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2020 (2) TMI 1233 - HC - Income TaxRectification u/s 254 - Revenue appeal dismissed on low tax effect - HELD THAT:- Appeal of Revenue was dismissed by the Tribunal on account of low tax effect in view of the CBDT Circular No. 03 of 2018 dated 11.7.2018. Thereafter, the application for rectification was filed which was dismissed vide impugned order holding that this was outside the scope of rectification. Today, learned counsel has argued that the case was wrongly dismissed on account of low tax effect whereas it was covered by exceptions in Circular. When we go through the circular, the only item which could be possibly related is para No. 10 of the circular which is quoted herein below “10. Adverse judgments relating to the following issues should be contested on merits notwithstanding that the tax effect entailed is less than the monetary limits specified in para 3 above or there is no tax effect : (a) Where the Constitutional validity of the provisions of an Act or Rule is under challenge, or (b) Where Board's order, Notification, Instruction or Circular has been held to be illegal or ultra vires, or (c) Where Revenue Audit objection in the case has been accepted by the Department, or (d) Where the addition relates to undisclosed foreign assets/band account.” The only point to which this argument can be relatable is Clause 10 (b). We asked the learned counsel where any Notification, Order, Instruction or Circular has been held to be illegal or ultra vires. Her argument is that though no Order, Notification, Instructions or Circular has been held to be legal or ultra vires but effect of the said Circular has not been correctly understood. In our considered view, that is beyond the exception clause count down by the circular. No substantial question of law proposed arises.
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