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?
Not if the case is within one of the circular's exceptions. The Delhi High Court, on a review petition, held that where the case of the Revenue before the Assessing Officer and the Commissioner (Appeals) was one of accommodation entries, it falls within exception (h) of the circular dated 15 March 2024 — 'cases involving organised tax evasion including cases of bogus capital gain/loss through penny stocks and cases of accommodation entries' — and the appeal is maintainable without regard to the tax effect. The review petition was dismissed.
Decided by the High Court (V. Kameswar Rao J and Vinod Kumar J (judgment by V. Kameswar Rao J)) on 2025-12-23, reported as Review Pet. 567/2025 in ITA 60/2024, High Court of Delhi; judgment reserved 24 November 2025, delivered 23 December 2025. It bears on section 268A, section 260A, section 151, section 147, section 148 of the Income Tax Act 1961, in Appeals and Reassessment & Reopening matters.
Practitioners reach for the monetary limits first and often stop there. This decision shows the department's answer: the limit in the circular is expressly subject to a list of exceptions, and an appeal within an exception is filed 'without regard to tax effect'. Exception (h) is the widest of them and catches most penny-stock and entry-provider litigation, which is precisely the litigation in which the tax effect is often modest. The judgment also traces the succession of circulars — the circular of 11 July 2018 replaced by that of 8 August 2019, which was superseded by that of 15 March 2024 — which matters because a practitioner arguing from the 2018 circular, as the review petitioner did, is arguing from a superseded instrument. The Court also refused to remand for grounds the assessee had not in fact pressed before the Tribunal, having examined the Tribunal's own record.
Binding within that High Court's jurisdiction. Persuasive elsewhere.
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The Revenue's appeal under s.260A, ITA 60/2024, had been decided by the Delhi High Court by judgment dated 6 October 2025. The assessee sought review on two grounds. The first was that the tax effect was less than Rs 1 crore so that the appeal was not maintainable in view of the circular dated 11 July 2018, a submission which had been made by its counsel at the hearing but on which the Court had recorded no finding. The second was that other grounds urged before the Tribunal had not been adjudicated, so the matter should be remanded. On the first, the Court traced the circulars: the circular of 11 July 2018 stood replaced by that of 8 August 2019, which was superseded by the circular dated 15 March 2024, under which an appeal may be filed before the High Court without regard to tax effect in certain exceptions, including exception (h) covering cases involving organised tax evasion, bogus capital gain or loss through penny stocks, and accommodation entries. On the second, the Court reproduced paragraphs 3 and 7 of the Tribunal's order.
The review petition was dismissed as bereft of merits (paragraph 11). The Court recorded that its failure to give a finding on the monetary-limits submission was inadvertent (paragraph 5), and held on the record that since the Revenue's case before the Assessing Officer and the Commissioner (Appeals) was one of accommodation entry, the case surely falls within exception (h), so the plea was liable to be rejected (paragraphs 6 and 7). On the remand plea, the Tribunal's own order showed that the assessee's appeal had been pressed only on the ground that the approval under s.151 was defective, mechanical and without application of mind, and nothing more, so there was nothing left unadjudicated (paragraph 10).
The Court did not treat the tax effect as decisive once the case fell within an exception; it asked instead how the Revenue had put its case below, and having found that the case advanced before both the Assessing Officer and the Commissioner (Appeals) was of accommodation entry, it read exception (h) as covering it directly. On the second limb it went to the Tribunal's record rather than to the memorandum of appeal, and having reproduced the relevant Tribunal paragraphs concluded that only the s.151 ground had been pressed.
In any case, having considered the record, it is clear that the case of the appellant/Revenue before the Assessing Officer and also the CIT (Appeals) was of accommodation entry. If that be so, the case surely falls within the exception (h).
