Tax Litigation & Legal Consulting

Category 1

Income Tax Litigation

Comprehensive representation for scrutiny, assessment, appeals, and dispute resolution

Assessment & Scrutiny Proceedings

Sections 143(2), 142(1), 148 proceedings

Overview

Income tax scrutiny assessment involves detailed examination of your return by the Assessing Officer. Professional handling of scrutiny proceedings from notice stage to assessment order is critical to minimize adjustments and protect your interests.

Types of Notices We Handle

Section 143(1)

Intimation from CPC
Prima facie adjustments
Mismatch corrections
Response/rectification

Section 143(2)

Scrutiny selection notice
Mandatory for assessment
Time-bound response
Case selection criteria

Section 142(1)

Inquiry notice
Information requisition
Document submission
Specific queries

Section 148/148A

Reopening of assessment
Income escaping assessment
Show cause opportunity
Objection filing rights

Assessment Types

Limited Scrutiny: Examination limited to specific issues flagged by CASS
Complete/Detailed Scrutiny: Comprehensive review of all aspects of the return
Faceless Assessment: E-proceedings through Income Tax portal without physical appearance
Best Judgment Assessment (Section 144): When taxpayer fails to comply with notices

Our Services

Notice analysis and response strategy formulation
Documentation preparation and submission
Written submission drafting with legal precedents
Virtual hearing representation on e-Proceedings portal
Assessment order review and next steps advisory

Critical Points

Valid 143(2) Notice: A valid Section 143(2) notice is a mandatory prerequisite for scrutiny assessment. Assessments completed without serving this notice can be challenged as invalid.

Appeals & Tribunals

CIT(A), ITAT, High Court, Supreme Court

Overview

The Income Tax Act provides a comprehensive appellate mechanism from the first appeal at CIT(Appeals) to the Supreme Court. Understanding the appeal hierarchy, time limits, and procedural requirements is essential for effective dispute resolution.

Appeal Hierarchy

Commissioner of Income Tax (Appeals) - CIT(A)

First appellate authority
Appeal in Form 35
Time limit: 30 days from order (extendable by 30 days)
Pre-deposit: Not mandatory for first appeal
Faceless appeal proceedings (largely)

Income Tax Appellate Tribunal (ITAT)

Appeal in Form 36
Time limit: 60 days from CIT(A) order
Final fact-finding authority
Filing fees based on income slab
Both assessee and department can appeal

High Court

Only on substantial question of law
Time limit: 120 days from ITAT order
Tax effect threshold for department appeals
Reference under Section 256 (rare)

Supreme Court

When High Court certifies case fit for appeal
Or via Special Leave Petition (SLP)
Final appellate authority
Tax effect threshold for department appeals

Our Services

Appeal grounds preparation and drafting
Statement of facts compilation
Written submissions and paper books preparation
Oral arguments and representation
Stay of demand applications
Cross-objection filing where applicable

Penalty & Prosecution Proceedings

Section 270A, 271, prosecution defense

Overview

Penalty proceedings are initiated separately from assessment proceedings and require independent defense. Understanding the distinction between under-reporting and misreporting, as well as available defenses, is crucial for effective penalty mitigation.

Penalty Sections We Handle

Section 270A - Under-reporting 50% of tax on under-reported income

Section 270A - Misreporting 200% of tax on misreported income

Section 271(1)(c) (till AY 2016-17) 100% to 300% of tax evaded

Section 271B - Tax Audit Default 0.5% of turnover or Rs.1.5 lakh

Section 271D/271E - Cash Violations Equal to loan/repayment amount

Section 271H - TDS Statement Default Rs.10,000 to Rs.1,00,000

Defense Strategies

Reasonable Cause (Section 273B): Demonstrating bona fide belief and reasonable cause for failure
Technical Defects: Challenging defective or vague penalty notices
No Concealment: Proving all particulars were disclosed in return
Debatable Issue: Where two views are possible, penalty not sustainable
Procedural Violations: Non-compliance with mandatory procedures

Immunity & Waiver Options

Section 270AA Immunity

Application within 1 month of assessment order
Pay tax and interest as determined
No appeal filed against quantum
Immunity from penalty proceedings

Section 273A Waiver

Application to Commissioner
Genuine hardship requirement
Aggregate limit considerations
Discretionary relief

Prosecution Defense

Section 276C: Wilful attempt to evade tax
Section 277: False statements in verification
Compounding: Application to Principal Chief Commissioner for compounding of offences
Defense strategy focusing on absence of mens rea (guilty mind)

Settlement & Dispute Resolution

DTVSV, DRP, Section 264 revision

Overview

Alternative dispute resolution mechanisms can provide faster and more certain outcomes than prolonged litigation. Understanding available options and eligibility criteria helps in making informed decisions about the best route for dispute resolution.

