The ITAT has issued a notice dated 11th May 2017 stating that it intends to make important changes to the Tribunal Rules. The proposed amendments deal with important aspects such as the grant of adjournments, hearings of stay petitions, rectification applications, pronouncements of orders etc.
The proposed changes will have an impact on all tax professionals and tax payers. It is vital that the proposed changes be studied minutely and suggestions offered to the committee that has been set up to approve the changes.
Major amendments proposed by the ITAT Rules, 2017
– Mandatory listing of stay applications on Friday, as long as these are filed before Wednesday
– Mandatory hearing of rectification petitions within 4 weeks of filing
– Expert’s depositions permissible as additional evidence
– Orders to be uploaded within 24 hours if pronouncements
– Emailing of orders and text alerts about adjournment and pronouncements
– Out of turn hearing in the cases of salaried employees, charitable institutions, senior citizens, covered matters, appeals against 201 and 263 orders
– Any ground can be taken up, on the issue in appeal, by the respondent even one day before hearing as long as the other party informed a week before – old rule 27 strengthened
– Ordinarily no more than five adjournments in a case
– E filing of appeals with effect from a date to be notified by the President
– Appeals of persons more than 80 year old to be taken in priority basis in all cases
– Stay application in SMC cases also before the SMC benches only
– Adjournment requests to be filed a day in advance till 1.30 pm
– No orders to be passed beyond 90 days. In case of delay beyond 60 days, reasons for delay to be recorded by the bench on case file
– increase in copying fees
– Form for rectification application is prescribed
– Index to paper book and certification is prescribed
– Stay form is prescribed
– Notice will be sent by email
– Remand report can be called from appropriate income tax authority
– Tribunal empowered to award costs for adjournments
– Hearing of appeal by video conference shall be at the option of the assessee
– Paper book is to be filed in digital form for hearing on video conference
– Power is given to senior member to hear the appeal out of turn basis
INCOME TAX APPELLATE TRIBUNAL (COMMITTEE FOR REVISION OF THE INCOME TAX APPELLATE TRIBUNAL RULES)
11th floor, Lok Nayak Bhawan Khan Market, New Delhi 110 003
PUBLIC NOTICE
May 11, 20171. Over a period of time, it was widely felt that the Income-tax (Appellate Tribunal) Rules, 1963, have outlived their utility to some extent in view of changing circumstances and the use of technology in the Tribunal’s functioning. In the times to come, the use of technology in the Tribunal’s day to day functioning will increase manifold. It is in this background that a need is felt to revisit the existing rules and substitute the same by the new rules. This committee was entrusted with the work of preparing the new Income Tax Appellate Tribunal Rules 2017 in the place of the existing Income-tax (Appellate Tribunal) Rules, 1963.
2. The Committee is pleased to present a draft of the Income Tax (Appellate Tribunal) Rules, 2017 and place the same in public domain for inviting valuable suggestions of all the stakeholders. It is in the light of comments and the feedback of the stakeholders that the substitution of present Income-tax (Appellate Tribunal) Rules 1963, by the proposed Income Tax Appellate Tribunal Rules 2017, will be processed further.
3. The comments and suggestions of all the stakeholders may please be sent by email to itatrulescommittee@gmail.com or by post at the address given below:
Shri R S Syal Vice President Income Tax Appellate Tribunal 11th floor, Lok Nayak Bhawan Khan Market, New Delhi 110 003
4. All the comments and suggestions should reach the Committee latest by 12th June 2017. The Committee deeply values inputs from all the stakeholders and respectfully invites the same for its consideration.
R S Syal,
Vice PresidentPramod Kumar,
MemberSunil Yadav
Committee Chairman
What is the current status of these rules? We’re these adopted? If so when? Which rules apply at present?
The draft rule of the ITAT Rules 2017 is all right. However Rule 6 contemplating power and function of Registrar in Sub-Rule 5(iv) the power of the Registrar quote “ to point out defects , in such appeals and applications , through email, by post or by display on the notice board, to the appellant or the applicant requiring him to rectify the same by affording reasonable opportunity and, if within the time so granted, defects are not rectified, to place such appeals or applications before the Vice President or the Sr. Member, for necessary orders” . To me there should be more clarity in the provision if specific days should be mentioned in place of reasonable opportunity where a rectification can be done.
Similarly in Sub-Rule (vii) of Rule 6 quote “to send the memo of appeals and applications, alongwith enclosures, to respondents, within a reasonable time from their institution, and to receive cross – objection, if any, on the appeal filed by the appellant, and to carry out similar functions as indicated in clause (i) to (vi) of this sub rule”. It should be more clear if the number of days would be written in place of reasonable from their institution.
