First Appeal to Commissioner (Appeals) (Section 246A)

Who can appeal

An assessee who is aggrieved by an order passed by the Assessing Officer (AO) may file an appeal before the Commissioner (Appeals).

Time limit for filing appeal

The appeal must be filed within 30 days from the date of receipt of the assessment order or demand notice. The Commissioner (Appeals) may condone delay if sufficient cause is shown.

Second Appeal to Appellate Tribunal (Section 253)

Who can appeal

Either the assessee or the Income Tax Department can file an appeal against the order of the Commissioner (Appeals) before the Income Tax Appellate Tribunal (ITAT).

Grounds for appeal (questions of law)

The appeal may be filed on grounds involving a question of fact, a question of law, or a mixed question. ITAT is the final fact-finding authority.

Appeal to High Court (Section 260A)

Substantial question of law

An appeal to the High Court can be filed only if the case involves a substantial question of law. Either the assessee or the department may file the appeal within 120 days of the ITAT order.

The High Court may admit the appeal only if it is satisfied that the question raised is significant in interpreting the provisions of the Income Tax Act.

Appeal to Supreme Court (Section 261)

An appeal lies to the Supreme Court against the judgment of the High Court, only if the High Court certifies that the case involves a question of law of general importance and that it is fit to be decided by the Supreme Court.

Alternatively, special leave to appeal can also be sought directly under Article 136 of the Constitution.

Revision by Commissioner (Section 263)

Power to revise orders prejudicial to revenue

Under Section 263, the Commissioner has the power to revise any order passed by the Assessing Officer if it is considered:

• Erroneous, and
• Prejudicial to the interests of the revenue.

Such revision can be made suo motu by the Commissioner within a period of 2 years from the end of the financial year in which the order was passed.

Revision by Principal Commissioner/Commissioner (Section 264)

Power to revise orders on application of assessee

Under Section 264, the assessee may file an application to the Principal Commissioner or Commissioner to revise any order passed by the Assessing Officer.

The Commissioner may also suo motu revise the order if it is in the interest of justice.

The application must be filed within 1 year from the date on which the order is communicated to the assessee. However, the Commissioner has the power to condone the delay if sufficient cause is shown.

The revision under this section can be made even if the order is not erroneous or prejudicial to the revenue.