Appeal to High Court - Section 260A - Income Tax - Ready Reckoner - Income Tax

Appeal to High Court - Section 260A (1) An appeal shall lie to the High Court from every order passed in appeal by the Appellate Tribunal, before the date of establishment of the National Tax Tribunal, if the High Court is satisfied that the case involves a substantial question of law. (2) The Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner or an assessee aggrieved by an order passed by the Appellate Tribunal may file an appeal to the High Court and such appeal shall be- Filed within 120 days from the date on which the order appealed against is received by the Commissioner or the assessee; In the form of a memorandum of appeal precisely stating therein the substantial question of law involved. It should be accompanied by such fee as may be specified in the relevant law relating to court fees for filing appeals to the High Court. Monetary limits for filing of appeal by department before ITAT, High Courts and SLPs/appeals before Supreme Court- S. No. Appeals/SLPs in Income-Tax matters Monetary Limit (₹) 1. Before Appellate Tribunal 50,00,000 2. Before High Court 1,00,00,000 3. Before Supreme Court 2,00,00,000 (2A) Condonation of delay:- The High Court may admit an appeal after the expiry of the period of 120 days referred to in section 260(2)(a) , if it is satisfied that there was sufficient cause for not filing the same within that period. The High court should not dispose of the appeals filed by the department on the ground of delay in a case where huge stakes are involved. The High Court can consider imposing costs on the department for the delay and decide the appears on merit. [ West Bengal Infrastructure Development Finance Corporation Ltd. 2010 (12) TMI 675 - SC ] (3) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question. Note: On question of fact, appeal can be filed upto ITAT. Question of fact cannot be raised in High Court. On substantial question of law an appeal can be filed to the High Court. Substantial question of law is a question of involving interpretation of law. It is a question where there is no fact finding involved but the law has to be interpreted. For example, whether expenditure on roads outside the factory premises is revenue expenditure or not. Only question of law can be raised in High Court. There is also a mixed question of law and facts . This is a question where interpretation of law depends on the fact. The question of fact and question of law are inseparable. For example, whether a particular subsidy is a capital receipt or revenue receipt. The interpretation will depend on the nature of subsidy. i.e., the court can interpret the nature of subsidy to be capital receipt or revenue receipt only after examining the facts for which the subsidy has been given. THE MIXED QUESTION OF LAW AND FACTS IS TREATED AS A SUBSTANTIAL QUESTION OF LAW AND IT CAN BE RAISED IN THE HIGH COURT. The Supreme Court in Santosh Hezariv Purushottam Tiwari 2001 (2) TMI 131 - SC pointed out that 'substantial question of law' has not been defined and inter ali a held that in order that a question may be of general importance, where the matter involced is one in second appeal. The word substantial is qualifying 'question of law' means having substance, essential, real of sound worth, important or considerable. It is to be understood as something in contradiction with technical, of no substance or consequence or academic merely. Appeal against an interim order of Tribunal is not maintainable u/s 260A . However, can question said order on tribunal in an appeal after final order are passed by Tribunal by raising it as a ground in memo of appeal. [ Rajesh Agarwal HUF vs CIT, Ghaziabad and Another 2014 (12) TMI 439 - ALLAHABAD HIGH COURT ] Procedures in hearing appeal: 1. The appeal shall be heard only on the question so formulated, and the respondents shall, at the hearing of the appeal, be allowed to argue that the case does not involve such question However, nothing in this sub-section shall be deemed to take away or abridge the power of the court to hear, for reasons to be recorded, the appeal on any other substantial question of law not formulated by it, if it is satisfied that the case involves such question. 2. The High Court shall decide the question of law so formulated and deliver such judgment thereon containing the grounds on which such decision is founded and may award such cost as it deems fit. At the time of hearing, the High Court can formulate other substantial questions of law not formulated earlier and can hear such questions on reasons to be recorded. [ M/S Indian Additives Ltd. Vs Deputy CIT 2012 (8) TMI 1042 - SC Order] 3. The High Court may determine any issue which- Has not been determined by the Appellate Tribunal; or Has been wrongly determined by the appellate Tribunal, by reason of a decision on such question of law as is referred to in sub-section (1). 4. Save as otherwise provided in this Act, the provisions of the Code of Civil Procedure, 1908, relating to appeals to the High Court shall, as far as may be, apply in the case of appeals under this section. In case a substantial question of law arises, a party cannot be denied to raise the question of law at the time of final hearing even if such question was not framed at the stage of admmission of such appeal. [Ankita Deposits Advances Pvt. Ltd. vs CIT 2010 (6) TMI 379 - Himachal Pradesh High Court ] Note:- As per section 260(6)(b) , High Court can determine any issue on question of law which has been wrongly determined by Tribunal. The court held that a careful reading of section 260(6)(a) will show that the High Court can decide only that question which was raised but not determined by the Tribunal. Therefore, it is necessary that the question sought to be raised before the High Court should have been raised before the Tribunal. However, if a question was raised before the Tribunal but was not determined by the Tribunal then, High Court shall consider such question and deliver its judgment.