Law: Income Tax Act, 1961

Section: 268A

Section 268A, read with sections 119 and 260A of the Income-tax Act, 1961 - Appeals - Filing of appeals or application for reference by Income-tax authority - Assessment year 1993-94 - Whether as per section 268A, CBDT is authorized to issue orders, instructions or directions to Income-tax authorities laying monetary limits for purpose of filing appeals - Held, yes - Whether National Litigation Policy was formulated to reduce cases pending in various Courts and to make Government an efficient litigant - Held, yes - Whether Instruction No.3 of 2011 clearly indicates that no appeal could be filed where tax effect was less than Rs.10 lakhs - Held, yes - Whether since Instruction No.3 of 2011 had not been made applicable to pending cases as laid down by National Litigation Policy, it only fulfilled requirement partially - Held, yes - Whether thus, in order to bring harmony with National Litigation Policy, Instruction No.3 of 2011 would also apply to pending appeals in various Courts or Tribunals unless it is pointed out by department that appeal would have a cascading effect in other assessment years of assessee or that it is within exception provided in instructions that was issued at time when appeal was presented - Held, yes [Para 47] [In favour of assessee] Circulars and Notifications : Instruction No.5 of 2008, dated 15-5-2008; Instruction No.3 of 2011, dated 9-2-2011; Instruction No.1777, dated 4-11-1987; Instruction No.1979, dated 27-3- 2000; Instruction No.2 of 2005, dated 24-10- 2005; Instruction No.1903, dated 28-10-1992 FACTS â–  The revenue authorities filed instant appeals and since the tax effect was more than Rs.2 lakhs, the appeal was presented on 24-12-2004 on the basis of Instruction No.1979, dated 27-3- 2000. â–  The assessee raised a preliminary objection stating that under the Instructions No.3 of 2011, the monetary limit for filing an appeal by the department was Rs.10 lakhs, whereas the tax effect in the instant appeal was less than Rs.10 lakhs and, therefore, the appeal should be dismissed as not maintainable. â–  However, the department repudiating the preliminary objection raised by the assessee contended that the…