Govt. To Withdraw 41% Direct Tax Cases & 18% Indirect Tax Cases

In an attempt to reduce tax litigations, the Government has decided to increase the threshold monetary limits for filing Departmental Appeals at various levels.

Harping on the expected benefits of the move, an official release states, “This is a major step in the direction of litigation management of both direct and indirect taxes as it will effectively reduce minor litigations and help the Department to focus on high-value litigations.”

Besides, the Government has also decided to withdraw 41% cases indirect taxes and 18% in indirect taxes from various courts as well. Elaborating on the withdrawals, the release says, “In case of CBDT, out of total cases filed by the Department in ITAT, 34% of cases will be withdrawn. In the case of High Courts, 48% of cases will be withdrawn and in the case of Supreme Court, 54% of cases will be withdrawn. The total percentage of reduction of litigation from the Department’s side will get reduced by 41%…

…Similarly, in case of CBIC, out of total cases filed by the Department in CESTAT, 16% of cases will be withdrawn. In case of High Courts, 22% of cases will be withdrawn and in case of Supreme Court, 21% of cases will be withdrawn. The total percentage of reduction of litigation from the Department’s side will get reduced by 18%.”

It, however, clarifies that the withdrawal would not be effected in cases involving substantial points of law.