Mentioning of Matter before the ITAT may be allowed to the parties by giving notice to other side , as per the order of the Bombay High Court in Bharat Petroleum Corporation Ltd v ITAT ( 2013) 359 ITR 371 ( Bom) (HC)
Procedure for listing of appeals rule 22(6)(iii)
Where appeal is filed by or against an individual aged more than eighty years as on the date of application for out of turn hearing.
Suggestion – The age of 80 years may be substituted to 65 years.
Bombay High Court is giving preferencial treatment to the cases wherein one of the parties has attained the age of sixty years or above.
Copy enclosed
CIRCULAR
No.Rule/P-1615/91
This has reference to the High Court Circular No.P.1615/91, dated 12.08.1999 in the matter of giving preference to the cases wherein one of the parties is of advanced age who has crossed 65 years of age.
The Hon’ble the Chief Justice and Judges after reconsidering the issue, have now directed that precedence be given by the Courts for hfearing and final disposal of the cases wherein one of the parties has attained the age of sixty years or above. However, the Courts may grant such indulgence on written request made in that behalf.
This circular shall be applicable to the High Court and its Benches as well as Courts subordinate to it.
HIGH COURT, APPELLATE SIDE,
dated 3rd August, 2009
Registrar General
Hello sir,
Can you please give me the soft copy the CIRCULAR
No.Rule/P-1615/91
This has reference to the High Court Circular No.P.1615/91, dated 12.08.1999.
Suggestion to the proposed Income Tax Appellate Tribunal Rules, 2017.
1. Rule 2 Pertaining to definitions, clause (xi) defining “Rectification application” may be placed after clause (xiv) before clause(xv)
2. Clause xviii- “Stay Application” this clause reads as “Stay Application means an application filed before the Tribunal under rule 15 of the Appellate Tribunal Rules” Reference to Rule 15 may have to be changed as Rule 16.
3. Rule 7 sub rule 1-A memorandum of appeal, a cross objection or any application filed before the Tribunal shall be Presented by the Appellant cross objector or the applicant the case may be —————————————————————————————————————————————————————————————————————– having jurisdiction over the assesse. The words “application filed” may be changes as “application to be filed”.
4. Rule 24 – Preparation of paper book etc.
In this rule, sub rule (4) reads as “the additional evidence, if any shall not form part of the same paper book. If any party desires to file additional evidence, then the same shall be filed by way of a separate paper book, in accordance with sub rule (3) accompanied by an application stating the reasons for filling such additional evidence.
The words “stating the reasons for filling such additional evidence” may either be omitted or changed to “stating the reasons for not filling such additional evidence before the lower authorities”. Similarly, in Form No: – AT-4, the column no. 5 may accordingly be changed.
This would make this rule similar to that of rule 25(1) and would be in keeping with the practice followed till now.
In Rule 24, sub rule 5 reads as “The parties shall not be entitled to submit any supplementary paper book, except with the leave of the Tribunal” the words “except with the leave of the Tribunal” may be removed so that the parties would be free to file supplementary paper book and the Tribunal could decide the relevance, necessity etc. during the course of the hearing proceedings and decide accordingly.
Rule 24 sub-rule (6) reads s “Documents that referred to and relief upon by the parties during the course of argument shall alone be treated as part of the record of the Tribunal” This clause may be reconsidered, as sometimes, this clause may create difficulties to the parties, particularly when argument are directed to be curtailed for want of time or for any other reason.
Rule 24 sub Rule 7 reads as “paper book not conforming to the above rules are liable to be ignored”. This sub rule appears to be not necessary and if found necessary, may be positively worded, be saying that “the paper books shall conform to the above rules as far as possible”.
Suggestions by Mr. M.P. Lohia
Suggestions / Comments to the new draft ITAT Rules, 2017
1. Proposed Rule 2(xviii) – Definition of stay application
Relevant extract of proposed Rule 2(xviii) is as under:
“‘stay application’ means an application filed before the Tribunal, under rule 15 of the Appellate
Tribunal Rules;”
Comments/ suggestions: The words “rule 15” should be replaced with “rule 16”.
