Sub-section (1) gives a right of appeal to the High Court from every order passed in appeal by the Appellate Tribunal, but only where the High Court is satisfied that the case involves a substantial question of law. Sub-section (2) says who may appeal — the Principal Chief Commissioner, Chief Commissioner, Principal Commissioner, Commissioner or an aggrieved assessee — and fixes the form and time: a memorandum of appeal precisely stating the substantial question of law, filed within one hundred and twenty days from the date the order appealed against is received; sub-section (3) lets the High Court admit a late appeal on sufficient cause. Sub-sections (4) to (6) govern the hearing: the High Court formulates the question, the appeal is heard only on the question formulated, the respondent may argue that the case involves no such question, and the court retains power, for reasons recorded, to hear the appeal on another substantial question of law it has not formulated. Sub-section (7) requires a reasoned judgment on the question formulated and allows costs, sub-section (8) lets the High Court determine an issue the Tribunal has not determined or has wrongly determined by reason of its decision on the question of law, sub-section (9) applies the Code of Civil Procedure, 1908 so far as may be, and sub-section (10) requires the Assessing Officer to give effect to the judgment on the basis of a certified copy.
Why it is there
The section limits second appeals from the Tribunal to questions of law of substance, leaving findings of fact with the Tribunal, and confines the hearing to a question the court has itself formulated so that the scope of the appeal is fixed at the outset. Sub-sections (6) and (8) preserve enough flexibility that a genuine legal issue is not lost because it was not formulated or was not determined below.
Who it applies to
An assessee aggrieved by an order passed by the Appellate Tribunal
The Principal Chief Commissioner, Chief Commissioner, Principal Commissioner or Commissioner
The High Court
The Assessing Officer, in giving effect to the judgment
The figures, and what each one turns on
Read the condition in the same row. A figure quoted without it is a wrong answer with a citation attached.
What
Figure
The condition on it
Where
Time to file an appeal to the High Court
One hundred and twenty days
From the date on which the order appealed against is received by the assessee or by the Principal Chief Commissioner, Chief Commissioner, Principal Commissioner or Commissioner — receipt, not the date of the order
365(2)(a)
Extension of that period
No outer limit stated
The High Court may admit an appeal after the one hundred and twenty days if satisfied there was sufficient cause for not filing in time
365(3)
What this means in practice
The one hundred and twenty days runs from receipt of the Tribunal's order, so the date of receipt has to be recorded and provable; a later filing needs the court to be satisfied on sufficient cause. The memorandum must state the substantial question of law precisely, because the appeal will be heard only on the question the court formulates from it, and the respondent is entitled at the hearing to argue that no such question arises at all. A question not formulated is not necessarily shut out — sub-section (6) allows the court to hear it for reasons recorded — and the court can go further under sub-section (8) and decide an issue the Tribunal left undetermined or decided wrongly because of its view of the law. Once judgment is delivered, the Assessing Officer gives effect to it on a certified copy, so obtaining the certified copy is the step that moves the assessment.
An example
Illustrative only, and invented for this page. The figures are chosen to show the rule biting, not taken from any real matter.
An assessee receives the Appellate Tribunal's order on 1 June and files in the High Court on the 130th day after receipt. The appeal is out of time, because sub-section (2)(a) counts one hundred and twenty days from the date the order was received and not from the date the Tribunal made it, and it survives only if the court is satisfied under sub-section (3) that there was sufficient cause for not filing in time. Even filed in time, a memorandum that does not state the substantial question of law precisely is at risk: the court formulates the question, the appeal is heard only on the question so formulated, and the respondent is entitled at the hearing to argue that the case involves no such question at all. If the assessee wins, the assessment does not move on the judgment alone — sub-section (10) has the Assessing Officer give effect to it on the basis of a certified copy.
Where you meet this section
In the memorandum of appeal filed in the High Court against an order of the Appellate Tribunal, whether by the assessee or by the Principal Chief Commissioner, Chief Commissioner, Principal Commissioner or Commissioner, and afterwards in the certified copy of the judgment produced to the Assessing Officer so that effect can be given to it.
The words themselves
filed within one hundred and twenty days from the date on which the order appealed against is received by the assessee or the Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner
Section 365(2)(a), Income-tax Act, 2025.
What people get wrong
Counting the one hundred and twenty days from the date of the Tribunal's order. Sub-section (2)(a) runs it from the date the order is received.
Filing a general memorandum. Sub-section (2)(b) requires the substantial question of law to be stated precisely, and the hearing under sub-section (5) is confined to the question formulated.
Assuming an appeal lies on the facts. Sub-section (1) allows the appeal only where the High Court is satisfied the case involves a substantial question of law.
Assuming an unformulated question is lost. Sub-section (6) preserves the court's power to hear the appeal on another substantial question of law, for reasons to be recorded.
What this replaced
The correspondence is the Income Tax Department’s own, from its comparison utility for the 1961 and 2025 Acts. A renumbering is the easy half; whether the words changed is the half that decides cases.
A circular binds the department, not you and not a court. Every one below was written under the 1961 Act; it reaches this section because the department’s own concordance carries the provision it names to this one.
Circular No. DIT(L&R)-I/NZ/SLP/393/2011/5091 — Section 260A of the Income-tax Act, 1961 - High Courts, Appeals to - Summary Dismissal of Departmental Appeal by Delhi High Court 2011-09-16
Read this before you rely on it. Every decision below was decided under the Income-tax Act, 1961. It appears here because it is tagged to a 1961 provision that the department’s own mapping carries to section 365. That is an inference we have drawn, not a holding on the new section: where the words changed in the move, the reasoning may not survive. Treat this as the place to start looking, not as authority on the 2025 Act.
