Section 358 of the Income-tax Act, 2025 — Form of Appeal and Limitation (First Appeal to CIT/JCIT (Appeals))

In plain language

What Section 358 is about

When the Income-tax Department passes an order you disagree with — an assessment raising extra tax, a penalty, a refund denial — your first line of remedy is a first appeal to the Commissioner (Appeals) or the Joint Commissioner (Appeals). Sections 356 and 357 tell you which orders are appealable and to whom. Section 358 is the "how and by when" section — it lays down the form, fee, verification, time limit and the pre-conditions for filing that appeal. Get Section 358 wrong and a perfectly good case can be thrown out on a technicality. This provision corresponds to Section 249 of the old Income-tax Act, 1961, and the substance is largely carried forward unchanged.

The prescribed form — Form 99

• New form: The appeal must be made in Form 99, prescribed under Rule 167 of the Income-tax Rules, 2026. Form 99 replaces the old Form 35 used under the 1961 Act.
• Electronic only: Form 99 must be filed electronically on the income-tax e-filing portal. It must be verified using a Digital Signature Certificate (DSC) if your return was filed under DSC, otherwise through an Electronic Verification Code (EVC).
• Grounds of appeal: You must attach a statement of facts and the grounds of appeal, along with the order appealed against and the notice of demand.

The appeal fee (Section 358(2))

A modest fee — unchanged from the old law — is payable based on the total income computed by the Assessing Officer:

• ₹250 where assessed total income is ₹1,00,000 or less;
• ₹500 where it is more than ₹1,00,000 but not more than ₹2,00,000;
• ₹1,000 where it exceeds ₹2,00,000;
• ₹250 where the subject of appeal does not relate to assessed income (e.g. a TDS or procedural order).

The 30-day limitation (Section 358(3))

This is the heart of the section. The appeal must be presented within 30 days of the relevant date:

• Assessment or penalty orders: 30 days from the date of service of the notice of demand relating to the order.
• Any other case: 30 days from the date on which the order sought to be appealed against is served/intimated.

Where you first filed an application to the AO under Section 440 (a stay/immunity route) and it was rejected, the time spent on that application is excluded when counting the 30 days (Section 358(4)).

Condonation of delay (Section 358(5))

The 30-day limit is not fatal. The CIT(A)/JCIT(A) may admit a late appeal if satisfied that the appellant had "sufficient cause" for the delay — for example, hospitalisation, non-receipt of the order, or reliance on wrong professional advice. You should file a separate condonation application explaining the delay with evidence.

Pre-conditions before an appeal is admitted (Section 358(6) & (7))

An appeal will not be admitted unless, at the time of filing:

• Return filed: the assessee has paid the tax due on the income returned (self-assessment tax); or
• No return filed: the assessee has paid an amount equal to the advance tax that was payable.

This is the "pay-what-you-admit" rule — you cannot dispute the extra demand without first clearing the tax on income you yourself declared. However, under Section 358(7), the appellate authority may, for reasons to be recorded in writing, exempt the appellant from this condition in genuine hardship cases where paying the advance-tax equivalent is not possible.

How it fits with related sections

Section 358 works alongside Section 356/357 (appealable orders and forum), Section 359 (procedure in appeal), and Section 360 (powers of the appellate authority). If you lose here, the next step is the Income Tax Appellate Tribunal under the appeals chapter (Sections 361 onwards). Note that where immunity is claimed under Section 440, an appeal on that issue is barred.

Practical implications

• Diarise the date of service the moment the demand notice arrives — the clock starts then, not from the order date.
• Pay the self-assessment/advance-tax equivalent before filing, or file a Section 358(7) hardship request simultaneously.
• Keep the DSC/EVC ready — Form 99 cannot be filed on paper.