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Handle my notice → Ask a CA on WhatsAppNot if the case is within one of the circular's exceptions. The Delhi High Court, on a review petition, held that where the case of the Revenue before the Assessing Officer and the Commissioner (Appeals) was one of accommodation entries, it falls within exception (h) of the circular dated 15 March 2024 — 'cases involving organised tax evasion including cases of bogus capital gain/loss through penny stocks and cases of accommodation entries' — and the appeal is maintainable without regard to the tax effect. The review petition was dismissed. This was decided by the High Court (V. Kameswar Rao J and Vinod Kumar J (judgment by V. Kameswar Rao J)) and bears on section 268A, section 260A, section 151, section 147, section 148 of the Income Tax Act 1961. It is reported as Review Pet. 567/2025 in ITA 60/2024, High Court of Delhi; judgment reserved 24 November 2025, delivered 23 December 2025. Practitioners reach for the monetary limits first and often stop there. This decision shows the department's answer: the limit in the circular is expressly subject to a list of exceptions, and an appeal within an exception is filed 'without regard to tax effect'. Exception (h) is the widest of them and catches most penny-stock and entry-provider litigation, which is precisely the litigation in which the tax effect is often modest. The judgment also traces the succession of circulars — the circular of 11 July 2018 replaced by that of 8 August 2019, which was superseded by that of 15 March 2024 — which matters because a practitioner arguing from the 2018 circular, as the review petitioner did, is arguing from a superseded instrument. The Court also refused to remand for grounds the assessee had not in fact pressed before the Tribunal, having examined the Tribunal's own record. If it applies to you, the first step is this: Before taking a monetary-limits objection, read the exceptions paragraph of the current circular and ask whether the department's case as pleaded before the Assessing Officer and the Commissioner (Appeals) was one of accommodation entries, penny stocks or organised evasion — the Court looked at how the Revenue had put its case, not at the head of addition.
The Revenue's appeal under s.260A, ITA 60/2024, had been decided by the Delhi High Court by judgment dated 6 October 2025. The assessee sought review on two grounds. The first was that the tax effect was less than Rs 1 crore so that the appeal was not maintainable in view of the circular dated 11 July 2018, a submission which had been made by its counsel at the hearing but on which the Court had recorded no finding. The second was that other grounds urged before the Tribunal had not been adjudicated, so the matter should be remanded. On the first, the Court traced the circulars: the circular of 11 July 2018 stood replaced by that of 8 August 2019, which was superseded by the circular dated 15 March 2024, under which an appeal may be filed before the High Court without regard to tax effect in certain exceptions, including exception (h) covering cases involving organised tax evasion, bogus capital gain or loss through penny stocks, and accommodation entries. On the second, the Court reproduced paragraphs 3 and 7 of the Tribunal's order. The matter was decided on 2025-12-23 by the High Court (V. Kameswar Rao J and Vinod Kumar J (judgment by V. Kameswar Rao J)). On those facts the High Court held as follows. The review petition was dismissed as bereft of merits (paragraph 11). The Court recorded that its failure to give a finding on the monetary-limits submission was inadvertent (paragraph 5), and held on the record that since the Revenue's case before the Assessing Officer and the Commissioner (Appeals) was one of accommodation entry, the case surely falls within exception (h), so the plea was liable to be rejected (paragraphs 6 and 7). On the remand plea, the Tribunal's own order showed that the assessee's appeal had been pressed only on the ground that the approval under s.151 was defective, mechanical and without application of mind, and nothing more, so there was nothing left unadjudicated (paragraph 10).
The Court did not treat the tax effect as decisive once the case fell within an exception; it asked instead how the Revenue had put its case below, and having found that the case advanced before both the Assessing Officer and the Commissioner (Appeals) was of accommodation entry, it read exception (h) as covering it directly. On the second limb it went to the Tribunal's record rather than to the memorandum of appeal, and having reproduced the relevant Tribunal paragraphs concluded that only the s.151 ground had been pressed. In the words reproduced by the source cited on this page: "In any case, having considered the record, it is clear that the case of the appellant/Revenue before the Assessing Officer and also the CIT (Appeals) was of accommodation entry. If that be so, the case surely falls within the exception (h)."
It was decided by the High Court on 2025-12-23 and is reported as Review Pet. 567/2025 in ITA 60/2024, High Court of Delhi; judgment reserved 24 November 2025, delivered 23 December 2025. Binding within that High Court's jurisdiction. Persuasive elsewhere. A High Court decision binds the assessing officer, the Commissioner (Appeals) and the Income Tax Appellate Tribunal within that state, and is persuasive elsewhere. If your assessment is in a different jurisdiction, check whether your own High Court has taken the same view before relying on it. On section 268A, section 260A, section 151, section 147, section 148, 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 department, and it appears in this library for that reason — you need to know what the Assessing Officer will cite against you. The review petition was dismissed as bereft of merits (paragraph 11). The Court recorded that its failure to give a finding on the monetary-limits submission was inadvertent (paragraph 5), and held on the record that since the Revenue's case before the Assessing Officer and the Commissioner (Appeals) was one of accommodation entry, the case surely falls within exception (h), so the plea was liable to be rejected (paragraphs 6 and 7). On the remand plea, the Tribunal's own order showed that the assessee's appeal had been pressed only on the ground that the approval under s.151 was defective, mechanical and without application of mind, and nothing more, so there was nothing left unadjudicated (paragraph 10). It arises in Appeals and Reassessment & Reopening matters, on section 268A, section 260A, section 151, section 147, section 148 of the Income Tax Act 1961, and was decided by V. Kameswar Rao J and Vinod Kumar J (judgment by V. Kameswar Rao J). 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. Take the objection at the hearing and get a finding on it; here the point had been argued but not decided, and the Court described its own omission as inadvertent and dealt with it on review. Cite the circular by date as well as number. The Court proceeded on the circular dated 15 March 2024, and the enhanced limits came later by the circular dated 17 September 2024; a submission that conflates them will be met with the wrong exceptions list. Where you seek a remand on grounds not adjudicated by the Tribunal, check the Tribunal's order first — the Court reproduced the Tribunal's paragraphs 3 and 7 and found that only the s.151 approval ground had actually been pressed. If you act for the department, plead the exception expressly in the memorandum of appeal rather than relying on the tax effect being disputed.
