Section 362 · Appeals
Section 362 of the Income-tax Act, 2025 — Appeals to the Appellate Tribunal (ITAT)
By CA Rajat Agrawal
Updated 05 Jul 2026
Chapter XVIII
📜 What the law says — Section 362, Income-tax Act 2025
362. (1) Any assessee, aggrieved by any of the following orders, may appeal to
the Appellate Tribunal against such order—
(a) an order passed under this Act, by a Commissioner (Appeals) or a Joint
Commissioner (Appeals); or
(b) an order passed by a Principal Commissioner or Commissioner under—
(i) section 332(7) or (8) or (9) or 351(2)(ii) or 354(3); or
(ii) section 377 or 439 or 465; or
(iii) section 287 amending any order as referred to in sub-clauses (i)
and (ii):
(c) an order passed by a Principal Chief Commissioner or Chief Commis-
sioner or a Principal Director General or Director General or a Principal
Director or Director under section 377 or 465 or an order passed under
section 287 amending any such order; or
(d) an order passed by an Assessing Officer under section 270(10) or 279, in
pursuance of the directions of the Dispute Resolution Panel or an order
passed under section 287 in respect of such order; or
(e) an order passed by an Assessing Officer under section 270(10) or 279,
with the approval of the Principal Commissioner or Commissioner as
referred to in section 274(12) or an order passed under section 287 or
288 in respect of such order; or
(f) an order passed by an Assessing Officer under section 234(4).
(2) The Principal Commissioner or Commissioner may, if he objects to any order
passed by the Joint Commissioner (Appeals) or the Commissioner (Appeals) under
this Act, direct the Assessing Officer to appeal to the Appellate Tribunal against the
order.
(3) Every appeal under sub-section (1) or (2) shall be filed within two months from
the end of the month in which the order sought to be appealed against is commu-
nicated to the assessee or to the Principal Commissioner or Commissioner.
(4) The Assessing Officer or the assessee, on receipt of notice that an appeal against
an order, has been preferred under sub-section (1) or (2) by the other party, may,
irrespective of that he may not have appealed against such order or any part thereof,
within thirty days of the receipt of the notice, file a memorandum of cross-objec-
tions, verified in the manner, as may be prescribed, against any part of such order,
and such memorandum shall be disposed of by the Appellate Tribunal as if it were
an appeal presented within the time sp
In plain language
What Section 362 is about
Section 362 of the Income-tax Act, 2025 is the provision that lets you take your tax dispute to the Income Tax Appellate Tribunal (ITAT) — the second and final fact-finding appeal stage. It is the modern replacement for the well-known Section 253 of the Income-tax Act, 1961, and it carries forward the same framework with cleaner drafting.
Think of the appeal ladder like this: first the Assessing Officer passes an order, then you appeal to the Commissioner (Appeals) or Joint Commissioner (Appeals) under the first-appeal provisions, and if you are still unhappy, Section 362 lets you (or the tax department) go up to the ITAT. The Tribunal is an independent quasi-judicial body — it is not part of the Income Tax Department — so it is the first genuinely neutral forum in the appeal chain.
Who can use Section 362
- Any assessee (individual, HUF, firm, company, trust, etc.) who is aggrieved by an order of the Commissioner (Appeals) or Joint Commissioner (Appeals).
- The tax department — the Principal Commissioner or Commissioner can direct the Assessing Officer to file an appeal (a "departmental appeal") if the revenue is unhappy with the first-appeal order.
- Assessees aggrieved by certain other orders, for example orders relating to registration/approval of trusts and institutions, and penalty orders passed by senior authorities, are also routed to the ITAT under this section.
The time limit — this is the most important thing to get right
Every appeal must be filed within two months from the end of the month in which the order being appealed against is communicated to you (or to the Principal Commissioner/Commissioner in a departmental appeal). This "end of the month" style of counting is the rationalised limit that came in from October 2024 and continues under the 2025 Act — it is easier and slightly more generous than the old "60 days from the date of the order".
- Cross-objections: If the other side files an appeal, once you receive the notice you get 30 days to file a memorandum of cross-objections — even if you had not filed your own appeal. A cross-objection is treated like an appeal.
- Condonation of delay: The Tribunal may admit a late appeal or cross-objection if you show "sufficient cause" for the delay. This is discretionary, so never rely on it — file on time.
Form and fees
The appeal is filed electronically in the prescribed form (the ITAT appeal form, historically Form 36; cross-objections in Form 36A) on the e-filing/ITAT portal, verified in the prescribed manner and accompanied by the fee. An appeal filed without paying the correct fee is not valid. The fee depends on your total assessed income:
- Up to ₹1,00,000 assessed income: ₹500
- ₹1,00,001 to ₹2,00,000: ₹1,500
- Above ₹2,00,000: 1% of assessed income, capped at ₹10,000
- Any other matter (not linked to assessed income): ₹500
- Stay of demand application: ₹500
No fee is charged for departmental appeals or for cross-objections filed by either side.
How it interacts with related sections
- First appeal: You can only reach the ITAT after (or in relation to) a first-appeal order from the Commissioner (Appeals)/Joint Commissioner (Appeals).
