TMI Blog2004 (8) TMI 353X X X X Extracts X X X X X X X X Extracts X X X X ..... avour with the Assessing Officer. He, therefore, clubbed the income of Dev Raj Agarwal, HUF with the income of the assessee individual. On appeal, the ld. CIT(A) deleted the addition by holding that the HUF's income was separately taxable and the same could not be clubbed with that of individual. In the assessment year 1998-99, the Assessing Officer had also made an addition of Rs. 25,000 under the head 'income from other sources', which was reduced by the ld. CIT(A) after allowing a relief of Rs. 20,800. The finding of the ld. CIT(A) on both the counts have been challenged before us. While the ld. DR supported the order of the Assessing Officer, the learned Counsel raised a preliminary objection regarding the admissibility of appeals directed by the Revenue on the ground that the tax effect involved in these appeals was much less than the monetary limit prescribed by the Board for filing the appeals before the Tribunal. On merits, the learned Counsel relied on the order of the ld. CIT(A). 4. We have considered the rival submissions. As an objection has been raised before us regarding the admissibility of the appeals, we thought it better to adjudicate this issue first. The filin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er than of low tax effect, he is effected to send a report in the matter for obtaining the board's approval. 3.1 The present monetary limits of Rs. 10,000 for reference to the High Court and of Rs. 30,000 for appeal to the Supreme Court laid down in Instruction No. 284, dated 10th January, 1975 will continue. The limit of Rs. 10,000 for reference to the High Court, however, shall be relaxed where the question of law is repetitive and the cumulative tax effect in a number of cases is bound to be substantial. In such cases whereas the first reference to the High Court may be filed howsoever low, the tax effect may be subsequent references should be filed only if the tax effect in each reference is more than Rs. 5,000. 4. The board has further decided that no departmental appeal on questions of fact need be filed against the order of the AACs/CITs if the tax effect/reduction in penalty is Rs. 5,000 or less in respect of an income-tax appeal and Rs. 2,000 or less in respect of an appeal under other direct taxes. Repetitive appeals need not be filed on the same legal issue if the tax effect in each such order is Rs. 1,000 or less." From the perusal of the aforesaid instruction iss ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct" was used by the C.B.D.T. for the first time while revising the monetary limits. As already discussed, the specific expression "tax effect" was invariably used by the C.B.D.T. in its earlier instructions, but the reference made in the Instruction No. 1777 dated 4-11-1987 to the expression "revenue effect" gave rise to some controversy. It is worthwhile to note that in the said instruction issued on 4-11-1987, reference was made by the Board to the earlier Instruction Nos. 1573 dated 7-12-1984 and 1612 dated 6-4-1985 and it was categorically stated therein that the guidelines issued in the said instructions should be strictly adhered to subject only to the exceptions given in the instruction issued on 4-11-1987. Subsequently, the Board issued another instruction bearing No. 1979 dated 27-3-2000, para No. 2 of which being relevant in the present context is reproduced below: "2. In supersession of the above instruction, it has now been decided by the Board that appeals will be filed only in cases where the tax effect exceeds the revised monetary limits given hereunder:- (Tax effect) (i) Appeal before the Appellate Tribunal (in income-tax matters) Rs. 1,00,000 (ii) Appeal un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... taken singly. In other words, in group cases, each case should individually satisfy the new monetary limits. The working out of monetary limits will, therefore, not take into consideration the cumulative revenue effect as envisaged in Board's earlier Instruction referred to above. 3. Adverse judgments relating to the following should be contested irrespective of revenue effect: (i) Where Revenue Audit objection in the case has been accepted by the Department. (ii) Where Board's order, notification, instruction or circular is the subject-matter of an adverse order. (iii) Where prosecution proceedings are contemplated against the assessee. (iv) Where the constitutional validity of the provisions of the Act are under challenge. 4. Special Leave Petitions under Article 136 of the Constitution are filed before the Supreme Court only in consultation with Ministry of Law. Therefore, where the Chief Commissioner decides to contest an adverse judgment by filing special leave petition before the Supreme Court, they should send the proposal to the Board for further processing. 5. These instructions will apply to litigation under other Direct taxes also e.g., wealth-tax, gift-tax ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commissioner of Customs [2003] 5 SCC 528 observed that although a circular is not binding on a court or an assessee, it is not open to the Revenue to raise a contention that is contrary to a binding circular by the Board. When a circular remains in operation, the Revenue is bound by it and cannot be allowed to plead that it is not valid nor that it is contrary to the terms of the statute. Despite the decision of the court, the Department cannot be permitted to take a stand contrary to the instructions issued by the Board. The Hon'ble Supreme Court also observed that it was not open to the Revenue to advance an argument or file an appeal contrary to the circulars. 7. Keeping in view the decision of the Jurisdictional High Court mentioned earlier and the decision of the Hon'ble Supreme Court on this very issue, though pertaining to the Central Excise and Customs, we hold that if an appeal has been directed by the Revenue where the tax effect involved was less than the monetary limit prescribed by the Board, such appeal was not maintainable. Respectfully following the decisions mentioned earlier, we find force in the arguments of the learned counsel regarding his preliminary object ..... 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