Searched for later treatment; none was found. That is not the same as a source affirming it. This judgment has survived a trip to the Supreme Court, but under Kunhayammed that is not an affirmance and it does not make the judgment good law. The name search turned up M/s Agroha Fincap Ltd v Pr. CIT-1 (Supreme Court, 4 August 2026, doc 192556468), which was read: it is an order in Review Petition (C) Nos. 10190-10191 of 2026 in SLP (C) Nos. 16510-16511 of 2026, dismissing the assessee's review of the Supreme Court's own order of 5 May 2026 by which the special leave petitions were disposed of. The operative words are 'The Review Petitions are, therefore, dismissed', the Court finding 'no error apparent on the face of the record'; the application to list the review in open court was also rejected. I could not retrieve the order of 5 May 2026 itself, so I cannot say whether the dismissal of the special leave petitions was reasoned or non-speaking; on the material available it must be treated as leaving the Delhi High Court judgment standing and nothing more. No later decision has applied, doubted or distinguished the holding that a case put to the Assessing Officer and the Commissioner (Appeals) as one of accommodation entries falls within exception (h) to the CBDT monetary-limit circular; the citedby search is empty. 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 is an order on a review petition (Review Pet. 567/2025) in ITA 60/2024, not the substantive judgment. The order contains a date conflict about the judgment under review: paragraph 1 says the review is sought of 'the judgment dated 06.10.2025 passed in the aforesaid appeal' and paragraph 2 repeats 'the order dated 06.10.2025', while paragraph 11 concludes that 'the order dated 05.10.2025 does not call for any review'. The 6 October 2025 date appears twice and is taken as the judgment date; the discrepancy is recorded rather than resolved. The order runs to eleven numbered paragraphs and ends at paragraph 11 with the judges' names and the date. Paragraphs 1, 8 and 9 reproduce, respectively, paragraphs 6 to 9 of the review petition and paragraphs 3 and 7 of the Tribunal's order; the retrieval returned markers rather than that quoted text, so nothing is stated here from those passages. The words of exception (h) are the circular's own words, quoted by the Court at paragraph 4 inside quotation marks; they are reproduced in the summary as the circular's words and the key quote is taken instead from paragraph 6, which is the Court speaking. The exception letter (h) is as the Court prints it and has not been checked against the circular itself. 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.
The review petition was dismissed as bereft of merits (paragraph 11). The Court recorded that its failure to give a finding on the monetary-limits submission was inadvertent (paragraph 5), and held on the record that since the Revenue's case before the Assessing Officer and the Commissioner (Appeals) was one of accommodation entry, the case surely falls within exception (h), so the plea was liable to be rejected (paragraphs 6 and 7). On the remand plea, the Tribunal's own order showed that the assessee's appeal had been pressed only on the ground that the approval under s.151 was defective, mechanical and without application of mind, and nothing more, so there was nothing left unadjudicated (paragraph 10).
TaxSphere, “PCIT v Agroha Fincap Ltd — an accommodation-entry case falls within exception (h) of the CBDT circular, so the monetary limit does not save the assessee”, https://taxnotice.vittsphere.com/caselaw/case/pcit-v-agroha-fincap-accommodation-entry-case-falls-within-exception-h-and-survives-the-monetary-limit/ (validity last checked 2026-09-08)
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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?
The department says the monetary limit does not apply to my case. Which exceptions let it appeal anyway?
The department has appealed against my order. Is the tax effect too small for it to appeal at all?
The sanctioning authority just wrote 'yes' and signed. Is that a sanction?