- Powers and procedure of the Tribunal: Separate sections govern how the ITAT hears cases, its powers to confirm, reduce, enhance or set aside, and rectification of mistakes.
- Appeal to the High Court: An ITAT order can be challenged before the High Court only on a substantial question of law — the ITAT is the final authority on facts.
Practical implications
- The ITAT is the last place you can argue facts and evidence — beyond it, only legal questions survive. So build your factual case fully here.
- Filing an appeal does not automatically stay the tax demand; you must file a separate stay application (fee ₹500) and usually still pay/secure a part of the disputed demand.
- The fee is modest, so cost is rarely the barrier — the real cost is professional representation and preparing paper books, grounds of appeal and case law.
💡 Example
Worked example 1 — computing the fee. Mr. Verma, a Jaipur businessman, has an assessed income of ₹18,00,000. The Commissioner (Appeals) confirmed a disallowance he disputes, so he goes to the ITAT under Section 362. Because his assessed income is above ₹2,00,000, his fee is 1% of ₹18,00,000 = ₹18,000, but it is capped at ₹10,000. So he pays ₹10,000 with Form 36. If instead his assessed income were only ₹90,000, he would pay just ₹500.
Worked example 2 — the time limit. Suppose the CIT(A) order is served on Mr. Verma on 5 May 2026. The clock runs "two months from the end of the month of communication" — i.e., from 31 May 2026 — giving him until 31 July 2026 to file. Under the old 60-day-from-order rule he would have had only until early July, so the new counting method quietly gives him extra time.
A short story. Priya, a salaried professional, lost her first appeal over an HRA disallowance and assumed the demand was final. Her CA reminded her that the ITAT is an independent forum, not part of the department. She filed Form 36 within the two-month window, paid a ₹500 fee (her assessed income slab), and also filed a stay application (another ₹500) so the demand was not enforced while the appeal was pending. Two years later the Tribunal accepted her rent evidence and deleted the addition — a result the departmental authorities had refused.
| Situation | Total assessed income | Appeal fee to ITAT |
|---|
| Low income | Up to ₹1,00,000 | ₹500 |
| Middle slab | ₹1,00,001 – ₹2,00,000 | ₹1,500 |
| Higher income | Above ₹2,00,000 | 1% of assessed income (max ₹10,000) |
| Matter not linked to income | Not applicable | ₹500 |
| Stay of demand application | Any | ₹500 |
| Departmental appeal / cross-objection | Any | Nil (no fee) |
Related sections
Section 253 (1961 Act) — the old ITAT appeals provision Section 362 replaces Section 356 — Appeals to the Commissioner (Appeals) / Joint Commissioner (Appeals) Section 363 — Procedure and powers of the Appellate Tribunal Section 365 — Rectification of mistakes by the Appellate Tribunal Section 366 — Appeal to the High Court on a substantial question of law Section 361 — Constitution and members of the Appellate Tribunal
Frequently asked questions
What is the time limit to file an appeal to the ITAT under Section 362?
Two months from the end of the month in which the order being appealed against is communicated to you. For example, an order served on 5 May 2026 can be appealed up to 31 July 2026.
How much fee do I pay to file an ITAT appeal?
₹500 if assessed income is up to ₹1,00,000, ₹1,500 for income between ₹1,00,001 and ₹2,00,000, and 1% of assessed income (maximum ₹10,000) above ₹2,00,000. There is no fee for departmental appeals or cross-objections.
Is Section 362 the same as the old Section 253?
Yes, in substance. Section 362 of the Income-tax Act, 2025 replaces Section 253 of the Income-tax Act, 1961, carrying forward the ITAT appeal framework with modernised drafting and the rationalised two-month time limit.
Does filing an ITAT appeal stop the tax department from recovering the demand?
No. Filing the appeal does not automatically stay recovery. You must file a separate stay application (fee ₹500), and the Tribunal typically expects part of the disputed demand to be paid or secured while the appeal is pending.
Can I file an appeal after the two-month deadline has passed?
The Tribunal may admit a late appeal or cross-objection if you show sufficient cause for the delay, but this is discretionary. You should never rely on condonation — file within the time limit.
What is a cross-objection and when do I file it?
If the other side appeals, you can file a memorandum of cross-objections within 30 days of receiving notice of that appeal, challenging any part of the order — even if you did not file your own appeal. No fee is charged for cross-objections.
Can I raise new facts or only legal points before the ITAT?
The ITAT is the final fact-finding authority, so you can argue both facts and law here. Beyond the ITAT, an appeal to the High Court lies only on a substantial question of law, not on facts.
C
CA Rajat Agrawal
Chartered Accountant, EaseValue · Reviewed 05 Jul 2026
This explainer is prepared and reviewed by EaseValue's tax team, based on the text of the Income-tax Act, 2025 (as amended by the Finance Act, 2026).
Disclaimer: This page explains the law in general terms for education and is not professional advice. The Income-tax Act, 2025 takes effect from 1 April 2026; provisions, thresholds and interpretations may change. Please confirm your specific position with our team before acting.
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