The CBDT circulars did not apply retrospectively to pending appeals, and a special order from the CBDT was required for appeals to be filed on merits in cases involving organized tax evasion activity.

JUDGMENT

R.D. Dhanuka, J. - By these appeals filed under section 260A of the Income Tax Act, 1961, (hereinafter referred to as 'IT Act' for short), the appellants have impugned the orders passed by the Income Tax Appellant Tribunal, Pune, Bench 'B' in this bunch of appeals for various assessment years.

2. By consent of parties, all these bunch of appeals were heard together and are being disposed of by common order. The learned counsel for the parties jointly stated that the order that would be passed in ITA No.19/2013 would apply to the rest of the appeals which were heard together. The statement is accepted. We are, thus, dealing with the facts and submissions made by the parties in ITA No.19/2013.

3. It is the case of the appellant that on 17th March 2006 the search action in case of Peety Group of Jalna was conducted by the Income Tax Department. The respondent-assessee is one of the family member of the said group. It is the case of the appellant that during the search action, certain statements of the share brokers were recorded by the investigation wing of the department at Mumbai wherein they had admitted that they had issued bogus 'broker notes' and bills to the number of persons to ante-date purchases including the members of Petty Group of Jalna to generate bogus Long term Capital Gain and Short Term Capital Loss. It is the case of the appellant that the respondent-assessee voluntarily declared the amount shown as long term capital gain and short term capital loss as bogus and had voluntarily stated that they will pay the taxes on the admitted amount on 17th March 2006. However, while filing the return, they retracted from the statement made under section 132 (4) of the IT Act. On 31st December 2007 the Assessing Officer held that the claim of long term capital gain and short term capital loss are bogus and made addition of the amounts to the taxable income of the respondent-assessee.

4. The respondent-assessee preferred appeal before the Commissioner of Income Tax (Appeals), Aurangabad (hereinafter referred to as 'CIT (A) Aurangabad' for short). By order dated 24th June 2008 the CIT (A) allowed the said appeal filed by the respondent- assessee. Being aggrieved by the order passed by the CIT (A), the appellant preferred appeal before the Income Tax Appellate Tribunal, Pune Bench 'B' (hereinafter referred to as 'ITAT' for short) for the assessment year 2005-06. By judgment and order dated 28th September 2012, ITAT dismissed the said appeal preferred by the appellant. Being aggrieved by the said order, the appellant preferred this Income Tax Appeal under section 260-A of the IT Act.

5. By order dated 10th March 2014 passed by this Court, ITA No. 19/2013 was admitted on the following substantial questions of law.

(i) Whether the additions made by the AO u/s. 69A to the taxable income of assessee, is just and proper ?

(ii) Whether the sale proceeds from the transaction of shares amounts to LTGC and STGC when the assessee himself had voluntarily admitted to pay the taxes on the additional income ?

6. Mr. R.S. Padvekar, learned counsel for respondent-assessee in this bunch of appeals raised the issue of maintainability of these appeals on the ground that the tax effect in these appeals is less than the monetary limit of Rs. 50 lakh prescribed under the Circular No. 3/2018 dated 11th July 2018 issued by the Government of India, Ministry of Finance, Department of Revenue, Central Board Direct Taxes (hereinafter referred as 'CBDT' for short) insofar as appeals before the High Court is concerned.

7. The learned counsel for respondent-assessee placed reliance on the said Circular No.3/2018 issued by the CBDT in supersession of the Board Circular dated 21/2015 dated 10th December 2015 and would submit that since the tax effect in these appeals did not exceed monetary limit of Rs.50 lakh, the appellant cannot proceed with this bunch