WHEN APPEAL CAN BE FILED BEFORE COMMISSIONER (APPEALS)

When a tax payer is adversely affected by Orders as under passed by various Income tax authorities:

  • 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 147 except an order passed in pursuance of directions of the Dispute Resolution Panel An order referred to in section 150.
  • An order of assessment or reassessment passed under section 153A or under section 158BC in case of search/seizure.
  • Order made under section 92CD(3).
  • Rectification order passed under section 154 or under section 155.
  • Order passed under section 163 treating the taxpayer as agent of non-resident.
  • Order passed under section 170(2)/(3) assessing the successor of the business in respect of income earned by the predecessor.
  • Order passed under section 171 recording the finding about partition of a Hindu Undivided Family.
  • Order passed by Joint Commissioner under section 115VP(3) refusing approval to opt for tonnage-tax scheme to qualifying shipping companies.
  • Order passed under section 201(1)/206C(6A) deeming person responsible for deduction of tax at source as assessee-in-default due to failure to deduct tax at source or to collect tax at source or to pay the same to the credit of the Government.
  • Order determining refund passed under section 237.
  • Order imposing penalty under section(s) 221 / 271 / 271A / 271AAA /271F / 271FB / 272A / 272AA / 272B/ 272BB/ 275(1A)/ 158B FA(2) / 271B / 271BB / 271C / 271CA / 271D / 271E / 271AAB.
  • Order imposing a penalty under Chapter XXI

TIME LIMIT FOR PRESENTING AN APPEAL

  • Within 30 days from the date of service of notice of demand relating to assessment or penalty order.
  • The Commissioner (Appeals) may admit an appeal after the expiration of period of 30 days, if he is satisfied that there was sufficient cause for not presenting the appeal within the period of 30 days.

PAYMENT OF ACCEPTED TAX LIABILITY MUST BEFORE FILING APPEAL

An appeal will be admitted by Commissioner (Appeals) only if tax as per the returned income has been paid prior to filing of appeal

If no return of income is filed, the taxpayer should pay tax equal to the amount of advance tax payable by him. However, on application made by the taxpayer, the Commissioner of Income-tax (Appeal) may exempt the taxpayer from payment of tax before filing the appeal. Such benefit is granted if good and sufficient reason is proved by the taxpayer for non-payment of tax before filing the appeal.

FORM OF APPEAL

Form No. 35 – Containing details of “Relief claimed in appeal” , “Statement of Facts”, “Grounds of appeal”

Signed and verified by the individual tax payer himself or by a person duly authorised by him holding valid power of attorney

APPEAL FEES :

If Total Income determined:

Less than Rs. 1,00,000/- – Rs. 250

More than Rs.1,00,000/- but less than Rs.2,00,000/ – Rs 500

More than Rs. 2,00,000/ – Rs. 1000

Where subject-matter of appeal is not covered under any of the above – Rs. 250

DOCUMENTS TO BE SUBMITTED FOR APPEAL

  • Form No. 35 (including statement of facts and grounds of Appeal) – in duplicate. However, e-filing has been made mandatory for persons for whom e-filing of return of income is mandatory w.e.f 1/3/2016.
  • One certified copy of order, appealed against.
  • Notice of demand in original.
  • Copy of challans of fees the details of the challan (i.e., BSR code, date of payment of fee, serial number and amount of fee) are required to be furnished in case of e-filing of form of appeal.

PROCEDURE OF THE APPEAL

  • After the receipt of Form no. 35, the Commissioner of Income-tax (Appeals) will fix the date and place for hearing the appeal.
  • The date and place will be communicated to the taxpayer and to the Assessing Officer against whose order appeal is preferred. The communication will be made by issuing a notice to both the parties.
  • In the appeal proceedings the taxpayer or the Assessing Officer can either appear personally or can appear through an authorized representative.
  • The Commissioner of Income-tax (Appeals) would hear the appeal and may adjourn the appeal from time-to-time.
  • Before passing the order, the Commissioner of Income-tax (Appeal) may make such further inquiries as he thinks fit, or may direct the Assessing Officer to make further inquiry and report the result to him.
  • During the course of appeal, the Commissioner of Income-tax (Appeals) may allow the taxpayer to go into additional grounds of appeal * However, additional grounds will be accepted only if the Commissioner of Income-tax (Appeals) is satisfied that omission of these grounds from the form of appeal was not willful or unreasonable. (*) Additional grounds means grounds which are not specified in Form no. 35

FILING OF ADDITIONAL EVIDENCES

During the appeal proceedings before the Commissioner of Income-tax (Appeals), the taxpayer is permitted to produce only those evidences (whether oral or documentary) which were produced by him before the Assessing Officer. In other words, the Commissioner of Income-tax (Appeals) will not permit the taxpayer to produce any additional evidences which were not produced by him before the Assessing Officer.

However, in following circumstances additional evidence will be accepted by the Commissioner of Income-tax (Appeals)

(a) Where the Assessing Officer has refused to admit evidence which ought to have been admitted; or

(b) Where the appellant was prevented by sufficient cause from producing the evidence which he was called upon to be produced by the Assessing Officer; or

(c) Where the appellant was prevented by sufficient cause from producing any
evidence before the Assessing Officer which is relevant to any ground of appeal;
or
(d) Where the Assessing Officer has made the order appealed against without giving
sufficient opportunity to the appellant to adduce evidence relevant to any ground
of appeal.

  • Normally, the taxpayer has to make an application for acceptance of additional evidences. In other words, the additional evidences are to be accompanied with an application stating the reasons for their admission.
  • On receipt of such an application, the Commissioner of Income-tax (Appeals) may admit the same after recording reasons in writing for the admission of these evidences.
  • Before taking into account the additional evidence filed by the taxpayer, the Commissioner of Income-tax (Appeals) has to provide a reasonable opportunity to the Assessing Officer for examining the additional evidence or the witness, as well as to produce evidences to rebut additional evidences produced by the taxpayer.

DECISION OF THE COMMISSIONER OF INCOME-TAX (APPEALS)

  • After hearing the case/arguments, the Commissioner of Income-tax (Appeals) will pass his order. The order will be in writing. The order will be passed for disposal of the appeal and will state the decision on each ground of appeal along with reasons.
  • In case of an appeal against the assessment order the Commissioner of Income-tax (Appeals) may confirm, reduce, enhance or annul the assessment (including assessment in respect of which proceedings before the Settlement Commission abates).
  • In case of an appeal against the penalty order the Commissioner of Income-tax (Appeals) may confirm, reduce or enhance the penalty.
  • Before enhancing any assessment or penalty, the Commissioner of Income-tax (Appeals) has to provide a reasonable opportunity to the taxpayer to present his case against such enhancement.
  • While disposing of an appeal, the Commissioner of Income-tax (Appeals) may consider and decide any matter arising out of the proceedings in which order appealed against was passed, even if such matter was not raised by the taxpayer before the Commissioner of Income-tax (Appeals).