Dismissed¶¶40

Pr Commissioner of Income Tax 4 v. Blue Square Corporate Service Pvt. Ltd.

Bombay HC20 Sept 2025IA/1075/2025

Case brief

AI extract

What is this about?

Restoration of withdrawn income tax appeal; CBDT Circular dated 17 September 2024 monetary limits; exception 3.1(h) of CBDT Circular dated 15 March 2024 prospective application only; A.Y. 2009-2010; tax effect Rs. 1.22 crore; appeal filed 2 February 2021; Bombay High Court; Pr. CIT v. Sunraj Industries relied upon; interim application dismissed, no costs.

What did the court decide?

The reliance placed by the Revenue on exception 3.1(h) of the CBDT Circular dated 15 March 2024 is wholly misplaced. ¶¶21

Pr Commissioner of Income Tax 4 vs Blue Square Corporate Service Pvt. Ltd. — Bombay HC (2025) — LawSathi Research

What the court decided

AI extract

Outcome

Dismissed

¶¶40

Issue for consideration

Whether the Revenue's Interim Application for restoration of Income Tax Appeal No. 1107 of 2021, withdrawn on 16 October 2024 because the tax effect fell below the monetary limits of the CBDT Circular dated 17 September 2024, should be allowed on the ground that the case falls within exception 3.1(h) of the CBDT Circular dated 15 March 2024. +1 more

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Court's answer

The reliance placed by the Revenue on exception 3.1(h) of the CBDT Circular dated 15 March 2024 is wholly misplaced.

¶¶21

Ratio / Principle

Exceptions carved out by CBDT Circulars apply only prospectively, i.e., from the date of introduction of such exception, and would not apply if introduced after the filing of the appeal; hence the exception in the Circular dated 15 March 2024 cannot justify prosecuting an appeal filed on 2 February 2021.

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Key takeaways

No case is made out for restoration of the appeal, since the tax effect was admittedly below the monetary limits in the CBDT Circular dated 17 September 2024; the appeal was correctly withdrawn on 16 October 2024.ratio¶¶39

Detailed headnote1 paragraphs

Bombay High Court dismissed the Revenue's Interim Application No. 1075 of 2025 seeking restoration of Income Tax Appeal No. 1107 of 2021 (A.Y. 2009-2010; disputed tax effect Rs. 1.22 crore), which had been withdrawn by the Revenue on 16 October 2024 as the tax effect fell below the monetary limits prescribed in the CBDT Circular dated 17 September 2024. The Court held that exception 3.1(h) of the CBDT Circular dated 15 March 2024, invoked by the Revenue, applies only prospectively from its date of introduction and cannot justify prosecuting an appeal filed on 2 February 2021; the reliance on the exception was 'wholly misplaced'. Following the settled line of decisions of the Court, including Pr. CIT v. M/s. Sunraj Industries (ITA No. 2263 of 2018, decided 13 August 2025), the Court found no case for restoration, held that the appeal had been correctly withdrawn, and dismissed the application with no order as to costs.

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6.os.ia.1075.2025.doc

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Digitally signed by VINA VINA ARVIND ARVIND KHADPE KHADPE Date: 2025.09.24 12:26:09 +0530

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IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION

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INTERIM APPLICATION NO.1075 OF 2025 IN

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INCOME TAX APPEAL NO.1107 OF 2021

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Pr. Commissioner of Income Tax 4 .. Applicant / Appellant

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In the matter between : The Commissioner of Income Tax-4 .. Appellant

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Versus

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Blue Square Corporate Service Pvt. Ltd. .. Respondent

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Mr. Subir Kumar, with Ms. Niyanta Trivedi, Advocate for the Applicant / Appellant.

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CORAM: B. P. COLABAWALLA & AMIT S. JAMSANDEKAR, JJ. DATE: SEPTEMBER 20, 2025

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P. C.

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The above Interim Application is filed to restore the above Appeal to file which was withdrawn by the Appellant – Revenue on 16^th October, 2024.

¶14

On 16^th October, 2024, a statement was made on behalf of the Revenue that it would withdraw the above Appeal in light of the Circular dated 17 September, 2024 issued by the Central Board of Direct Taxes (“CBDT”). It was stated that the disputed tax effect involved in the above Appeal for the

Page 1 of 5

SEPTEMBER 20, 2025

Vina Khadpe,PS

6.os.ia.1075.2025.doc

¶19

Assessment Year 2009-2010 was Rs.1.22 Crores, and hence below the monetary limits as set out in the Circular dated 17^th September, 2024. In this light, and because of the low tax effect involved in the above Appeal, the Appeal was allowed to be withdrawn with liberty to revive the Appeal in the event the tax effect involved was not within the parameters of the Circular dated 17^th September, 2024.

¶20

According to the Revenue, they seek revival of the above Appeal because though the tax effect is below the monetary limits as set out in the CBDT Circular dated 17^th September, 2024, the present case would fall within exception 3.1(h) of the CBDT Circular dated 15^th March, 2024. According to the Revenue, once this is the case, then notwithstanding the low tax effect, the Revenue can proceed to prosecute the above Appeal. It is in this light, they seek restoration of the above Appeal.

