Economy

CBDT hikes income tax appeal limit to Rs 50 lakh to reduce litigation

CBDT has increased the monetary limit from Rs 20 lakh to Rs 50 lakh for the IT department to appeal disputes before the Income Tax Appellate Tribunal. This will reduce litigations and ensure a smooth transition to the direct tax code.

The limit has been increased to Rs 1 crore in case of high courts and in case of Supreme Court; the limit is revised to Rs 2 crore from Rs 1 crore. The Finance Ministry revised these limits for the second time in a year.

Experts opined that this welcome move will further de-clog the courts and help the department to focus its resources on high-value cases. If the litigation cases are reduced in number under the current income tax law, the transition into the new direct tax code will be smoother.

Also Read: CBDT to Launch E-Assistance Campaign on Income Tax Day

According to the Economic Survey 2017-18, the revenue department had fared poorly in the appeals filed by it. This can be one of the reasons for the monetary limits to be increased.

The survey had also shown that the revenue department had a failure rate of over 65% out of the 85% of the total number appeals.

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