What can be done when there is a delay in filing the case before an income tax tribunal?

What can be done when there is a delay in filing the case before an income tax tribunal?

The Income Tax Appellate Tribunal (hereinafter referred as ITAT), constituted by the Central Government under the Ministry of Law, stands as the first experiment on ‘tribunalization’ in the Indian history. First set up on 25th January 1941. It is the second appellate authority after exhausting your remedy before the Commissioner of Income Tax (CIT) and Principal Commissioner of Income Tax (PCIT). Appeal to the ITAT can be filed by any of the aggrieved party; either by the taxpayer or by the Assessing Officer. The Tribunal consists of two classes of members: Judicial and Accountant. It is established by law that the Tribunal must entertain a legitimate claim.[i]

Filing of case before the CIT

The most preliminary stage lies in filing the case before the CIT upon being aggrieved by the order of the Assessing Officer. The CIT is the first appellate authority in the entire due process.

Section 246A specifies the orders against which the cause of action may arise. Few of them are:

  • Order passed against the taxpayer in a case where the taxpayer denies the liability to be assessed under Income Tax Act.
  • Intimation issued under section 143(1)/(1B) where adjustments have been made in income offered to tax in the return of income.
  • Intimation issued under section 200A(1) where adjustments are made in the filed statement.
  • Assessment order passed under section 143(3) except in case of an order passed in pursuance of directions of the Dispute Resolution Panel
  • An assessment order passed under section 144.
  • Order of Assessment, Re-assessment or Re-computation passed after reopening the assessment under section 147except an order passed in pursuance of directions of the Dispute Resolution Panel
  • Order passed under section 171 recording the finding about partition of a Hindu Undivided Family.

Section 249(2) enlists that such case must be filed within thirty days of the Assessing Officer’s order.

  1. Where the appeal relates to any assessment or penalty, the date of service of notice of demand relating to the assessment or penalty.
  2. Where appeal is under section 248, i.e., appeal by a person denying liability to deduct tax under section 195, the date of payment of tax.
  3. In any other case, the date on which intimation of the order sought to be appealed against is served.

The CIT only admits belated application on sufficient grounds being shown/proved. Application for condonation of delay in filing, giving the reasons for the delay, along with necessary evidences should be filed with Form No. 35. The CIT can condone the delay in filing only if genuine reason exists for delay.

The due process of Appeal

A taxpayer can file an appeal to the ITAT, challenging the orders of the CIT or the PCIT. In fact, if the PCIT objects to the order passed by the CIT, he may direct the Assessing Officer to appeal to the ITAT against the orders of the CIT, which is infamously called as ‘departmental appeal’ i.e., the Income-Tax department moving to ITAT against the order of the its own branch. The departmental appeal shall be allowed only in cases where tax effect involved in the appeal exceeds Rs. 10,00,000. In case where a composite order or judgment involves more than one taxpayer, each taxpayer is dealt separately.

Form and signature

The Act prescribes a stratified procedure for filing an appeal.  The appeal to ITAT shall be filed in Form No. 36. The Form of Appeal has to be signed by a couple of individuals, who are authorised to sign the Return of Income under Section 140, for verification:

  1. In case of appeal by the individual taxpayer, he himself or by a person duly authorised by him who is holding a valid power of attorney
  2. In case of a Hindu Undivided Family, by the Karta of the family or if Karta is absent from India or is not capable for signing, by any other adult member of such family.
  3. In case of a company, by the Managing Director or if Managing Director is not available or where there is no Managing Director by any director of the company.
  4. In case of a firm, by the Managing Partner or if Managing Partner is not available or where there is no Managing Partner by any partner (not being a minor)
  5. In case of a LLP, by the Designated Partner or if Designated Partner is not available or where there is no Designated Partner by any partner.
  6. In case of a Local Authority, by the Principal Officer thereof
  7. In case of a Political Party, by the Chief Executive Officer of such party
  8. In case of any other Association, by the Principal Officer thereof or by any member of the Association.
  9. In case of any other Person, by that Person or by some person competent to act on his behalf.

Fees for filing the Appeal

Where assessed income is:
up to Rs. 1,00,000Rs. 500
more than Rs. 1,00,000, but up to Rs. 2,00,000Rs. 1,500
more than Rs. 2,00,0001% of assessed income

Order of the ITAT

The members of bench (comprising of one judicial and one Accountant) of the ITAT hear the appeal. After hearing the Appeal, the ITAT pronounces its order and communicates the same to the taxpayer as well as the Assessing Officer. Appeals where total income computed by the Assessing Officer does not exceed Rs. 50 lakhs may be disposed of by single member Bench.

If the members of the Bench differ in opinion on any point, the decision is taken on the basis of majority. If members are equally divided in their opinion, the points of difference are stated by each member and the case is referred by the President of the ITAT for hearing such points by one or more of other members of the ITAT.

Rectification of Appellate Order

The ITAT may, at any time within six months period from the end of the month in which the order was passed, rectify any mistake apparent from record, amend any order passed by it if the mistake is brought to its notice by the taxpayer or Assessing Officer.

However, where such amendment has the effect of enhancing an assessment or reducing a refund or otherwise increasing a liability of the taxpayer, it shall not be made unless the Appellate Tribunal has given a notice to the taxpayer of its intention to do so and has allowed the taxpayer for a reasonable opportunity.

Time- limit for Appealing/ Limitation for Appeals

Appeal to ITAT can be filed in Form 36/36B within a period of sixty days from the date on which order sought to be appealed against is communicated to the taxpayer or to the CIT or PCIT (as the case may be) [ii] against orders prescribed in Section 253 of the Act. Additional grounds can be questioned and appealed for the first time, not arising from the order of lower authorities in a cross objection.[iii]

The ITAT may admit an appeal even after the period of 60 days if it is satisfied that there was sufficient cause for not presenting the appeal within the prescribed time. The expression ‘sufficient cause’ employed by the Legislature is quite elastic which enables the Courts to apply law in a meaningful manner. The aim is to sub serves the ends of justice and dispose the matters on merits.[iv]

There is a substantial pendency of appeals of the Income Tax Department before various appellate fora. The CBDT is aware of the importance of litigation management and has been continuously working towards achieving the same.

On 11th July, 2018, the Department came up with a revised monetary limit for filing Departmental appeals before various appellate fora including ITAT, High Courts & Supreme Court have been revised as under:

Appellate ForumExisting Monetary Limit (Rs.)Revised Monetary Limit (Rs.)
Before ITAT20,00,00050,00,000
Before High Courts50,00,0001,00,00,000
Before Supreme Court1,00,00,0002,00,00,000

“The views of the authors are personal


[i] CIT v. Bharat General Reinsurance Co. Ltd, 81 ITR 303 (Del).

[ii] Jute Corporation of India Ltd. V. CIT, 187 ITR 688 (SC)

[iii] PCIT v. Silver Line, 383 ITR 455 (Del.)

[iv] CIT (Addl) v. Prem Kumar Rastogi (1978) 115 ITR 503 (All.)

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