¶21

We have heard the learned advocate appearing on behalf of the Appellant – Revenue. It is not in dispute that the tax effect in the present Appeal is below the monetary limits as set out in the CBDT Circular dated 17^th September, 2024. As far as the issue of the exception carved out in the paragraph 3.1(h) of the Circular dated 15^th March, 2024 is concerned, we find that the reliance placed on the said exception is wholly misplaced. It is now

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Page 2 of 5 SEPTEMBER 20, 2025

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Vina Khadpe,PS

¶24

6.os.ia.1075.2025.doc

¶25

well settled by this Court that the exception carved out by the CBDT Circular would apply only prospectively, i.e., from the date of introduction of such exception. In other words, the exception would not apply if they were introduced after the filing of the Appeal. In the facts of the present case, the above Appeal was filed on 2^nd February, 2021. On the other hand, the exception relied upon by the Revenue was brought about only on 15^th March, 2024. In these circumstances, the exception relied upon by the Revenue in the Circular dated 15^th March, 2024 cannot be a justification for prosecuting the above Appeal that was filed on 2^nd February, 2021.

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As mentioned earlier, the aforesaid preposition is well settled by a series of decisions of this Court. One such decision is in the case of Pr. Commissioner of Income Tax - 29 Vs. M/s. Sunraj Industries [Income Tax Appeal No.2263 of 2018 decided on 13^th August, 2025] . The relevant portion of this decision is reproduced hereunder :-

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“4. We have considered the Revenue's contentions. The precedent on this subject/contention of the Revenue, is set out in the case of The Principal Commissioner of Income Tax v/s Premier Industrial Corporation Ltd [(2025) 172 Taxmann.com 289 (Bom)]. Paragraphs 7 and 8 of this decision read thus:-

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"7. The CIT v. V. M. Salgaonkar and Brothers (P) Ltd. [2024] 169 taxmann.com 597 (Bombay), our orders dated 05 February 2025 in Income Tax Appeal No. 643 of 2018 concerning Pr. CIT v. IPL Loan Trust [2025] 171 taxmann.com 725 and connected matters Page 3 of 5

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SEPTEMBER 20, 2025

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Vina Khadpe,PS

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6.os.ia.1075.2025.doc

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and order dated 12 February 2025 in Income Tax Appeal No.1998 of 2018 (Pr. CIT v. Axis AD Print Media (India) Ltd.) and connected appeals hold that the monetary limits prescribed in CBDT Circulars would apply to pending appeals. Still, the exceptions carved out by the CBDT Circulars would apply only prospectively i.e. from the date of the introduction of such exception. 8. Admittedly, before 20 August 2018, these appeals were not covered by any exceptions. However, these appeals were filed because they were beyond the monetary limits prescribe then. The monetary limits have now been revised. These revised monetary limits would also apply to the pending appeals as held in the above precedents. By applying the revised monetary limits to the pending appeals and noting that the exception upon which the Revenue relies was unavailable before 20 August 2018, we uphold the objection on behalf of the assessee and dispose of these two appeals without any cost orders".

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(emphasis supplied)

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5. As can be seen from this reproduction, this Court has time and again held that the monetary limits prescribed in the CBDT Circulars will apply to pending Appeals as well. In other words, for the purposes of the monetary limits, the Circular dated 17th September 2024 would apply to the present Appeal. However, this Court has held time and again that the exceptions carved out by the CBDT Circulars would apply only prospectively and would have no application, if they were introduced after the filing of the Appeal. Admittedly, in the present case, the Appeal was filed on 20th March 2018, while the exception the Revenue relies upon was introduced vide Circular dated 20th August 2018. Hence, the exception relied upon by the Revenue in the Circular dated 20th August 2018 cannot be a justification for prosecuting the above Appeal that was filed on 20th March 2018.”

Page 4 of 5

SEPTEMBER 20, 2025

Vina Khadpe,PS

6.os.ia.1075.2025.doc

¶39

In view of the aforesaid discussion, we find that no case is made out for restoration of the above Appeal, since admittedly the tax effect was below monetary limits set out in the CBDT Circular dated 17^th September, 2024. The above Appeal was correctly withdrawn on 16^th October, 2024.

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The above Interim Application is accordingly dismissed. However, there shall be no order as to costs.

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This order will be digitally signed by the Private Secretary/ Personal Assistant of this Court. All concerned will act on production by fax or email of a digitally signed copy of this order.

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[ AMIT S. JAMSANDEKAR , J.]

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[B. P. COLABAWALLA, J.]

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Page 5 of 5

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SEPTEMBER 20, 2025

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Vina Khadpe,PS

Pr Commissioner of Income Tax 4 v. Blue Square Corporate Service Pvt. Ltd.

Case brief

What is this about?

What did the court decide?

Pr Commissioner of Income Tax 4 v. Blue Square Corporate Service Pvt. Ltd.

Case brief

What is this about?

What did the court decide?

What the court decided

Issues for consideration

Cases cited

Statutes considered

Procedural history

Parties & counsel

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