The Income Tax Appellate Tribunal (ITAT), Kolkata Bench, has recently in an appeal filed before it, held that income tax authorities are bound to follow CBDT circulars.
The aforesaid observation was made by the Tribunal, when an appeal was filed before it by the Revenue, as directed against the order dated 13.08.2019 of the Commissioner of Income Tax (Appeals)-5, Kolkata.
The tax effect on the disputed additions being less than Rs.50 lacs as prescribed in the CBDT’s latest Circular No.17/2019 dated 08.08.2019, it was observed by the Tribunal consisting of Girish Agrawal, the Accountant Member and Sanjay Garg, the Judicial Member that the aforesaid Circular aswell as the materials available,revealed the revised monetary limits to be applicable retrospectively to pending appeals as well.
“The Hon’ble apex court in Commissioner of Customs vs. Indian Oil Corporation Ltd., has settled the law that CBDT’s circulars are very much binding on revenue authorities. The ld. DR has also fairly stated that tax effect involved in appeal is less than the prescribed limit.”, the Bench commented.
Thus, hearing the opposing contentions of the appellant (Revenue), as was presented by Smt. Ranu Biswas, Addl. CIT, and that of the respondent (assesse) as was submitted by Shri A. K. Tibrewal, FCA, the Tribunal ruled:
“In view of above stated position, the appeal of the Revenue is dismissed because of low tax effect than the prescribed limits as per CBDT Circular No.17/2019”.
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