In Brief
The Supreme Court resolved a conflicting interpretation among High Courts on whether Instruction No. 3 of 2011 (raising the monetary ceiling for tax appeals to Rs. 10 lakh) applies to cases already pending when issued. The Court held that the Instruction applies retrospectively to pending appeals, treating it as a beneficial circular that must apply to existing matters consistent with the National Litigation Policy—a government initiative to promote responsible, non-frivolous litigation. However, the Court imposed safeguards: the Department must obtain High Court permission where cases involve constitutional challenges, Board orders, or common principles affecting multiple matters. The Court dismissed the Revenue's appeals while affirming prior three-judge precedent on these terms.
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