Section 374 of the Income-tax Act, 2025 — Interpretation of "High Court" for Tax Appeals

In plain language

What Section 374 actually does

Section 374 of the Income-tax Act, 2025 is a pure "definition" or interpretation clause. It does not levy tax, allow a deduction or create any liability. Its single job is to tell you which High Court is the correct one when the word "High Court" is used in Chapter XVIII of the Act — the chapter that governs Appeals, Revisions and Alternate Dispute Resolution. In plain words: when the law says an appeal on a substantial question of law lies "to the High Court", Section 374 answers the question — which High Court?

This matters because India has 25 High Courts, and several of them have jurisdiction over more than one State or Union Territory. Without a mapping clause, a taxpayer or the Income-tax Department could be confused about where to file a tax appeal. Section 374 removes that doubt by giving a fixed, territory-by-territory map.

Who it applies to

• Any taxpayer — individual, HUF, firm, company, trust — who is aggrieved by an order of the Income Tax Appellate Tribunal (ITAT) and wants to appeal to the High Court under the Act.
• The Income-tax Department (the Principal Commissioner/Commissioner), who is equally entitled to file appeals to the High Court.
• Tax practitioners, CAs and advocates filing or advising on tax litigation, who need to know the correct forum.

It applies purely through the location/jurisdiction over which the assessment was made — you file in the High Court that has territorial jurisdiction over the assessing officer/State or Union Territory concerned.

The territory-to-High-Court map

Based on the text of Section 374, the definition covers every State and the Union Territories that do not have their own High Court:

• For any State — the High Court for that State (so Gujarat matters go to the Gujarat High Court, Rajasthan matters to the Rajasthan High Court, and so on).
• Jammu & Kashmir and Ladakh — the High Court of Jammu and Kashmir and Ladakh (common to both UTs).
• Andaman & Nicobar Islands — the High Court at Calcutta.
• Lakshadweep — the High Court of Kerala.
• Chandigarh — the High Court of Punjab and Haryana.
• Dadra & Nagar Haveli and Daman & Diu — the High Court at Bombay.
• Puducherry — the High Court at Madras.
• National Capital Territory of Delhi — the High Court of Delhi.

How it fits with the rest of the Act

Section 374 has no meaning on its own — it is a servant of the appeal machinery in Chapter XVIII. It is read together with the sections that allow an appeal to the High Court (on a substantial question of law arising from an ITAT order), the section on appeals to the Supreme Court, and the general provisions on limitation periods, monetary limits for filing departmental appeals, and the effect of an appeal. Where those sections say "High Court", you look to Section 374 to identify it.

Why the wording changed from the old law

The 1961 Act carried this same idea in Section 269. Section 374 is the modern, cleaned-up successor. The most important update is that it reflects India's post-2019 territorial reorganisation — notably the creation of the separate Union Territories of Jammu & Kashmir and Ladakh and the merger of Dadra & Nagar Haveli with Daman & Diu — so the map now matches today's map of India. The legal effect is essentially the same; the change is about accuracy and clarity, not a change of your rights.

Practical implications

• File in the right court. Filing in the wrong High Court can cost you time and, if the limitation period lapses, your right to appeal. Section 374 is your checklist.
• No fees or rates here. This section carries no tax rate, threshold or penalty. Court fees and the monetary limits for departmental appeals come from other provisions and CBDT circulars.
• Businesses operating across States should note that jurisdiction follows the assessment, not the head office alone.