The Income Tax Act 1961 (the Act) provides a hierarchy of income tax appeal before various appellate authorities, from orders passed by lower adjudicatory authorities. Where such right to appeal does apply to an appealable order, the Act requires the same to be made/filed within a prescribed time limit, which varies within the said hierarchy. The failure to do so may result in this precious right being lost and benefits or claims thereunder, but may still be prevented in some of the ways discussed below.
Delay in filing Appeal – Application for Condonation
Failure to so file an appeal within the prescribed time limit does not absolutely deny such right to appeal to the concerned appellant, as the Act itself provides the appellate authorities the power to condone such delay. However such power is not automatically exercised in favour of condoning the delay, the applicant would need to satisfy the concerned appellate authority that there was ‘sufficient cause’ for not presenting such appeal within that period through an Application for ‘Condonation of Delay’ filed along with the Income Tax Appeal documents.
Unclaimed/Unavailed Benefit in Income Tax Return and Delay/Non-Filing of Appeal
The Act contains many provisions that provide different types of benefits (eg.income exemptions, tax reliefs etc.) to Income Tax Assessees. For many Assessees, one or more such benefits may remain unavailed or unclaimed in the relevant Income Tax Return and such an error may arise when the Assessee concerned is unaware of such benefits or how they apply, lack of professional guidance etc. Further, such error may not classify as a ‘mistake apparent from the record ‘, so as to justify a request for ‘Rectification of Mistake’.
In the meantime, the relevant Return may get processed/assessed without such error being detected or pointed out in the ‘Initimation’ or Assessment Order. To make matters worse, when such error is discovered by the Assessee concerned, much time may have been lost and the limited prescribed period for filing an appeal against the relevant assessment order substantially exceeded. It is in such a situation that a Revision Application may be filed under section 264 of the Act, subject to the conditions expressed therein.
Revision of Orders – Application under section 264
Where no such appeal has been filed within the prescribed time and the right to so appeal lost or not exercised, as a possible last resort or less resource consuming alternative to an appeal (assuming any delay in filing the same may potentially be condoned) against an adverse order passed by the income tax authority, the concerned person/assessee could potentially file a Revision Application before the jurisdictional Principal Commissioner/Commissioner, for (non-prejudicial) favorable orders against the said adverse orders, where the same is found legally/factually justified.
- Where such application for revision is made by the assessee, it must be made within 1 year from the date on which the order in question was communicated to him/her/it or the date on which he/she/it otherwise came to know of it, whichever is earlier
- Condonation of Delay – A Revision application may be admitted after the expiry of the 1 year period by the Principal Commissioner/Commissioner, if he/she is satisfied that the assessee was prevented by sufficient cause from making the application within the prescibed 1 year period
- Revision order is required by the Act to be passed within 1 year from the end of the financial year in which such application is made by the assessee for revision
Get Professional Help
To ascertain whether the reasons provided for condonation of delay in filing an Income Tax appeal would or may constitute a ‘sufficient cause’ and whether the facts and circumstances of the concerned assessee legally justifies a ‘Revision’ application, would require professional knowledge and assistance, which is also recommended, if deciding on such course of action.
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