Understanding Section 253 of Income Tax Act
The Income Tax Act is a comprehensive law that governs the taxation system in India. Section 253 of the Income Tax Act is a crucial provision that deals with appeals to the Income Tax Appellate Tribunal (ITAT). In this blog, we will discuss the various aspects of Section 253, including its provisions, applicability, and implications.
Provisions of Section 253
Section 253 of the Income Tax Act lays down the provisions for filing an appeal with the ITAT against an order passed by the Commissioner of Income Tax (Appeals) [CIT(A)] or the Principal Commissioner of Income Tax (Appeals) [PCIT(A)]. The ITAT is the second appellate authority in the income tax hierarchy, and its decisions are binding on both the taxpayer and the tax authorities.
The section also provides that any person aggrieved by an order passed by the CIT(A) or the PCIT(A) may file an appeal with the ITAT within a period of 60 days from the date of receipt of the order.
Applicability of Section 253
Section 253 of the Income Tax Act is applicable to all taxpayers who are aggrieved by an order passed by the CIT(A) or the PCIT(A). This section is relevant in situations where the taxpayer is not satisfied with the order passed by the lower appellate authority and wishes to challenge it before the ITAT.
Implications of Section 253
Section 253 has significant implications for taxpayers, as it provides them with an opportunity to challenge the decisions of the CIT(A) or the PCIT(A) before the ITAT. The ITAT is an independent and quasi-judicial body that is empowered to hear and decide on appeals filed by taxpayers. Its decisions are based on the principles of natural justice and are binding on both the taxpayer and the tax authorities.
The ITAT has the power to confirm, modify, or annul the order passed by the CIT(A) or the PCIT(A) and can also issue appropriate directions to the tax authorities. Additionally, the ITAT has the power to remand the case back to the lower appellate authority for fresh adjudication, if required.
Benefits of Section 253
One of the significant benefits of Section 253 is that it provides taxpayers with an additional forum for dispute resolution. The ITAT is an independent authority that is not bound by the decisions of the tax authorities. Therefore, taxpayers have a fair chance of obtaining a favorable decision from the ITAT, even if the tax authorities have rejected their claim earlier.
Another advantage of Section 253 is that it ensures a speedy resolution of disputes. The ITAT is required to dispose of appeals within a reasonable time, and it is not uncommon for appeals to be resolved within a year of being filed. This is beneficial for taxpayers who want to avoid prolonged litigation and want to obtain a final decision on their tax liability as soon as possible.
Appellate process under Section 253
The process of filing an appeal under Section 253 involves the following steps:
- Filing of appeal: The taxpayer has to file an appeal with the ITAT within 60 days of receiving the order passed by the CIT(A) or the PCIT(A).
- Submission of documents: The taxpayer has to submit relevant documents, including the order passed by the CIT(A) or the PCIT(A), along with the appeal.
- Hearing of appeal: The ITAT will conduct a hearing of the appeal and consider the arguments presented by both the taxpayer and the tax authorities.
- Issuing of order: The ITAT will issue an order based on its findings, which will be binding on both the taxpayer and the tax authorities.
Challenges in the Appellate Process under Section 253
Although Section 253 provides an additional forum for dispute resolution, the appellate process can be challenging for taxpayers. One of the primary challenges faced by taxpayers is the complexity of the tax laws and the procedural requirements of the appellate process. Taxpayers are required to submit various documents and comply with procedural requirements, which can be time-consuming and confusing.
Another challenge faced by taxpayers is the limited time frame within which they can file an appeal. Taxpayers have only 60 days to file an appeal from the date of receiving the order passed by the CIT(A) or the PCIT(A). This limited time frame can be challenging for taxpayers who need to gather and submit relevant documents and formulate their legal arguments.
Moreover, the ITAT may require the taxpayer to make a deposit of a certain percentage of the disputed tax liability before the hearing of the appeal. This can be a significant financial burden for taxpayers, especially if the disputed tax liability is high.
Despite these challenges, taxpayers can overcome them by engaging the services of a tax professional who is well-versed in the tax laws and the appellate process. Tax professionals can help taxpayers prepare and submit relevant documents, comply with procedural requirements, and formulate strong legal arguments to support their case.
Conclusion
In conclusion, Section 253 of the Income Tax Act is a vital provision that provides taxpayers with an opportunity to challenge the decisions of the CIT(A) or the PCIT(A) before the ITAT. The ITAT is an independent and quasi-judicial body that is empowered to hear and decide on appeals filed by taxpayers. Therefore, it is essential for taxpayers to be aware of the provisions of Section 253 and to exercise their right to appeal before the ITAT, if required.
Read more useful content:
- section 145 of income tax act
- section 10e of income tax act
- section 9 of the income tax act
- section 94b of income tax act
- section 206aa of income tax act
Frequently Asked Questions (FAQs)
What is Section 253 of the Income Tax Act?
Section 253 of the Income Tax Act provides taxpayers with an additional forum for dispute resolution by enabling them to file an appeal before the Income Tax Appellate Tribunal (ITAT).
Who can file an appeal under Section 253?
Any taxpayer who is aggrieved by an order passed by the Commissioner of Income Tax (Appeals) or the Principal Commissioner of Income Tax (Appeals) can file an appeal before the ITAT under Section 253.
Is there a time limit for filing an appeal under Section 253?
Yes, taxpayers have to file an appeal under Section 253 within 60 days from the date of receiving the order passed by the Commissioner of Income Tax (Appeals) or the Principal Commissioner of Income Tax (Appeals).
What is the jurisdiction of the ITAT?
The ITAT has the power to hear and decide on appeals filed by taxpayers against the orders passed by the Commissioner of Income Tax (Appeals) or the Principal Commissioner of Income Tax (Appeals).
What is the procedure for filing an appeal under Section 253?
Taxpayers have to file an appeal in the prescribed format and submit relevant documents, including the order passed by the Commissioner of Income Tax (Appeals) or the Principal Commissioner of Income Tax (Appeals).
Is there a fee for filing an appeal under Section 253?
Yes, taxpayers have to pay a fee for filing an appeal before the ITAT under Section 253.
Can taxpayers represent themselves before the ITAT?
Yes, taxpayers can represent themselves before the ITAT or engage the services of a tax professional to represent them.
What is the time frame for the ITAT to dispose of appeals?
The ITAT is required to dispose of appeals within a reasonable time, and it is not uncommon for appeals to be resolved within a year of being filed.
Can the ITAT’s decision be challenged in a higher court?
Yes, the decision of the ITAT can be challenged in a higher court, such as the High Court or the Supreme Court.
What are the benefits of filing an appeal before the ITAT under Section 253?
Filing an appeal before the ITAT under Section 253 provides taxpayers with an additional forum for dispute resolution and a fair chance of obtaining a favorable decision from an independent authority. It also ensures a speedy resolution of disputes.