CIT v P. MohanakalaSupreme CourtHelps departmenttagged s.260A You gave particulars, paid by cheque and got a confirmation. Has the burden shifted?
CIT v Reliance Telecom LtdSupreme CourtHelps departmenttagged s.260A The Tribunal recalled its whole order on my miscellaneous application. Will that recall survive?
Mansarovar Commercial P Ltd v CITSupreme CourtHelps departmenttagged s.260A My company is registered outside the taxable territory but run from Delhi. Where is it resident?
PCIT v Ramesh Chandra RaiSupreme CourtHelps taxpayertagged s.260A The AO has added my share of the syndicate's profit straight to my own return. Can he do that without assessing the syndicate?
Sanjeev Lal v CITSupreme CourtHelps taxpayertagged s.260A A court order delayed my sale deed. Does my s.54 exemption run from the agreement to sell?
Snowtex Investment Ltd v PCITSupreme CourtHelps departmenttagged s.260A Can I set my share trading loss off against my f&o profits?
CIT (Exemptions) v Audyogik Shikshan MandalHigh CourtHelps taxpayertagged s.260A Trust funds went to a trustee. Does the trust lose exemption on all its income or only that amount?
CIT v Girish ChaudharyHigh CourtHelps taxpayertagged s.260A A seized loose sheet has the bare figure '48' on it and the officer has assessed Rs 48 lakhs. Can he read the scale into the entry like that?
CIT v Pruthvi Brokers & ShareholdersHigh CourtHelps taxpayertagged s.260A Goetze says I cannot make a claim except by revised return. Does that stop me raising it before the CIT(A) or the Tribunal?
CIT v SPL Infrastructure P LtdHigh CourtHelps taxpayertagged s.260A My sub-contractors did not answer summons. Can the Assessing Officer disallow the whole payment to them?
Coromondel Cabeles (P) Ltd v ACITHigh CourtCuts both waystagged s.260A I never claimed section 80-ib(10) in my return under section 139(1). Can the High Court still let me have the deduction in a section 260A appeal?
Godaddy.Com LLC v ACITHigh CourtHelps taxpayertagged s.260A We pay a foreign registrar to register our domain names. Is that royalty, and must we withhold?
PCIT v Best Infrastructure (India) P LtdHigh CourtHelps taxpayertagged s.260A The share capital addition rests on a statement I was never allowed to cross-examine. Does it stand?
PCIT v DSG Papers (P) LtdHigh CourtHelps taxpayertagged s.260A The addition rests on statements of ex-employees and third parties I was never allowed to question. Is the assessment good?
PCIT v Drisha Impex (P) LtdHigh CourtHelps departmenttagged s.260A The Tribunal gave me a small percentage addition on disputed purchases. Can the department get the whole disallowance back on appeal?
PCIT v Kanak Impex (India) LtdHigh CourtHelps departmenttagged s.260A The officer says my purchases are accommodation entries. Can he add the whole purchase, or only a percentage?
PCIT v Maahi Milk Producer Co LtdHigh CourtHelps taxpayertagged s.260A I pay a dairy to process my milk. Do I deduct 2% under 194C or 10% under 194J?
PCIT v Ojjus Medicare P LtdHigh CourtCuts both waystagged s.260A How do I count the six and the ten assessment years for a s.153C notice, and does the Rs 50 lakh figure have to be met year by year?
PCIT v Rajesh Suresh ChopraHigh CourtHelps taxpayertagged s.260A If an estimate on the disputed purchases cannot be avoided, is there a High Court figure I can point to?
PCIT v Shree Madhi Surali VibhagHigh CourtHelps taxpayertagged s.260A Our co-operative credit society took and repaid cash from its members and the appellate authorities deleted the 271D and 271E penalties on reasonable…
PCIT v Texport Overseas P LtdHigh CourtHelps taxpayertagged s.260A Clause (i) of s.92BA was omitted in 2017. Is the TPO adjustment for an earlier year still good?
Raj Kumar Bothra v DCITHigh CourtHelps taxpayertagged s.260A CPC disallowed my late-deposited pf and esi under 143(1)(a). Was a summary adjustment even open to them?
Ranbaxy Laboratories Ltd v CITHigh CourtHelps taxpayertagged s.260A Same point, in Delhi: if the recorded grounds fail, can the officer still tax an unrelated item?
Shivani Madan v PCITHigh CourtHelps taxpayertagged s.260A My husband and I are both on the sale deed. Must half the annual value be taxed on me?
State Bank of India v ACIT (TDS)High CourtHelps departmenttagged s.260A Staff booked a consolidated package tour with a foreign leg. Can we exempt the Indian part as ltc?
Vaduganathan Talkies v ITOHigh CourtHelps departmenttagged s.260A The purchases are genuine and I can name every payee. Does that answer a s.40A(3) disallowance?
Williamson Financial Services Ltd v CITHigh CourtHelps taxpayertagged s.260A The officer says the 2022 Explanation to s.14A is clarificatory and applies to my old years. Is there High Court authority against that?
What this page does not tell you. It does not reproduce the section. Everything above was written from the section’s own text as the Income Tax Department publishes it — the text is here, and nothing here is advice on your facts. Where a figure matters, read the sub-section it comes from.