Case Number: ITA 1151/DEL/2020
Appellant: Income Tax Officer (ITO) Ward – 1, Sonipat
Respondent: Brij Pal Tyagi, Sonipat
Assessment Year: 2011-12
Result: Appeal dismissed
Case Filed On: 2020-05-26
Order Type: Final Tribunal Order
Date of Order: 2022-11-02
Pronounced On: 2022-11-02
This case involves the Income Tax Officer (ITO) Ward – 1, Sonipat appealing against the order passed by the Commissioner of Income Tax (Appeals) [CIT(A)], Rohtak, in favor of Brij Pal Tyagi, Sonipat, for the assessment year 2011-12. The appeal was heard and dismissed by the Income Tax Appellate Tribunal (ITAT) due to the tax effect being less than Rs. 50 lakhs, as per the Central Board of Direct Taxes (CBDT) Circular No. 17/2019.
The appellant, ITO Ward – 1, Sonipat, challenged the order of the CIT(A), Rohtak, dated 13.01.2020. The dispute pertained to the assessment of Brij Pal Tyagi for the assessment year 2011-12. However, the ITAT dismissed the appeal based on the tax effect being below the threshold limit specified in the CBDT Circular No. 17/2019 dated 08.08.2019.
The main contention in this case was the application of the CBDT Circular No. 17/2019, which mandates that appeals should not be filed if the tax effect is less than Rs. 50 lakhs. This circular aims to reduce litigation and focus on high-value cases, thus optimizing the resources of the tax department and judiciary.
The case was heard on 02.11.2022. During the proceedings, it was established that the tax effect in this particular appeal was less than Rs. 50 lakhs. Consequently, the appeal was deemed not maintainable under the provisions of the aforementioned CBDT Circular.
The ITAT provided liberty to the revenue to approach the Tribunal again if it is established that the tax effect exceeds Rs. 50 lakhs.
The ITAT’s decision to dismiss the appeal emphasizes the importance of adhering to the CBDT Circular No. 17/2019, which seeks to minimize unnecessary litigation for low-value cases. The judgment reinforces the principle that the tax department should prioritize significant cases with higher tax effects, thereby ensuring efficient utilization of resources.
This case serves as a reminder for tax authorities to thoroughly evaluate the tax effect before filing appeals, ensuring compliance with the guidelines set forth in the CBDT Circular. It also highlights the judiciary’s role in upholding these guidelines to prevent overburdening the legal system with cases that do not meet the specified threshold.
In summary, the appeal by ITO Ward – 1, Sonipat against Brij Pal Tyagi for the assessment year 2011-12 was dismissed due to the tax effect being less than Rs. 50 lakhs, in accordance with CBDT Circular No. 17/2019. This decision underscores the ongoing efforts to streamline tax litigation and focus on substantial matters that significantly impact revenue collection.
ITO Ward – 1, Sonipat vs. Brij Pal Tyagi, Sonipat – ITA 1151/DEL/2020: Assessment Year 2011-12
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