The department has appealed against my order. Is the tax effect too small for it to appeal at all?
With effect from 17 September 2024 the Department is not to file an appeal where the tax effect does not exceed Rs. 60 lakh before the ITAT, Rs. 2 crore before a High Court or Rs. 5 crore before the Supreme Court. It applies to appeals filed after that date and to pending appeals, which may be withdrawn where the tax effect is below the enhanced figures.
Decided by the CBDT Circulars & Instructions (Central Board of Direct Taxes) on 2024-09-17, reported as Circular No. 9/2024 [F. No. 279/Misc./M-74/2024-ITJ], dated 17 September 2024, issued under section 268A of the Income-tax Act, 1961. It bears on section 268A, section 158AB of the Income Tax Act 1961, in Appeals matters.
This gets low-tax-effect departmental appeals disposed of without arguing the merits, and it reaches appeals already pending. It also gives you a second point: the circular says an appeal is not to be filed merely because the tax effect exceeds the limit, so merit has to be assessed independently. It amends rather than replaces Circular 5/2024, which is where the exceptions still live.
Binding on the department, not on the assessee or the courts. An assessee may rely on a circular that is beneficial to them.
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Section 268A empowers the Board to fix monetary limits regulating the filing of appeals or applications for reference by income-tax authorities. Circular No. 5/2024 dated 15 March 2024 had specified those limits in its para 4.1 and the exceptions to them in its paras 3.1 and 3.2. Circular 9/2024 was issued as a further step in the management of litigation, and it does one thing: it revises the table in para 4.1 of Circular 5/2024. It amends rather than replaces that circular, and expressly leaves the exceptions in paras 3.1 and 3.2 in force.
With effect from the date of issue, 17 September 2024, appeals and SLPs are not to be filed where the tax effect does not exceed Rs. 60 lakh before the Income Tax Appellate Tribunal, Rs. 2 crore before a High Court or Rs. 5 crore before the Supreme Court. Those limits apply to all cases including TDS and TCS, subject to the exceptions in paras 3.1 and 3.2 of Circular 5/2024, where the decision to appeal is taken on merits without regard to tax effect. An appeal is not to be filed merely because the tax effect exceeds the limit; that decision is on the merits, with the officer keeping in mind the objective of reducing unnecessary litigation and giving taxpayers certainty. The circular applies to appeals and SLPs to be filed henceforth and also to those already pending before the Supreme Court, High Courts and the Tribunal, which may accordingly be withdrawn.
Section 268A lets the Board keep small-tax-effect disputes out of the appellate system while leaving it free to litigate issues that matter irrespective of quantum. Circular 9/2024 works only on the threshold, and it is deliberately economical: it substitutes the table, restates that crossing the threshold is a necessary but not a sufficient reason to appeal, and cross-refers the exceptions to paras 3.1 and 3.2 of Circular 5/2024 rather than reproducing them. Those exceptions cover a provision or a Board instrument held invalid or ultra vires, assessments based on information from law enforcement or intelligence agencies, cases where prosecution is pending or a conviction stands uncompounded, cases where strictures or costs have been imposed on the Department, cases where the tax effect is not quantifiable at all - the circular instances trust registration under sections 10(23C) and 12A/12AA/12AB and orders under section 263 - undisclosed foreign income or assets, organised tax evasion including penny-stock and accommodation-entry cases, court-directed appeals, writ matters, wealth tax, fringe benefit tax and equalisation levy matters, TDS/TCS disputes turning on the nature of the transaction, international taxation disputes on the applicability of a double taxation avoidance agreement, cases the Board specifies by circular, and the section 158AB deferral cases dealt with by Circular No. 8/2023. Because the new limits reach pending appeals, courts have been disposing of departmental appeals below them; the reported instances rest on Circular 5/2024, into which the revised figures were written.
It is clarified that an appeal should not be filed merely because the tax effect in a case exceeds the monetary limits prescribed above.
