The second appeal, the departmental monetary floor, and the 6-month rectification window
The second appeal, against an order of the Commissioner (Appeals), is to the Income-tax Appellate Tribunal (ITAT), filed on Form 36 within 60 days, with fees scaled to assessed income. The ITAT is the final fact-finding authority; a further appeal lies to the High Court only on a substantial question of law. Two points are decisive in practice. The Department cannot file an appeal to the ITAT where the tax effect is below Rs 60 lakh (CBDT Circular 9/2024), so many of your first-appeal wins are effectively final. And if you spot a mistake in an ITAT order, you have only 6 months to apply for rectification, the old four-year window is long gone.
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Filing the second appeal
If the Commissioner (Appeals) decides against you, you appeal to the ITAT on Form 36 within 60 days of that order. The fee is scaled to assessed income (Rs 500 up to Rs 1 lakh, Rs 1,500 between Rs 1 and 2 lakh, and 1% of assessed income capped at Rs 10,000 above that). The Revenue can also appeal, and you can file a cross-objection on Form 36A within 30 days with no fee. Benches are usually a division bench (a judicial and an accountant member), with single-member (SMC) benches for smaller cases.
The departmental monetary floor
The Department is bound by CBDT monetary limits below which it should not file or pursue appeals. Under Circular 9/2024 (September 2024) these were raised to a tax effect of Rs 60 lakh for the ITAT, Rs 2 crore for the High Court and Rs 5 crore for the Supreme Court, and pending below-threshold appeals were to be withdrawn. The practical effect for a taxpayer is significant: if your tax dispute is below Rs 60 lakh and you won before the Commissioner (Appeals), the Department generally cannot take it to the Tribunal, so the win is effectively final.
tipIf your tax dispute is under Rs 60 lakh and you won at the first appeal, the Department generally cannot appeal to the Tribunal (Circular 9/2024). Many CIT(A) wins are therefore final in practice.
The 6-month rectification window
If an ITAT order contains a mistake apparent from the record, you can apply under Section 254(2) for rectification, but the window is just 6 months from the end of the month in which the order was passed (some High Courts measure it from the date you receive the order). This is a hard, short deadline, the earlier four-year window was cut to 6 months by the Finance Act 2016. So read the order promptly and move fast if it contains an apparent error.
warningYou have only 6 months to seek rectification of an ITAT order under Section 254(2). The old four-year window is gone, so check the order as soon as you receive it.
How do I appeal to the Income-tax Appellate Tribunal?+
If the Commissioner (Appeals) decides against you, you file Form 36 with the ITAT within 60 days, paying a fee scaled to assessed income (up to 1% capped at Rs 10,000). The ITAT is the final fact-finding authority; a further appeal to the High Court is only on a substantial question of law. You can also file a cross-objection on Form 36A within 30 days, free.
Can the Department appeal a small case to the Tribunal?+
Generally no. Under CBDT Circular 9/2024, the Department should not file an appeal to the ITAT where the tax effect is below Rs 60 lakh (Rs 2 crore for the High Court, Rs 5 crore for the Supreme Court). So if your dispute is under Rs 60 lakh and you won at the first appeal, that win is usually final, the Department cannot pursue it further.
I found a mistake in my ITAT order. Can it be fixed?+
Yes, if it is a mistake apparent from the record, through a rectification application under Section 254(2), but you must act within 6 months from the end of the month the order was passed. The old four-year window was cut to 6 months by the Finance Act 2016, so read the order promptly and file quickly if there is an apparent error.
Is the ITAT the last stage of a tax appeal?+
It is the final fact-finding stage. After the ITAT, an appeal lies to the High Court only on a substantial question of law (not on the facts), and then to the Supreme Court. Because the ITAT settles the facts, and because the departmental monetary floors limit further appeals, most disputes effectively end at the Tribunal.