TMI Blog2020 (9) TMI 1252X X X X Extracts X X X X X X X X Extracts X X X X ..... ains exemption through penny stocks, we find that the CBDT has since come out with a special order communicated vide office memorandum dated 16.09.2019 stating that monetary limits fixed for filing appeals in these cases before the Tribunal, High Court and Supreme Court shall not apply in case of assessee claiming bogus LTCG/STCG through penny stock and appeal shall be filed on merits. The special order thus talks about filing of appeal in such cases and therefore, it relates to any appeal in such cases which can be filed pursuant to such an order on and after the date of such special order and therefore doesn't contemplate a situation where the appeal which has already been filed prior to issuance of such a special order by the Revenue which shall be read and understood as filed pursuant to such special order. CBDT low tax effect circulars issued from time to time wherein the tax effect have been progressively increased by the -Revenue with a view to minimize the litigation has been read by the Courts and the Tribunal, and even the CBDT has also clarified latter, that these CBDT Circulars shall apply not just to future appeals but also to pending appeals and therefore, wher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... K. Patel, AR, Shri Nupur shah, AR, Shri Nupur Shah, AR, Shri Hardik Vora, AR O R D E R PER RAJPAL YADAV, VICE PRESIDENT: The present miscellaneous applications are directed at the instance of the Revenue pointing out an apparent error in the common order of the Tribunal dated 14/08/2019. 2. It is pertinent to note that CBDT has issued Circular No.17 of 2019 dated 08/08/2019, whereby it was provided that appeals of the Revenue will not be maintainable before the Tribunal if tax effect involved by virtue of relief given by the CIT(A) is less than Rs.50 lakhs in each case. After issuance of this Circular, Tribunal has identified 628 appeals including Cross Objections, where tax effect by virtue of relief given by the Ld.CIT(A) was less than Rs.50 lakhs. The ITAT the help of the Circular dismissed those appeals. 3. In the present Miscellaneous Application(s), it has been contended that after the Circular No.17 of 2019, the Department has issued Circular 23 of 2019 dated 06/09/2019 which reads as under: CIRCULAR NO. 23 OF 2019 [F.NO.279/MISC./M-93/2018- SECTION 268A OF THE INCOME-TAX ACT, 1961 - FILING OF APPEALS OR APPLICATION FOR REFERENCE BY INCOME-TAX ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .NO. 279/MISC./M-93/2018-ITJ(PT.), DATED 16-9-2019 The undersigned is directed to refer to Circular No. 23 of 2019 dated 6th September, 2019 and to say that by virtue of powers of the Central Board of Direct Taxes under section 268A of Income-tax Act, 1961, the monetary limits fixed for filing appeals before ITAT/HC and SLPs/appeals before Supreme Court shall not apply in case of assessees claiming bogus LTCG/STCL through penny stocks and appeals/SLPs in such cases shall be filed on merits. 4. On the strength of these Circulars (supra), the Department filed present Miscellaneous Applications and contended therein that where an assessee has claimed Long Term Capital Gain/Short Term Capital Loss on penny stock and Assessing Officer has disallowed such claim by treating the transactions of the assessee as bogus but CIT(A) has allowed the appeals on such issues and vacated the action of the Assessing Officer, then in such cases, appeals at the instance of Revenue would not be dismissed on the strength of Circular No.17 of 2019 dated 08/08/2019, i.e. simply for the reason that tax effect is involved in such appeals is less than Rs.50 lakhs. 5. The Ld.DR relied upon the subsequ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A of the Income-tax Act, 1961 (the Act), for laying down monetary limits and other conditions for filing of departmental appeals 'before Income Tax Appellate Tribunal (TTAT). High Courts and. SLPs/appeals before Supreme Court. 2. Several references have been received by the Board that in large number of cases where organised tax-evasion scam is noticed through bogus Long-Term Capital Gain (LTCG)/Short Term Capital Loss (STCL) on penny stocks and department is unable to pursue the cases in higher judicial fora on account of enhanced monetary limits. It has been reported that in large number of cases, JTATs and High Court have recognized the unique modus operand! involved in such scam and have passed judgments in favour of the revenue. However, in cases where some appellate fora have not given due consideration to position of law or facts investigated by the department, there is no remedy available with the department for filing further appeal in view of the prescribed monetary limits. 3. In this context, Board has decided that notwithstanding anything contained in any circular issued u/s 268A specifying monetary limits for filing of departmental appeals before Income Tax A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in these cases before the Tribunal, High Court and Supreme Court shall not apply in case of assessee claiming bogus LTCG/STCG through penny stock and appeal shall be filed on merits. The special order thus talks about filing of appeal in such cases and therefore, it relates to any appeal in such cases which can be filed pursuant to such an order on and after the date of such special order and therefore doesn't contemplate a situation where the appeal which has already been filed prior to issuance of such a special order by the Revenue which shall be read and understood as filed pursuant to such special order. 8. We are conscious of the fact that CBDT low tax effect circulars issued from time to time wherein the tax effect have been progressively increased by the -Revenue with a view to minimize the litigation has been read by the Courts and the Tribunal, and even the CBDT has also clarified latter, that these CBDT Circulars shall apply not just to future appeals but also to pending appeals and therefore, where the appeal has already been filed'by the Revenue and is pending, such appeal has been held to be covered by a subsequent low tax effect circular and dismissed on ..... X X X X Extracts X X X X X X X X Extracts X X X X
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