the guidelines set forth by the CBDT. The dismissal of the appeal in this case reaffirms the procedural thresholds that need to be considered before proceeding with tax-related disputes in higher judicial forums.
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