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Handle my notice → Ask a CA on WhatsAppWith effect from 17 September 2024 the Department is not to file an appeal where the tax effect does not exceed Rs. 60 lakh before the ITAT, Rs. 2 crore before a High Court or Rs. 5 crore before the Supreme Court. It applies to appeals filed after that date and to pending appeals, which may be withdrawn where the tax effect is below the enhanced figures. This was decided by the CBDT Circulars & Instructions (Central Board of Direct Taxes) and bears on section 268A, section 158AB of the Income Tax Act 1961. It is reported as Circular No. 9/2024 [F. No. 279/Misc./M-74/2024-ITJ], dated 17 September 2024, issued under section 268A of the Income-tax Act, 1961. This gets low-tax-effect departmental appeals disposed of without arguing the merits, and it reaches appeals already pending. It also gives you a second point: the circular says an appeal is not to be filed merely because the tax effect exceeds the limit, so merit has to be assessed independently. It amends rather than replaces Circular 5/2024, which is where the exceptions still live. If it applies to you, the first step is this: Work out the tax effect for the year in dispute and file a short application before the forum seeking disposal of the departmental appeal on that basis.
Section 268A empowers the Board to fix monetary limits regulating the filing of appeals or applications for reference by income-tax authorities. Circular No. 5/2024 dated 15 March 2024 had specified those limits in its para 4.1 and the exceptions to them in its paras 3.1 and 3.2. Circular 9/2024 was issued as a further step in the management of litigation, and it does one thing: it revises the table in para 4.1 of Circular 5/2024. It amends rather than replaces that circular, and expressly leaves the exceptions in paras 3.1 and 3.2 in force. The matter was decided on 2024-09-17 by the CBDT Circulars & Instructions (Central Board of Direct Taxes). On those facts the CBDT Circulars & Instructions held as follows. With effect from the date of issue, 17 September 2024, appeals and SLPs are not to be filed where the tax effect does not exceed Rs. 60 lakh before the Income Tax Appellate Tribunal, Rs. 2 crore before a High Court or Rs. 5 crore before the Supreme Court. Those limits apply to all cases including TDS and TCS, subject to the exceptions in paras 3.1 and 3.2 of Circular 5/2024, where the decision to appeal is taken on merits without regard to tax effect. An appeal is not to be filed merely because the tax effect exceeds the limit; that decision is on the merits, with the officer keeping in mind the objective of reducing unnecessary litigation and giving taxpayers certainty. The circular applies to appeals and SLPs to be filed henceforth and also to those already pending before the Supreme Court, High Courts and the Tribunal, which may accordingly be withdrawn.
Section 268A lets the Board keep small-tax-effect disputes out of the appellate system while leaving it free to litigate issues that matter irrespective of quantum. Circular 9/2024 works only on the threshold, and it is deliberately economical: it substitutes the table, restates that crossing the threshold is a necessary but not a sufficient reason to appeal, and cross-refers the exceptions to paras 3.1 and 3.2 of Circular 5/2024 rather than reproducing them. Those exceptions cover a provision or a Board instrument held invalid or ultra vires, assessments based on information from law enforcement or intelligence agencies, cases where prosecution is pending or a conviction stands uncompounded, cases where strictures or costs have been imposed on the Department, cases where the tax effect is not quantifiable at all - the circular instances trust registration under sections 10(23C) and 12A/12AA/12AB and orders under section 263 - undisclosed foreign income or assets, organised tax evasion including penny-stock and accommodation-entry cases, court-directed appeals, writ matters, wealth tax, fringe benefit tax and equalisation levy matters, TDS/TCS disputes turning on the nature of the transaction, international taxation disputes on the applicability of a double taxation avoidance agreement, cases the Board specifies by circular, and the section 158AB deferral cases dealt with by Circular No. 8/2023. Because the new limits reach pending appeals, courts have been disposing of departmental appeals below them; the reported instances rest on Circular 5/2024, into which the revised figures were written. In the words reproduced by the source cited on this page: "It is clarified that an appeal should not be filed merely because the tax effect in a case exceeds the monetary limits prescribed above."
It was decided by the CBDT Circulars & Instructions on 2024-09-17 and is reported as Circular No. 9/2024 [F. No. 279/Misc./M-74/2024-ITJ], dated 17 September 2024, issued under section 268A of the Income-tax Act, 1961. Binding on the department, not on the assessee or the courts. An assessee may rely on a circular that is beneficial to them. A CBDT circular or instruction binds officers of the department but not the assessee and not the courts. Where a circular helps you, you may hold the department to it. Where it hurts you, it cannot override the Act or a judgment. On section 268A, section 158AB, the practical question is whether the facts of your own notice match the facts of this case closely enough for the same rule to apply.
