While filing the return, somehow we all pray that our return does not get selected for the scrutiny. As because we all know that once tax demand is raised by the AO and if we go for appeal against the said order then case may stuck for many long years. Therefore, small taxpayers avoid appeals as even if they go for appeal they will have to deposit the tax until the date of final judgment.   

To deal with such issues, CBDT has issued an Instruction dated 19th June 2015 directing that all Commissioner of Income Tax (Appeals) should issue appellate orders within 15 days of the last hearing. It is stated that this directive shall also be applicable to orders passed by the CIT (Administration)/ CCIT as regards matters within their purview under varied Sections of Income Tax Act such as Sections 80G, 264, 263 or Orders under Rule 86 of Second Schedule and under other allied direct taxes. The CBDT has directed all officers to ensure strict compliance of the directive and has warned that any lapse on this account shall be viewed adversely.

To analyze the above instruction properly, we shall understand the situation in which we can file the appeal and what is the hierarchy which shall be followed in such cases.

Whenever taxpayers are aggrieved by an order of the Assessing Officer, they can file an appeal against the order of the Assessing Officer before the Commissioner of Income-tax (Appeals). Section 246A specifies the orders against which an appeal can be filed before the CIT (A). It is to be noted that CIT (A) is the first appellate authority.

The list of few major orders against which an appeal can be preferred before the CIT (A) is given below:

• 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)/ 200A(1)
• Assessment order passed under section 143(3)/ 144/ 147 etc.

Such appeal shall be filed within 30 days of specified date. The CIT (A) may admit belated application on sufficient cause being shown. Before filing the appeal, the taxpayer shall pay the tax determined as per the return of income filed by him. If no return of income is filed, the taxpayer shall pay tax equal to the amount of advance tax payable by him.

After the order of CIT(A), if either party is aggrieved by the order then appeal may be preferred to the Tribunal. Such appeal can arise on points of law or facts or both.

An appeal may be filed with the High Court only if the case involves substantial question of law within 120 days of receipt of order. However, only Commissioner or an assessee aggrieved by the order of Tribunal can appeal to the HC.

After the order of HC, if, parties to order feel aggrieved then appeal lies with the Supreme Court from any judgment of High Court. However, the High Court must certify the appeal to be fit for presenting in the Supreme Court. The decision of Supreme Court shall be final and binding. Such appeal shall be filed within 90 days of service of judgment.

As we can see that there is a long process for an appeal to reach its final judgment and at each level a case remains pending for years and years. There may be lakhs of cases which are pending from 10-15 years waiting for its final judgment. It is to be noted that before making appeal against an order, appellant need to pay the tax demand raised by AO. In such situation, there is a hardship on the appellant wherein he has to deposit the tax demand raised irrespective of the fact that such demand is valid or not. Moreover, such tax remains deposited till the date of final judgment which may extend to unknown period.

With such instruction in force, atleast at the first appellate authority their cases shall now not be unnecessarily extended. Undoubtedly, like such instructions, are needed on urgent basis that shall be applicable on whole hierarchy level to provide relief to appellant. Taxpayers are looking hopefully towards the Government to remove such hardship from them.

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