Direct Tax Vivad se Vishwas (DTVSV) Scheme

Purpose: Settlement of pending income tax disputes
Coverage: Disputes pending at various appellate forums
Benefits: Reduced settlement amount, complete waiver of interest and penalty
Exclusions: Prosecution cases, search cases (certain categories), foreign assets cases
Note: Scheme is launched periodically; check current availability and deadlines

Dispute Resolution Panel (DRP)

Eligibility

Foreign companies
Transfer pricing cases
Against draft assessment order
Not for penalty orders

Procedure

Objections within 30 days
9-month timeline for directions
Binding on Assessing Officer
Appeal only to ITAT (not CIT(A))

Benefits

No tax demand during proceedings
Department cannot appeal DRP order
Faster resolution than regular appeal
Expert panel review

Section 264 Revision

Application to: Principal Commissioner / Commissioner of Income Tax
Scope: Any order passed by subordinate authority (not just appealable orders)
Time Limit: 1 year from order date (or knowledge of order)
Benefit: Alternative remedy when appeal not filed or grounds missed
Limitation: Cannot be used if appeal is pending on same issue

Our Services

Eligibility assessment for settlement schemes
Settlement calculation and form preparation
DRP objection drafting and representation
Section 264 revision petition filing
Comparative analysis of dispute resolution options

Category 2

GST Litigation

Defense and representation for GST notices, appeals, audits, and special proceedings

Show Cause Notice (SCN) Defense

DRC-01, Section 73/74/74A proceedings

Overview

GST Show Cause Notices (SCNs) are issued when the department believes there is short payment of tax, wrong availment of ITC, or other compliance failures. Timely and well-drafted responses are essential to avoid adverse orders and minimize tax demands.

Types of SCN We Handle

DRC-01A (Pre-SCN)

Intimation before formal SCN
Opportunity to pay voluntarily
Response within 15 days (typically)
Can avoid full SCN process

DRC-01 (Show Cause Notice)

Formal demand notice
Response in Form DRC-06
30 days response time
Personal hearing opportunity

Section 73 (Non-Fraud)

Normal limitation (3 years)
No suppression/fraud alleged
Penalty: 10% or Rs.10,000
Interest applicable

Section 74 (Fraud Cases)

Extended period (5 years)
Fraud/suppression alleged
Penalty: 100% of tax
Prosecution possible

Common SCN Triggers

ITC Mismatch: GSTR-2B vs GSTR-3B discrepancies
Outward Supply Mismatch: GSTR-1 vs GSTR-3B differences
E-way Bill Issues: E-way bill vs return mismatch
Classification Disputes: Wrong HSN/SAC code or rate application
Refund Issues: Erroneous refund claims
Supplier Issues: Purchases from cancelled/suspicious dealers

Response Strategy

Detailed analysis of SCN allegations
Reconciliation statement preparation
Documentary evidence compilation
Written reply in Form DRC-06
Personal hearing representation
Legal precedents and case law research

Section 74A (New Provision)

W.e.f. FY 2024-25: Section 74A introduces a unified provision replacing separate sections for fraud and non-fraud cases. The distinction between 73 and 74 continues for periods prior to this.

GST Appeals

First Appellate Authority, GSTAT, Courts

Overview

The GST law provides a comprehensive appeal mechanism from the Adjudicating Authority to the Supreme Court. Understanding pre-deposit requirements, time limits, and procedural formalities is essential for successful appellate proceedings.

GST Appeal Hierarchy

First Appellate Authority (FAA)

Appeal in Form GST APL-01
Time limit: 3 months from order (+ 1 month condonable)
Pre-deposit: 10% of disputed tax
No power to remand (as per Supreme Court)
Must decide on merits

GST Appellate Tribunal (GSTAT)

Appeal in Form GST APL-05
Time limit: 3 months from FAA order
Additional pre-deposit: 10% (total 20%)
National Bench / State/Area Benches
Both assessee and department can appeal

High Court

On substantial question of law
Writ jurisdiction for procedural violations
Important constitutional matters

Supreme Court

Final appellate forum
Constitutional matters
Conflicting High Court judgments

Pre-Deposit Requirements

First Appeal (FAA)

10% of disputed tax
In addition to admitted tax
Mandatory for appeal admission
No interest on pre-deposit

Tribunal (GSTAT)

Additional 10% (total 20%)
Maximum cap: Rs.50 crore CGST + Rs.50 crore SGST
Must be paid before appeal filing
Refundable if appeal succeeds

Our Services

Appeal drafting and filing (APL-01, APL-05)
Statement of facts preparation
Pre-deposit calculation and payment assistance
Personal hearing representation
Stay application for disputed demand
High Court writ petition drafting

GST Audit & Inspection

ASMT-10 scrutiny, departmental audit

Overview

GST audit and scrutiny proceedings require careful handling to avoid escalation into demand proceedings. Professional representation during audits helps ensure proper documentation, timely responses, and effective management of audit queries.

