P.D. Dinakaran, J. - (1.)THESE appeals are filed by the Revenue under Section 260-A of the Income-tax Act, 1961 (hereinafter referred to as 'the Act') against the common order of Income-tax Appellate Tribunal in ITA.Nos.36,40 & 41 (Mds)/2004 dated 13.5.2004, raising the following substantial questions of law:
1. Whether on facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in confirming the order of the CIT (Appeals) deleting the additions and dismissing the appeal filed by the Revenue without considering the fact that the appeal in the assessee's case was intrinsically linked with those fo the other assessees of this group in the light of the facts discussed and directions given for making some further enquiries and make a fresh assessment by the Appellate Tribunal's consolidated appellate order relating to all the assessees of this group for the assessment year 1992-93?

(2.)WHETHER on facts and in the circumstances of the case, the Income-tax Appellate Tribunal was right in dismissing the appeal filed by the Revenue without going into the merits of the case on the ground that the tax effect was less than the monetary limit of Rs.1,00,000/- prescribed by the Central Board of Direct Taxes in the Instruction No.1979 dated 27.3.2000 for filing appeals before the Income-tax Appellate Tribunal without considering the intent and purpose of the subsequent Instruction No.1985 dated 29.6.2000 and without considering the judicial pronouncements of various High Courts including that of the jurisdictional High Court wherein it has been held that the Board's instructions regarding monetary limits do not operate as an embargo on considering the appeals on merits?
2. The brief facts giving rise to the above appeals are as under:- (a) The assessees were connected with the concern, by name, Vazhaga Vaiyagam Enterprises where a search was conducted on 19.8.1991, followed by a survey. In the course of assessment for the assessment year 1992-93 it was found that the assessees and their colleagues had made deposits and since there was no explanation as to the source of money, the deposits were assessed as unexplained investment at the hands of various assessees. (b) The assessments giving rise to the above appeals relate to the interest that accrued in favour of assessees from the deposits with banks which had been treated as unexplained for earlier assessment years. (c) The Commissioner of Income-tax (Appeals), on appeal, deleted the additions made. Aggrieved by the order of the Commissioner of Income-tax (Appeals), the Revenue filed appeals before the Income-tax Appellate Tribunal, which, relying on the decision of this Court in CWT v. Annamalai (258 ITR 678), held that as per the Circular of the Central Board of Direct Taxes (CBDT) dated 27.3.2000, the monetary limit for filing appeal to the Tribunal was Rs.1,00,000/- and since the tax effect for the assessment years in question was less than Rs.1 lakh, dismissed the appeals. Aggrieved by the same, the Revenue has come forward with these appeals raising the questions above mentioned.

Learned counsel appearing for the Revenue has fairly brought to our notice the decision of this Court reported in 275 ITR 244 (C.I.T. v. Kodanand Tea Estates Co.) wherein the Division Bench, in which one of us was a party (P.D.DINAKARAN,J.), after referring to the Board Instruction No. 1979, dated March 27, 2000, held as under:-

"The instruction came into force only with effect from April 1, 2000. The assessment years involved in these appeals are earlier to the date from which the notification was given effect to. Hence, the application of notification for dismissing the appeal cannot be legally sustainable. Apart from that, clause (ii) of para. 3 of Instruction No. 1979 provides that where the Board's order, notification, instruction or circular is the subject-matter of an adverse order irrespective of the revenue effect, the appeal has to be decided on the merits. When the applicability of the notification, which is given effect to from April 1, 2000, is questioned before the Tribunal, the question comes from clause (ii) of paragraph 3 of Instruction No. 1979." For the above two reasons, we are of the view that the Tribunal has committed a mistake in not considering the issue on the merits and dismissing the appeal on the basis of the notification. Accordingly, the orders of the Tribunal, which are impugned in these appeals are set aside and the matters are remanded back to the Tribunal to do the exercise on the merits once again."

Applying the ratio laid down by this Court in the judgment cited supra to the case on hand, we set aside the orders of the Appellate Tribunal and remit the matters back to the Appellate Tribunal with a direction to decide the same on merits and in accordance with law, after giving an opportunity to the assessees, who are at liberty to agitate all the points available to them. In this view of the matter, the questions of law raised in the appeals are answered in favour of the Revenue and against the assessees. The appeals are disposed of accordingly. No costs. Connected TC.M.P.Nos.209 & 210 of 2005 are closed.