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Income-tax Act, 1961 · Chapter XX: Appeals and Revision · CC.—Appeals to High Court

Section 260A: Appeal to High Court

The Income-tax Act, 1961 was repealed by the Income-tax Act, 2025 from 1 April 2026. The text is kept here because the judgments below apply it.

In plain words

An appeal lies to the High Court from an order of the Appellate Tribunal, but only if the case involves a substantial question of law. This replaced the old reference procedure for later orders.

  • The assessee or the tax department can appeal.
  • The appeal must be filed within one hundred and twenty days of receiving the order, and must state the substantial question of law.
  • The High Court can admit a late appeal if there was sufficient cause.
  • If satisfied that a substantial question of law arises, the High Court frames it and hears the appeal only on that question, though it may hear another such question for recorded reasons.
  • Findings of fact by the Tribunal are usually final. A question of fact becomes a question of law only if the finding is perverse or based on no evidence.
  • The Code of Civil Procedure, 1908 applies to these appeals as far as possible.

A simplified explanation, prepared with AI assistance from the official text below and checked automatically against it for numbers and cross-references. The official text is the law and prevails over this summary. Not legal advice.

Read the in-depth explanation, with key Supreme Court rulings ↓

Official text

(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 the [Principal Commissioner or Commissioner] or an assessee aggrieved by any order passed by the Appellate Tribunal may file an appeal to the High Court and such appeal under this sub-section shall be—]

(a) filed within one hundred and twenty days from the date on which the order appealed against is [received by the assessee or the [Principal Chief Commissioner or Chief Commissioner] or [Principal Commissioner or Commissioner]; * * * * *

(c) in the form of a memorandum of appeal precisely stating therein the substantial question of law involved. [(2A) The High Court may admit an appeal after the expiry of the period of one hundred and twenty days referred to in clause (a) of sub-section (2), if it is satisfied that there was sufficient cause for not filing the same within that period.]

(3) Where the High Court is satisfied that a substantial question of law is involved in any case, it shall formulate that question.

(4) 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:

Provided that 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.

(5) 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.

(6) The High Court may determine any issue which—

(a) has not been determined by the Appellate Tribunal; or

(b) 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). [(7) Save as otherwise provided in this Act, the provisions of the Code of Civil Procedure, 1908 (5 of 1908), relating to appeals to the High Court shall, as far as may be, apply in the case of appeals under this section.]

Source: India Code (Legislative Department), the text of the Act as it stood before its repeal. Words in square brackets [ ] were inserted or substituted by later amending Acts, and *** marks words omitted by an amendment. The amendment footnotes are not reproduced here. Official text on India Code.

Understanding this section

Section 260A provides an appeal to the High Court from orders of the Appellate Tribunal, but only if the case involves a substantial question of law. It replaced the old reference procedure in section 256 for orders passed on or after 1 October 1998.

Substantial question of law

The question must be one of law, and substantial: debatable, not already settled by binding authority, and material to the outcome. The Tribunal is the final fact finding body, so findings of fact are open only if perverse or based on no evidence.

The High Court must formulate the question when it admits the appeal, and the appeal is heard on that question. It may hear another substantial question if it records reasons.

Procedure

The appeal is filed within one hundred and twenty days of receipt of the Tribunal's order, with a memorandum stating the question. The Code of Civil Procedure applies to these appeals as far as possible. Where the High Court decides an appeal on merits, it should frame the questions and give reasons, even if it ultimately finds for the respondent.

Key Supreme Court rulings

Common mistakes

  • Framing a question of fact as a question of law.
  • Arguing in the High Court on questions that were never formulated.

Read with: Section 256 Income-tax Act, 1961, Section 261 Income-tax Act, 1961

Prepared with AI assistance as a study aid. Every ruling listed was checked against the Supreme Court's own judgments on this site, and quoted words appear in those judgments; linked names open the full judgment. Read the judgments themselves before relying on them. Not legal advice.

Supreme Court judgments citing the section 260A