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Appeal to High Court-Monetary Limits prescribed for litigation by Revenue
March, 27th 2000

Appeal to High Court Reference Circular- Monetary Limits prescribed for litigation by Revenue Also Applicable to old references    which are undecided- CBDT  Circular dated 27-3-2000

            The CBDT by its circular dated 27-3-2000 has taken a policy decision not to file references if the tax effect is less than Rs. 2 lakhs.  The circular is applicable even to the old references which are still undecided.  The Department cannot content that the circular is binding only with respect to the new cases and not with respect to the old referred cases even if the tax is less than Rs. 2 lacks.  The same policy for old matters needs to adopted by the Department.

                        The Court further held that this court can very well take judicial notice of the fact that by passage of time money value has gone down, the cost of litigation expenses has gone up, the assessees on the file of the Departments have increased ; consequently, the burden on the Department has also increased to a tremendous extent.  The corridors of the superior courts are choked with huge pendency of cases.  In this view of the matter, the Board has rightly taken a decision not to file references if the tax effect is less than Rs. 2 lakhs. The same policy for old matters needs to be adopted by the Department.  In our view, the Boards circular dated March 27, 2000, is very much applicable even to the old references which are still undecided.  The Department is not justified in proceeding with the old references wherein  the tax impact is minimal.  Thus, there is no justification to proceed with decades old references having negligible tax effect.

            [CIT vs. Pithwa Engg. Works (2005) 276 ITR 519 (Bom)



Direct Tax Instruction No. 2 dated 24 October 2005




Appeals filed by IT Department


Sub Topic

Revision of monetary limits



The CBDT revised the prescribed monetary limits for filing appeals, which had been notified vide Instruction No. 1985 dated 27 March 2000 and Instruction No. 1985 dated 29 June 2000. It also clarified that in cases where a substantial question of law was involved, the appellate authorities could proceed without being hindered by monetary limits.


All Chief Commissioners of Income Tax and
Directors General of Income Tax.

Revision of monetary limits for filing appeals by Department before various appellate bodies or appellate authorities clarification thereon regarding.

Reference is invited to Boards Instruction No.1979 dated 27.3.2000 [F.No.279/126/98-ITJ dt. 27.3.2000] and Instruction No.1985 dated 29.6.2000 [F.No.279/126/98-ITJ dated 29.6.2000] wherein monetary limits for filing appeals/references before various appellate authorities have been prescribed.

2. In partial modification of the above instruction, it has now been decided by the Board that appeals will henceforth be filed only in cases where the tax effect exceeds the revised monetary limits given hereunder:-

Sl. No.




Appeal before Appellate Tribunal



Appeal u/s 260A



Appeal before the Supreme Court


3. The Board has also decided that in cases involving substantial question of law of importance as well as in cases where the same question of law will repeatedly arise, either in the case concerned or in similar cases, should be separately considered on merits without being hindered by the monetary limits.

4. Subject to the paragraphs 2 and 3 above, the Instruction No.1979 dated 27.3.2000 as clarified subsequently in Instruction No.1985 dated 29.6.2000, will continue to govern the decision for filing of departmental appeals.

5. This Instruction will come into effect from 31.10.2005.

S.C.L. Dhamija


Government of India
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
New Delhi

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