Clarification regarding the limitation time for filing of appeals before the CIT(Appeals) under the Income-tax Act,1961 (the Act)
Earlier CBDT issued a circular on dated 30th April 2021 regarding the various Extensions of timelines out of that items one item is regarding to extend the timelines for filing CIT appeals:
They mentioned in Point no. 1 (a) Appeal to Commissioner (Appeals) under Chapter XX of the Income-tax Act, 1961 for which the last date of filing under that Section is 1st April 2021 or thereafter, may be filed within the time provided under that Section or by 31st May 2021 , whichever is later.
Matter is challenged before the Hon’abe M.P. High Court in the case of Palak Agarwal Vs. CBDT & Anr.
1. A Division Bench of M.P. High Court, said that how can CBDT issue Circular No. 8/2021 dated. 30-04-2021 restricting extension of limitation for filing appeal before CIT(A) to 31-05-2021, while the Supreme Court has extended such limitation until further orders till 19.07.2021.
2. How can CBDT fix a time limit restricting the benefits given by Supreme Court.
3. CBDT’s Counsel gave a statement that it shall extend limitation in consonance with Supreme Court’s order.
4. It will take an appropriate decision for extending the period of limitation for filing the appeal.
5. Petitioner was represented by Advocate Milind Sharma.
6. The matter is further listed on 27-05-2021 for response of CBDT.
But before the upcoming hearing of 27th May 2021, On dated 25th May 2021 CBDT issued Circular No. 10/2021 to avoid further litigation on that matter, CBDT further clarified that
1. The Central Board of Direct Taxes has issued Circular No. 8 of 2021 on 30th April 2021 providing various relaxations till 31st May 2021 including extending time for filing the appeals before CIT(Appeals). At the same time, the Hon’ble Supreme Court vide order dated 24th Aprii 2021 in Suo Motu Writ Petition (Civil) NO.3 of 2020 restored the order dated 23rd March, 2020 and in continuation of the order dated order dated 8th March, 2021 directed that the period(s) of limitation, as prescribed under any General or Special Laws in respect of all judicial or quasi-judicial proceedings, whether condonable or not, shall stand extended till further orders.
2. The Central Board of Direct Taxes, clarifies that if different relaxations are available to the taxpayers for a particular compliance, the taxpayer is entitled to the relaxation which is more beneficial to him. Thus, for the purpose of counting the period(s) of limitation for filing of appeals before the CIT (Appeals) under the Act, the taxpayer is entitled to a relaxation which is more beneficial to him and hence the said limitation stands extended till further orders as ordered by the Hon’ble Supreme Court in Suo Motu Writ Petition (Civil) 3 of 2020 vide order dated 27th April 2021.
Now after the clarification from CBDT Appellant have more time for filing the appeal beyond 31st May 2021 until further orders ordered by the Hon’ble Supreme Court in Suo Motu Writ Petition (Civil) 3 of 2020 vide order dated 27th April 2021.
Now if we see that from the Litigation aspect, it will more delayed and drag the litigation because almost after filing an appeal it will take on year for CIT to issue the appeal hearing notice.
Now if further orders of Supreme court comes after 3 to 4 months from 31st May 2021 it will delay further hearing of all the appeal cases and litigation will be more drag.
CBDT should issue the instructions to appeal authority to cut the time between filing of appeal and issuance of hearing notice , they would issue the hearing notice within three months after filing the appeal and dispose of the cases within six months after filing the case.
By these advisable guidelines it helps to Income tax department for made more recovery in these cases.
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