It helps the taxpayer. With effect from the date of issue, 17 September 2024, appeals and SLPs are not to be filed where the tax effect does not exceed Rs. 60 lakh before the Income Tax Appellate Tribunal, Rs. 2 crore before a High Court or Rs. 5 crore before the Supreme Court. Those limits apply to all cases including TDS and TCS, subject to the exceptions in paras 3.1 and 3.2 of Circular 5/2024, where the decision to appeal is taken on merits without regard to tax effect. An appeal is not to be filed merely because the tax effect exceeds the limit; that decision is on the merits, with the officer keeping in mind the objective of reducing unnecessary litigation and giving taxpayers certainty. The circular applies to appeals and SLPs to be filed henceforth and also to those already pending before the Supreme Court, High Courts and the Tribunal, which may accordingly be withdrawn. It arises in Appeals matters, on section 268A, section 158AB of the Income Tax Act 1961, and was decided by Central Board of Direct Taxes. Before relying on it, read the source linked on this page and check whether it has since been distinguished, overruled or overtaken by an amendment to the Income Tax Act. In practice the steps that follow from it are these. Before quoting any threshold, pull the circular actually in force when your appeal was filed and when it is heard and check the figure against it — do not rely on the number recited in a judgment, a digest or this entry. Check the exceptions carried over from Circular 5/2024 first; if the case falls in one of them, the limit will not help you. Where an appeal is filed just above the limit, argue merit separately — crossing the threshold is not by itself a reason to appeal.
Still good law. In force. The database annotates Circular 5/2024 as amended by this circular and carries no annotation of any later amending or superseding circular, so these remain the operative figures. Note a limit on the reported judicial application: in Principal Commissioner of Income-tax v. Sulzer Pumps India Ltd. [2025] 174 taxmann.com 202 (Bombay) (M.S. Sonak and Jitendra Jain, JJ., IT Appeal No. 32 of 2019, 16 April 2025) the Court disposed of a departmental appeal with a tax effect of Rs. 12,11,053 and recorded that the ceiling for a High Court appeal is Rs. 2 crore, but it decided the matter by reference to Circular No. 5/2024 and did not name Circular 9/2024. Whether the Board has re-issued these limits under the Income-tax Act, 2025 was not established. No source could be cited for that finding. Checking whether an authority still stands matters as much as knowing what it held: a decision may be overruled on one point and survive on another, or the provision it interprets may have been amended since. Read the source and the editor's note on this page before relying on it in a reply to an Assessing Officer or in an appeal.
This circular is one page and does two things: it substitutes the table in para 4.1 of Circular 5/2024, and it says the new limits apply to pending appeals as well, which may be withdrawn. It does not restate the exceptions, so quote those from paras 3.1 and 3.2 of Circular 5/2024. The order commonly cited for the point that an exception lost in the 2024 consolidation cannot be revived is Principal Commissioner of Income-tax v. Sulzer Pumps India Ltd., not CIT v. Sulzer Pumps, and it applies Circular 5/2024. The figures in force between 15 March 2024 and 17 September 2024 could not be read from Circular 5/2024 itself, because the database displays that circular with para 4.1 already substituted; Circular 9/2024 does not recite the figures it replaces. Whether CBDT has re-issued the limits under the Income-tax Act, 2025 was not established. This library shows the verification state of every entry openly. This entry has not yet been read in full by a chartered accountant. The summary reflects the sources listed on this page. Read the source before you rely on it in a reply to an Assessing Officer or in an appeal before the Commissioner (Appeals) or the Income Tax Appellate Tribunal.
With effect from the date of issue, 17 September 2024, appeals and SLPs are not to be filed where the tax effect does not exceed Rs. 60 lakh before the Income Tax Appellate Tribunal, Rs. 2 crore before a High Court or Rs. 5 crore before the Supreme Court. Those limits apply to all cases including TDS and TCS, subject to the exceptions in paras 3.1 and 3.2 of Circular 5/2024, where the decision to appeal is taken on merits without regard to tax effect. An appeal is not to be filed merely because the tax effect exceeds the limit; that decision is on the merits, with the officer keeping in mind the objective of reducing unnecessary litigation and giving taxpayers certainty. The circular applies to appeals and SLPs to be filed henceforth and also to those already pending before the Supreme Court, High Courts and the Tribunal, which may accordingly be withdrawn.
Every entry in this library links to where it was found, so you can check it yourself rather than take our word for it.
The department says the monetary limit does not apply to my case. Which exceptions let it appeal anyway?
The tax effect in the department's High Court appeal is below the circular limit. My client says the appeal must go. Is that the end of it?
The department's Tribunal appeal against my client is below the monetary limit. Will the Tribunal simply dismiss it, and is that the end of the matter?