2. Proposed Rule 9 – What to accompany memorandum of appeal
Relevant extract of sub-rule (2) of proposed Rule 9 is as under:
“(2) An appeal, filed in respect of penalty, shall be accompanied by copies of (a) the order
appealed against (b) the grounds of appeal filed before the first appellate authority; (c) the
statement of fact filed before the first appellate authority or the dispute resolution panel, as
the case may be; (d) the penalty order passed by the Assessing Officer in respect of which the
appeal is filed; (e) the assessment order passed by the Assessing Officer in the course of which
impugned penalty is levied; and (f) an application seeking condonation of delay, in case the
appeal is filed after the expiry of time limit, prescribed under the statute, before the Tribunal.”
Comments/ suggestions: The words “or the dispute resolution panel” should be removed as in
case of penalty, the first appellate authority will never be the dispute resolution panel.
3. Proposed Rule 9 – What to accompany memorandum of appeal
Relevant extract of sub-rule (6) of proposed Rule 9 is as under:
“(6) An appeal will be in form number 36 of the Income Tax Rules and shall be submitted in
triplicate, accompanied by two self-certified copies of the attachments referred to in sub rule
(1), (2), (3), (4) and (5) of this rule, along with evidence of payment of appeal filing fees, if
applicable.”
Comments/ suggestions: Since the appeal memo needs to be submitted in triplicate, it is
suggested that the attachments accompanying such appeal memo should also be submitted in
triplicate.
4. Proposed Rule 10 – What to accompany memorandum of appeal by the Assessing Officer
Proposed Rule 10 reads as under:
In an appeal under sub-section (2) of section 253, a self-certified copy of the order of the
Commissioner directing that an appeal be preferred, shall be appended to the memorandum of
appeal.
Comments/ suggestions: The said proposed rule should be re-worded as under so as to include
the documents mentioned in proposed rule 9:
In an appeal under sub-section (2) of section 253, in addition to the attachments referred to in
sub-rule (1), (2), (3), (4) and (5) of Rule 9, a self-certified copy of the order of the Commissioner
directing that an appeal be preferred, shall also be appended to the memorandum of appeal.
5. Proposed Rule 17 – What to accompany stay application
Relevant extract of sub-rule (1) of proposed Rule 17 is as under:
“(1) An application for stay on recovery of demands of tax, penalty or interest impugned in the
appeal before the Tribunal shall be accompanied by (a) a statement of financial position as on
the date on which stay is sought; (b) a copy each of the applications moved to the income tax
authorities seeking stay, and, orders passed thereon, if any; (c) a copy each of any other
document that the applicant may consider relevant in this regard.”
Comments/ suggestions:
1. Proposed Form AT-2 mentions the following words – ’10. Brief details of financial position
as on the date of this application, or the date nearest thereto’. Accordingly, similar words
should also be used in the Rules corresponding the Form.
2. Further, suitable amendments should be made so as to provide for submission of the
financial position of the applicant, as on the date of the application or the nearest date,
only in cases where the applicant takes the plea of financial hardship as the reason for stay
of demand and not otherwise in all scenarios.
6. Proposed Rule 22 – Procedure for listing of appeals
Relevant extracts of sub-rule (5) of proposed Rule 22 is as under:
“An appeal in respect of which an early hearing is granted, and in the event of the related bench
not functioning on the scheduled date of hearing, the appeal may be temporarily transferred to
any other functioning bench, as per the directions of Hon’ble President, Vice President or Sr
Member- as the case may be.”
Comments/ suggestions: For Benches in Mumbai and Delhi, this clause would create practical
difficulties for matters involving issues relating to transfer pricing and international taxation and
also SMC benches as separate benches have been dedicated to such cases (viz ‘K’ & ‘L’ Bench in
Mumbai for transfer pricing and international taxation issues) and benches other than such
dedicated benches do not hear matters involving such issues.
7. Proposed Rule 30 – Adjournment of appeal
Comments/ suggestions:
In case the counsel appearing for the matters would be travelling from outstation, suitable
provisions should also be made for intimating such counsel, well in advance and a time line of
two to three days prior intimation should be made.
8. Proposed Rule 31 – Continuation of proceedings after death or insolvency of party to the appeal
Comments/ suggestions:
In the draft proposed Rules, only cases of winding up are considered.
However, in cases of amalgamation/ merger, relevant rules shall be inserted to state that the
proceedings shall continue in the name of the amalgamated/ existing company
Further, in cases of demerger, relevant rules shall be inserted to state that the proceedings shall
continue in the name of the resulting company
Further, in case of change of registered address of a company, relevant rules shall be inserted
to state that the proceedings shall be transferred to the jurisdiction in which the new registered
office of the company is located.
9. Proposed Rule 34 – Remand by the Tribunal
Relevant extracts of the proposed Rule 34 is as under:
“(2) The Tribunal may, if it considers necessary for disposal of an appeal, call for a remand
report from appropriate income tax authority.
