Special Provision for Avoiding Repetitive Appeals [Section 158A & Rule 16]

Section 158A of the Income Tax Act, 1961, read with Rule 16 of the Income Tax Rules, 1962, provides a special provision for avoiding repetitive appeals by an assessee when an identical question of law is pending before a higher appellate authority (High Court or Supreme Court). This provision aims to reduce repetitive litigation, save time, and streamline the appellate process. Below is a detailed overview:

Key Provisions of Section 158A

1. Objective:
   • Section 158A allows an assessee to avoid filing repetitive appeals on an identical question of law that is already pending before the High Court or Supreme Court in another proceeding involving the same assessee, thereby reducing litigation and administrative burden.

2. Conditions for Applicability:

• • The assessee must claim that the question of law arising in their case (e.g., in an appeal before the Commissioner (Appeals) or ITAT) is identical to a question of law pending before:
    • The High Court under Section 260A (appeal from ITAT orders), or
    • The Supreme Court under Section 261 (appeal from High Court orders) or under a Special Leave Petition (SLP) under Article 136 of the Constitution.
  • The pending case must involve the same assessee.
  • The assessee must agree to be bound by the final decision of the High Court or Supreme Court on the identical question of law.

3. Procedure:

• • The assessee must submit an application in the prescribed form (Form No. 8 under Rule 16) to the appellate authority before which their appeal is pending (e.g., Commissioner (Appeals) or ITAT).
  • The application must include:
    • A declaration that the question of law in the current appeal is identical to that pending before the High Court or Supreme Court.
    • An undertaking that the assessee will accept the final decision of the High Court or Supreme Court as binding in their case.
    • Details of the pending case, including the court, case number, and status.
  • The application must be accompanied by a fee of ₹100 (as per Rule 16).

4. Action by Appellate Authority:

• • If the appellate authority (Commissioner (Appeals) or ITAT) is satisfied that the question of law is identical and the conditions are met, it may:
    • Defer the appeal until the High Court or Supreme Court decides the pending case.
    • Dispose of the appeal based on the final decision of the higher court without adjudicating the identical question of law.
  • The authority retains discretion to verify the claim of identicality and may reject the application if the questions of law are not identical.

5. Effect of the Higher Court’s Decision:

• • Once the High Court or Supreme Court decides the identical question of law, the appellate authority will apply that decision to the assessee’s case, ensuring consistency.
  • The assessee cannot challenge the applicability of the higher court’s decision in their case, as they have agreed to be bound by it.

6. Time Limit:

• • Section 158A does not prescribe a specific time limit for filing the application, but it should be submitted before the appellate authority decides the appeal.
  • The application must be filed in the assessment year to which the appeal pertains.

Rule 16 of the Income Tax Rules, 1962

• Form and Manner:
  • Rule 16 mandates that the application under Section 158A be filed in Form No. 8.
  • The form requires:
    • Details of the appeal pending before the Commissioner (Appeals) or ITAT.
    • Particulars of the case pending before the High Court or Supreme Court (e.g., appeal number, date of filing, and court).
    • A clear statement identifying the identical question of law.
    • The assessee’s undertaking to accept the higher court’s decision as final.
  • The application must be signed by the assessee or their authorized representative and accompanied by the prescribed fee of ₹100.
• Filing Process:
  • The application is submitted to the appellate authority (Commissioner (Appeals) or ITAT) handling the assessee’s appeal.
  • It can be filed electronically or physically, as per the applicable procedural guidelines (e.g., through the e-filing portal for faceless appeals).

Practical Implications

1. For Assessees:

• • This provision benefits assessees by avoiding the cost and effort of pursuing repetitive appeals on the same legal issue.
  • It is particularly useful in cases involving common legal disputes, such as the interpretation of tax provisions (e.g., eligibility for deductions under Section 80-IA or taxability of specific income).
  • The assessee must carefully ensure that the question of law is identical, as a vague or incorrect claim may lead to rejection of the application.

2. Example:

• • Suppose Mr. Kumar, an assessee, has an appeal pending before the ITAT for the assessment year 2022-23, challenging the disallowance of a deduction under Section 80-IB. The same question of law (eligibility for Section 80-IB deduction) is pending before the Supreme Court in another case involving Mr. Kumar for the assessment year 2020-21.
  • Kumar files Form No. 8 with the ITAT, declaring the identical question of law and agreeing to be bound by the Supreme Court’s decision. The ITAT defers his appeal until the Supreme Court rules. Once the Supreme Court decides, the ITAT applies the ruling to Mr. Kumar’s case for 2022-23, disposing of the appeal accordingly.

3. Grievance Redressal:

• • If the appellate authority rejects the application (e.g., finding the questions of law non-identical), the assessee can challenge the rejection through regular appellate channels (e.g., appeal to ITAT or High Court, depending on the stage).
  • For procedural issues, assessees can contact the Income Tax Department’s grievance cell, such as faceless.appeal@incometax.gov.in, especially in faceless appeal scenarios.

Key Notes

• Section 158A is assessee-friendly, reducing litigation by leveraging decisions in higher courts.
• It applies only to questions of law, not questions of fact, which must be clearly identified in Form No. 8.
• The provision aligns with the faceless appeal and faceless revision frameworks, as applications can be processed electronically under the e-Proceedings platform.
• The assessee’s undertaking to accept the higher court’s decision is binding, limiting their ability to raise the same issue again.
• For procedural details, refer to Form No. 8 and Rule 16 on https://incometaxindia.gov.in or consult the Income Tax Rules, 1962.

Recent Context (as of August 13, 2025)

• The faceless appeal and revision schemes (under Sections 250, 264A, and 264B) have streamlined processes like those under Section 158A, allowing applications to be filed and processed digitally.
• The Income Tax Bill, 2025, emphasizes digital tax administration (e.g., Clause 532), which may further integrate Section 158A applications into the faceless ecosystem, enhancing efficiency.
• Taxpayers should ensure compliance with e-filing protocols and monitor their e-filing portal accounts for updates on such applications.

Comparison: Section 158A vs. Regular Appeal