Presentation on "Representation before Appellate Authorities" by CA Mehul Shah. Mob: 9723459572

1. REPRESENTATION
BEFORE
APPELLATE
AUTHORITIES
CA Mehul Shah
9723459572

2. Audit and ITR
Scrutiny
Assessment
Order
CIT (A)
Tribunal
High Court
Supreme
Court
30.09.2008
notice
30.09.2009
31.12.2010
Within 30
days
Within 60
days
Within120
days
No time limit
specified
ITR 1 to 7
Reply to
show cause
notice
31.12.2010
Form 35
From 36
Prescribed
Prescribed
By CA Mehul Shah

3. Something missing ???
Centralized Processing -
Intimation u/s 143(1)
Online Rectification u/s
154
Dispute Resolution Panel
By CA Mehul Shah

4. There are three ways to file returns
electronically
4
Option 1:Use digital signature in which case no paper return is required to
be submitted.
Option 2: File return without digital signature in which case ITR-V
form is to be sent to CPC-Bangalore within 120 days after the date of
transmitting the data electronically. This is a single page receipt cum
verification form.
Option 3: File through an e-return intermediary who would do e-Filing and
also assist the Assessee to file ITR V Form
By CA Mehul Shah

5. Centralized Processing - Intimation
u/s 143(1)
• 100 % returns shall be processed.
• Any incorrect claim apparent from any information
recomputed -
• Which is inconsistent with another entry of the same or
other item in return.
• Information required to be furnished to substantiate the
claim has not been furnished
• Deduction exceeds statutory limit.
By CA Mehul Shah

6. 6
Important Steps involved in filing
rectification request online:-
• Rectification request can be filed online only after receipt of
intimation u/s 143(1) for A.Y 2009-10 & onwards.
• Identify the items that require rectification – reference should
be made to the common error guide as also reference
manual.
• Complete xml file is required to be uploaded. Complete
return (not only the data which needs correction) should be
filled including tax details as entire return would be re-
processed for rectification.
By CA Mehul Shah

7. 7
Important Steps involved in filing
rectification request:-
• There should not be any REVISION IN INCOME FIGURES OR
NEW CLAIMS as the facility is only for CORRECTING
MISTAKES APPARENT FROM RECORD. – rectification request
may be delayed or rejected.
• Generate rectified xml file & log on to the web site.
• Give reasons for seeking rectification & select schedules which
are changed.
• Select address change check box in case there is a change in
address in rectification xml file.
• Upload the rectified xml file.
By CA Mehul Shah

8. CA Sapnesh Sheth8
By CA Mehul Shah

9. Audit and ITR
Scrutiny
Assessment
Order
CIT (A)
Tribunal
High Court
Supreme
Court
30.09.2008
notice
30.09.2009
31.12.2010
Within 30
days
Within 60
days
Within120
days
No time limit
specified
ITR 1 to 7
Reply to
show cause
notice
31.12.2010
Form 35
From 36
Prescribed
Prescribed
By CA Mehul Shah

10. Levels of Appellate Authority
 At present there are four levels of appeals
 Commissioner of Income-tax(Appeals)
 Income-tax Appellate Tribunal
 High Court
 Supreme Court.
 The tribunal is ultimately fact finding authority
 So appeal to High Court and Supreme Court can
be preferred only in cases involving ‘Substantial
Question of Law’.
By CA Mehul Shah

11. Overview of presentation
Drafting of Appeal
Form 35 , Form 36
Submission before
CIT (A)
Paper Book
Appearing before
Appellate Authorities
Composition and
Dress Code
Procedure in
Hearing Appeal
Flow of
representation
By CA Mehul Shah

12. 12
Dress Regulations
 Rule 16A deals with dress regulations for members and
authorised representatives of parties
 In the case of members, the white shirt on white pant with black
coat , a black tie of buttoned up in summer. In winter, striped or
black trouser in place of white trousers. For female members,
black coat over white saree or any other sober saree.
 In case of male authorised representatives, the coat with a tie or
buttoned up coat (preferably black colour) over a pant. In case of
female AR, black coat over white saree or any other sober saree.
By CA Mehul Shah

13. 13
Dress Regulations
 However, if professional bodies of lawyers or Chartered
Accountants prescribe any dress for appearance, the ARs may
appear in such prescribed dress.
By CA Mehul Shah

14. Overview of presentation
Drafting of Appeal
Form 35 , Form 36
Submission before
CIT (A)
Paper Book
Appearing before
Appellate Authorities
Composition and
Dress Code
Procedure in
Hearing Appeal
Flow of
representation
By CA Mehul Shah

