The Indian taxation system provides a structured mechanism for appeals to ensure fairness and transparency. Section 253 of the Income Tax Act, 1961, outlines the process and conditions under which an assessee or tax authorities can appeal to the Appellate Tribunal. This article provides an overview of the key provisions of this section.
Who Can Appeal to ITAT ?
Under Section 253(1), an assessee who is dissatisfied with certain orders can appeal to the Income Tax Appellate Tribunal. The orders that qualify for appeal include those passed by:
Deputy Commissioner (Appeals) or Commissioner (Appeals): Orders under sections 154, 250, 270A, 271, 271A, 271AAB, 271AAC, 271AAD, 271J, and 272A.
Joint Commissioner (Appeals): Orders under sections 154, 250, 270A, 271, 271A, 271AAC, 271AAD, and 271J.
Assessing Officer: Orders under various provisions, including section 158BC (related to searches under section 132) and section 115VZC.
Principal Commissioner or Commissioner: Orders under sections 12AA, 12AB, 80G(5)(vi), 263, 270A, 271, 272A, and amendments to such orders under section 154.
Principal Chief Commissioner, Chief Commissioner, Principal Director General, or Director General: Orders under sections 263 and 272A, including amendments under section 154.
Prescribed Authority: Orders under section 10(23C).
Appeal by the Tax Authorities to ITAT ?
Section 253(2) allows the Principal Commissioner or Commissioner to direct the Assessing Officer to file an appeal against an order passed by the Deputy Commissioner (Appeals), Joint Commissioner (Appeals), or Commissioner (Appeals) under sections 154 or 250.
Time Limits for Filing ITAT Appeals
Appeals under subsection (1) or (2) must be filed within 60 days from the date the order is communicated.
Appeals related to orders under section 158BC must be filed within 30 days.
A memorandum of cross-objections can be filed within 30 days of receiving the notice of appeal.
Late Filing of Appeals
The Appellate Tribunal may allow the filing of an appeal or memorandum of cross-objections even after the expiration of the prescribed period if sufficient cause for the delay is provided.
ITAT Appeal Fees
The fees for filing an appeal vary based on the total assessed income:
Income up to ₹1,00,000: ₹500
Income between ₹1,00,000 and ₹2,00,000: ₹1,500
Income above ₹2,00,000: 1% of assessed income (maximum ₹10,000)
Other matters: ₹500
Stay of demand application: ₹500
Government's Role in Appeal Mechanism
The Central Government can introduce schemes to improve the efficiency, transparency, and accountability of appeals by:
Optimizing resource utilization.
Establishing team-based mechanisms with dynamic jurisdiction.
It can also issue notifications to modify provisions for implementing such schemes, with a final deadline of March 31, 2024, for issuing such directives.
Note: Finance bill 2025 has omitted the deadline of March 31, 2024.
Final words
Section 253 of the Income Tax Act, 1961, plays a crucial role in ensuring that taxpayers and authorities have a fair opportunity to challenge decisions. Understanding the appeal process, fees, and timelines can help taxpayers navigate the system effectively and safeguard their interests.
About the Author
CA Bhuvnesh Kumar Goyal
Fellow Chartered Accountant, LLB, B.com, Forensic Accountant and Fraud Detection Professional
CA Bhunvesh Kumar Goyal, a seasoned Chartered Accountant with 15+ years of experience, specializes in Income Tax, GST, MSME advisory, startups, audits, company registration, and business structuring. He also provides expert guidance on ESG, BRSR, the Companies Act, crypto transactions, and transfer pricing. With a practical approach, he helps businesses stay compliant while optimizing financial and operational efficiency.