(3) Such remand report shall be placed before the same coram of the Tribunal, for disposal of
the appeal. In case any of the Members is no longer available at that bench, on account of
retirement or transfer, the Vice President or the Sr Member, as the case may be, shall nominate
another Member in his place.”
Comments/ suggestions: The rules must also include provisions for the following:
1. Upon receipt of the remand report, the same should be served to both the parties to the
appeal.
2. Reasonable opportunity and sufficient time shall be provided to the parties to prepare
rebuttals in response to the said remand report
10. Proposed Rule 35 – Award of costs
Comments/ suggestions: The said proposed rule shall also include the following:
1. Costs on adjournments shall be awarded only after five adjournments
2. There should be an upper cap for the costs to be awarded
11. Proposed Form AT-3 – Furnishing details on which communications can be served
Comments/ suggestions: Presently, in the Form AT-3, it is mentioned that genesis of Form AT-3
is Rule 31(4) of the ITAT Rules, 2017. However, such rule does not exist. Accordingly, correct
reference to Rule 28(4) of the ITAT Rules, 2017 must be mentioned.
Other comments/ suggestions:
1. Reference to notifications based on the existing ITAT Rules of 1963 must also be amended so as
to apply in pursuance to the newly proposed ITAT Rules of 2017 (eg. Standing Order under
Income-tax(Appellate Tribunal) Rules, 1963).
2. Appropriate forms for no MD certificate and authorized signatory for signing of appeals should
also be prescribed.
3. In the proposed rules, it is prescribed that notice of hearing, or intimation of adjournment, may
also be sent by text messages. However, appropriate security measures must be undertaken to
ensure sanctity and authenticity of such text messages.
Draft Tribunal Rules
Suggestions by Mr. Subhash S. Shetty
Date of presentation of appeal ……………………
18.
(i) the date of presentation of appeal, cross objection or application will be the date of on which it is successfully e-mailed
The above does not cover the case of appeal filled physically.
Rejection of, and modification in, appeal, cross objection and application
19
1)
2)
3)
There should not be any right with the registry to reject any appeal, cross objection etc.
The same may be placed before the bench to decide.
Hearing of the appeal
28
1)
2)
3)
4)
Parties to the appeal shall furnish the communication details, In form No. AT-3, at any time before the hearing commences …………………..
Communication details should be made part of appeal form itself.
Adjournment
30
1)
2)
3)
4)
5) Bench not functioning
Next date of hearing should be intimated to the assesse by issuance of fresh notice.
Hearing of appeal ex-parte
32
Appeal should not be dismissed on the first instant of the appellant being absent.
Proviso:
Appellant appears afterword’s and satisfies the Tribunal ……………………
Meaning thereof
Same for proviso to 33.
copying fees not to be increased, assessees are always harassed lot is my considered view; else most other changes seem reasonable, tks
1. Pending the Appeals before Tribunal if the Assessee is dies, an application made by the legal heirs may be taken up for early hearing.
2. When an Appeal is filed by an Individual who is a Seniour Citizen above 65 years of age may be taken out of hearing. The Word Eighty Years may be subsituted by Sixty Five Years.
To,
Dr. K. Shivram,
MUMBAI.
Dear Dr. K. Shivram,
As desired I have gone through ITAT Rules, 2017. I have following suggestions :-
(i) For assessee’s and A/R’s staying at a place other than the location of the Bench it would be difficult to comply with Rule 30(2). Rule 30(4) does away with communication of next date by the Tribunal when adjournment is at the instance of the assessee. For out station assessee’s seeking adjournment, ascertainment of next date may be difficult. As in the past the registry must communicate next date. Rule 30(5) need deletion. If bench is not functioning the assessee must be communicated next date of hearing. It should be duty of the registry.
(ii) In Rule 40(4)(c) normal period to pronounce should not exceed 30 days with an extension of 15. 60 days with extension of 30 days i.e. 90 days is too long particularly when the members close hearing by lunch and have sufficient time to study and dictate every day. In Rule 40(4)(d) there is a mandate to pass by the specified period, but what would be effect on contravention is silent.
(iii) In Rule 41(1) time during which the Tribunal would serve a certified copy needs to be stated.
(iv) In Rule 42(2) non-acceptance of a document in a language other than English without translation does not appear to be proper, particularly in Hindi speaking notified area.
Kindly consider.
With Best Wishes.
Yours sincerely,
(N. M. Ranka)
Senior Advocate