Ministry of Finance
Department of Revenue
Central Board of Excise & Customs
New Delhi 17th August 2011
INSTRUCTION
To,
1. All Chief Commissioners and Directors General under the Central Board of
Excise and Customs.
2. CDR, Customs, Excise & Service Tax Appellate Tribunal.
3. All Commissioners of Customs/Central Excise/Service Tax/All Joint Chief
Departmental Representatives/Commissioner, Directorate of Legal Affairs.
4. <[email protected]>
Sub:- Reduction of Government litigation -
providing monetary limits for filing appeals by the Department before
CESTAT/High Courts and Supreme court - Regarding
In exercise of the powers conferred by Section 35R of the Central Excise Act,
1944 made applicable to Service Tax vide Section 83 of the Finance Act,1994 and
Section 131BA of the Customs Act, 1962 the Central Board of Excise & Customs
(hereinafter referred to as the Board) fixes the following monetary limits below
which appeal shall not be filed in the Tribunal, High Court and the Supreme
Court:
| Sl.No. |
Appellate Forum |
Monetary limit |
| 1. |
CESTAT |
Rs.5,00,000/- |
| 2. |
HIGH COURTS |
Rs.10,00,000/- |
| 3. |
SUPREME COURT |
Rs.25,00,000/- |
2. For ascertaining whether a matter would be covered within or without the
aforementioned limits, the determinative element would be duty/tax under
dispute. To illustrate it further in a case involving duty of Rs. 5 lakhs or
below with equal penalty and interest, as the case may be, no appeal shall be
filed in the Tribunal. Similarly, no appeal shall be filed in the High Courts if
the duty involved does not exceed Rs.10 lakhs with or without penalty and
interest. Further, the Commissionerates shall not send proposal to the Board for
filing Civil Appeal or Special Leave Petition in the Supreme Court in a case
involving duty up to Rs.25 lakhs, whether with penalty and interest or
otherwise. However, where the imposition of penalty is the subject matter of
dispute and the said penalty exceeds the limit prescribed, then the matter could
be litigated further. Similarly, where the subject matter of dispute is the
demand of interest and the amount of interest exceeds the prescribed limit, then
the matter may require further litigation.
3. Adverse judgments relating to the following should be contested irrespective
of the amount involved:
a) Where the constitutional validity of the provisions of an Act or Rule is
under challenge.
b) Where Notification/ Instruction/ Order or Circular has been held illegal or
ultra vires
4. Several queries connected with application of monetary limits have been
raised by the field formations which were considered by the Board and are being
clarified as below:-
| Issues |
Clarifications |
| a) Whether duty involved mentioned in the Instruction
dated 20.10.2010 refers to duty outstanding to be collected or the total
duty demanded for deciding the threshold limit prescribed therein.
|
In a case where a part of the duty demanded is not
disputed and is paid and the outstanding duty under dispute is less than
the monetary limit prescribed by the Board, no appeal shall be filed. In
other words, monetary limit shall apply on the disputed duty and not on
the total duty demanded in a case. |
| b) Whether monetary limits would apply to cases of
refund. |
It is clarified that the monetary limits being
prescribed by the Board would apply to cases of refund as well. |
| c) Whether applications being filed by the Department
before office of Joint Secretary (Revision Application) would also be
covered under the stipulation of monetary limits. |
The limit specified herein will not be applicable to
application filed before the Joint Secretary (Revision Application). |
| d) Whether exclusion of audit objections mentioned in para
6(c) of Instruction dated 20.10.2010 would cover internal audit
objection cases also or whether they would be limited to cases of
revenue audit alone. |
The intention was to apply the exclusion clause
mentioned at para 6(c) only to
disputes arising out of revenue audit objections accepted by the Department. It
has now been decided to delete the said exclusion clause (refer para 3 of this
Instruction). Therefore, in all cases of audit objections accepted by the
Department, while protective demands may continue to be issued but the same
would be subjected to the monetary limits for filing appeal in the Tribunal,
High Courts and the Supreme Court. |
5. The revised monetary limits shall come into force from 1.9.2011.
6. This Instruction is in continuation of earlier Instruction of even number
dated 20.10.2010 and seeks to revise the monetary limits, exclusion clauses and
clarifies the doubts raised by the field formations on this issue./p>
(Sunil K. Sinha )
Director (R)
26162156
F.No.390/Misc./163/2010-JC