15. 15
Form of Application for Appeal …Order..
Order….!
By CA Mehul Shah

16. Form 35 – Appeal to CIT(A)
Appeal Memo
Statement of facts
Grounds of Appeal
Verification form
By CA Mehul Shah

17. Grounds of Appeal
 Legal Ground of Validity of Assessment
 Items of addition [Grounds for telescoping to be
mentioned separately]
 Items of Interest
 Prayer
 Reservation to raise additional ground
By CA Mehul Shah

18. Grounds of Appeal before
CIT(A)
 On the facts and in circumstances of the case as well
as law on subject, the assessing officer has erred in
making addition of Rs……. for alleged low gross
profit.
 Other grounds on above lines
 Prayer.
 Reservation to raise additional ground.
By CA Mehul Shah

19. Contents of Statement of
Facts
General Introduction of case
Background Facts leading to each addition
Reference of submission made before AO
Reference of documents filed in support of submission
Summary of finding of Assessing Officer
Dispute of observations of assessing officer with reasons
By CA Mehul Shah

20. Statement of Facts
 It is vital for the assessee to present the statement of
facts(SOF) in first appeal in such a manner so as to
bring out clearly the steps in the assessment/penalty
proceedings leading to the addition / disallowance under
challenge.
 In SOF, the assessee must refer various evidences and
explanation given at the time assessment /penalty
proceeding.
 If the facts stated by assessee has not been considered,
it should be stated so in SOF.
 If the assessing officer states wrong facts contrary to
record in order, the assessee must dispute that and
bring on record correct facts in SOF.By CA Mehul Shah

21. Importance of Statement of Facts
 The importance of drafting detailed SOF in first appeal is
important for three reasons.
 Firstly, the copy of SOF is also forwarded to assessing
officer and if the assessing officer does not dispute the
same, it will be taken as correct in second appeal.
 Secondly, there is no requirement to file statement of
facts in second appeal.
 Thirdly, the tribunal rules requires that no facts contrary
to records can be stated by either party unless
supported by affidavit.
By CA Mehul Shah

22. ENCLOSURES
 Form 35 - Statement of facts and Grounds of
Appeal before CIT(A)
 Assessment order u/s 143(3)
along with original copy of demand
notice
 Challan original copy
 Letter of Authority
In Duplicate
By CA Mehul Shah

23. 23

24. 24
Assessee aggrieved by following orders
shall appeal to Appellate Tribunal
Order passed by CIT (A) u/s 250
An order passed by CIT u/s 12AA, 80G
An order passed by Assessing Officer u/s 143(3) or
147 in pursuance of the direction of the Dispute
Resolution Panel
By CA Mehul Shah

25. • In the recent past, the use of alternative dispute resolution
practices has been growing in importance and popularity
world wide, having resolved both international conflicts and
domestic arrangements
• In the international tax scenario, an impetus was provided
with the introduction of the Mutual Agreement Procedures in
the bilateral tax treaties.
• With this expansion of new methods of dispute resolution
worldwide, a need arose for such a mechanism in India to
facilitate speedy resolution of numerous pending tax
disputes
• Section 144C of the Income Tax Act, 1961 (‘Act’) was
Dispute Resolution
Mechanism
25

26. 144C Dispute Panel Resolution
Consists of a collegiums of 3 commissioners of
income tax for dealing with complex matters
relating to TP or the tax disputes of foreign
companies.
 An alternate dispute resolution mechanism is a
prevailing mode in many other countries and as
the Transfer pricing law develops in India, we
have also rightfully adopted it
By CA Mehul Shah

27. 144C Dispute Panel
Resolution
 Relevant Provisions :
 Only an eligible assessee can avail the
facility of reference to the Dispute panel
resolution.
 The Assessing Officer at the first instance
forward the draft assessment order if he
propose to make any variation in the
income or loss returned which is prejudicial
to the interest of the assessee
 Within 30 days from the date of receipt of
the draft order, the eligible assessee shall
file his acceptance of the variations to the
assessing officer or file his objections.By CA Mehul Shah

28.  If the assessee intimates the acceptance of
the proposed variations to the assessing
officer proposed or no objections is received
from the assessee within 30 days as
specified above, the assessing officer shall
complete the assessment based on the draft
order and the time limit for the above is 1
month from the end of the month in which
 the acceptance is received
or
 the time limit for filing objection expires.
By CA Mehul Shah

29. The dispute panel resolution shall issue directions to
the assessing officer upon the receipt of objections
from the assessee within 9 months from the end
of the month in which draft assessment order is
forwarded to the assessee.
 Before issuing any directions, the dispute panel
resolutions may make such further enquiry as it
thinks fit or cause any other further inquiry.
 The Dispute panel resolution shall issue directions
only after giving opportunity of being heard to the
assessee and assessing officer.
 The Dispute panel resolution may confirm, enhance,
reduce the variations proposed in the draft order.
 If the members of the Dispute Resolution panel differ
in their opinion on any point, the point shall be
decided according to the opinion of the majority of
the members.By CA Mehul Shah

30. DRP – A FEW COMMENTS
 The newly inserted section 144C has generated
a lot of excitement and interest. It will be a path
breaking mechanism in dispute resolution for TP
and foreign companies.
 The Hon. Supreme Court, in the recent case of
HCL Technologies Ltd. has
approvingly taken note of the
DRP and has advised the parties to resort to it. It
also directed the competent authority DRP, to not
reject the application of the assessee.
 Suitable directions/action to put section 144C
into
motion are awaited.By CA Mehul Shah

31. 31
Assessee aggrieved by following orders
shall appeal to Appellate Tribunal
Order passed by CIT (A) u/s 250
An order passed by CIT u/s 12AA, 80G
An order passed by Assessing Officer u/s 143(3) or
147 in pursuance of the direction of the Dispute
Resolution Panel
By CA Mehul Shah

32. 32
Form of Appeal before Tribunal
Form No. 36 setting forth grounds of appeal
(In Triplicate)
Concise
Distinct Head
Without any argument or narration.
Numbered Consecutively.
By CA Mehul Shah

33. Grounds Before Tribunal
 Addition for gross profit
 On the facts and in the circumstances of the case as
well as law on the subject, the learned CIT(A) has
erred in confirming the action of assessing officer in
making addition of Rs…… for alleged low gross
profit.(description and submission should be avoided)
 Other grounds on above lines
 Prayer
 Reservation to raise additional ground.
By CA Mehul Shah

34. Enclosures – (In Triplicate)
Relevant order of CIT or CIT(A) (One
Certified Copy)
Assessment Order
Grounds of Appeal filed in first appeal
Statement of Facts filed in first appeal
Direction u/s144A-if assessment made
on direction given by Add./Jt. CIT
If appeal is against order of
reassessment-Original Assessment
Order
If appeal is against penalty-Relevant
assessment order
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By CA Mehul Shah

35. Paper Book
 The procedure of filing paper book is contained in Rule
18 of Income-tax Appellate Tribunal Rules.
 If the party to appeal before tribunal proposes to refer or
rely upon any document or statements or other papers
on the file referred to in the assessment orders, he may
submit a paper book.
 The additional evidence must be contained in separate
paper book
By CA Mehul Shah

36. 36
Requirement of Paper Book
Papers must be legible
Papers should be properly indexed
– generally ground wise then
descending order of dates.
Certified as a true copy by the party
or his authorised representative
By CA Mehul Shah

37. 37
Requirement of Paper Book
Relevance of each paper and
authority to whom it was filed must
be indicated in description of index.
Certification that papers contained
were filed before lower authorities
Additional evidence to be provided
in separate paper book
By CA Mehul Shah

38. Procedures in Hearing Appeal and
flow of presentation
Your arguments should be on the basis of grounds of
appeal
The person filing the appeal shall start. In case of cross
appeal, the person having more stake shall start
The opposite person has to rebut the facts
If it’s a covered matter, the relevant judgment to be
relied upon shall be cited and produced.
By CA Mehul Shah

39. Procedures in Hearing Appeal and
flow of presentation – Remember 4
Cs
Clarity
Conciseness
Correctness
Creative Thinking
By CA Mehul Shah

40. Meaning of some important
terms
 Quantum order
 Ex-parte order
 Stay Application
 Covered matter
 Telescoping
 Peak
By CA Mehul Shah

41. Some important issues
 Cash credits
 Low gross profits
 Valuation of closing stock
 Disallowance of personnel element in
Travelling expenses, telephone expenses
 Unaccounted bogus purchase
By CA Mehul Shah

42. Revised Form 3CD : CA Mehul
Shah
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QUESTIONS FROM THE AUDIENCE

43. In case of query ,
43
CA Mehul Shah
Mobile : 9723459572
E-mail : mehul@raseshca.com
Partner
Rasesh Shah and Assocaites
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International Taxation : CA
Mehul Shah

44. | 44
International Taxation : CA
Mehul Shah

45. ABOUT THE AUTHOR
Author, Mr. Mehul Rasesh Shah is a member of the
ICAI. He has pursued certificate Course in
International Taxation in the year 2012 conducted by
the ICAI. He has also completed his Diploma in IFRS
(ACCA, London) and Advanced Diploma in
Management Accounting (CIMA, London) in the year
2013. Currently he is handling many Appellate
proceedings including representation before the
Tribunal and Settlement Commission. He can be
reached at mehul@raseshca.com
International Taxation : CA
Mehul Shah
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