Types of Proceedings

ASMT-10 Scrutiny (Section 61)

Return discrepancy notice
Response in ASMT-11
30 days + 15 days extension
If satisfied: ASMT-12 closure

Departmental Audit (Section 65)

Risk-based selection
Multiple FY coverage possible
Access to all records
Audit report issuance

Special Audit (Section 66)

Commissioner ordered
Conducted by CA/CMA
90 days (+ 90 extendable)
Cost borne by government

Inspection/Search (Section 67)

Intelligence-based
Seizure powers
Immediate representation critical
Statement recording

Common Audit Issues

ITC Reversals: Rule 42, 43 apportionment issues
Classification Disputes: HSN/SAC code application
Valuation Issues: Related party transactions, inclusions/exclusions
E-invoicing Compliance: IRN generation, cancellation
E-way Bill Compliance: Distance, validity, part-B updation
Invoice Matching: Supplier compliance impact

Our Services

Pre-audit preparation and document organization
Reconciliation statement preparation
Audit representation and query handling
ASMT-11 reply drafting
Post-audit follow-up and DRC-01 response (if issued)

Advance Ruling & Special Proceedings

AAR, refund rejections, registration issues

Overview

Special GST proceedings cover matters beyond regular assessment and appeal - including advance rulings for clarity on tax treatment, refund rejection appeals, registration issues, and detention/seizure matters. Each requires specialized handling based on specific procedural requirements.

Advance Ruling (AAR)

Purpose: Binding ruling on classification, rate, exemption, ITC eligibility
Application: Form ARA-01 with prescribed fee
Binding Nature: Binding on applicant and jurisdictional officer
Appeal: To AAAR (Appellate AAR) against unfavorable ruling
Validity: Until law changes or facts vary

Refund Rejection Appeals

Common Refund Types

Export refunds (with/without payment)
ITC accumulation due to inverted duty
Deemed export refunds
Excess payment refunds

Common Rejection Reasons

Documentation deficiencies
Time-barred claims
Mismatch with returns
BRC/FIRC issues

Registration Issues

REG-17: Show cause for registration cancellation - Response within 7 working days
REG-19: Final cancellation order if no response
REG-21: Revocation application for cancelled registration
REG-23: Appeal against revocation rejection
Suo-moto Cancellation: Defense against department-initiated cancellation

Other Special Proceedings

Detention/Seizure (MOV-06, MOV-07): Release of goods and conveyance
Anti-profiteering Complaints: Defense before NAA proceedings
Interest Disputes: Challenging interest computation
Transitional Credit (TRAN-1/TRAN-2): Legacy credit issues

Our Services

AAR application drafting and representation
AAAR appeal filing
Refund rejection appeal and rectification
Registration restoration applications
High Court writ petitions for procedural violations
Detention release assistance

Level	Income Tax	GST
First Appeal	CIT(Appeals)	First Appellate Authority
Time Limit	30 days from order	3 months from order
Pre-deposit	Not mandatory	10% of disputed tax
Tribunal	ITAT	GSTAT
Tribunal Time	60 days from CIT(A)	3 months from FAA
Tribunal Pre-deposit	Fee based on income	Additional 10% (total 20%)
High Court	Substantial question of law	Substantial question of law
Supreme Court	Final appeal	Final appeal

Notice Type	Section/Form	Response Time	Consequence of Non-Response
IT Scrutiny	Section 143(2)	As specified in notice	Best judgment assessment
IT Reopening	Section 148A	As specified (usually 7-30 days)	Assessment without hearing
IT Rectification	Section 154	4 years from order	Application time-barred
GST Scrutiny	ASMT-10	30 days + 15 extension	DRC-01 issuance likely
GST SCN	DRC-01	30 days (typically)	Demand order DRC-07
GST Reg. Cancel	REG-17	7 working days	Final cancellation

Tax Litigation & Legal Consulting

Strategic Defense for Tax Disputes

Income Tax Litigation

Assessment & Scrutiny Proceedings

Overview

Types of Notices We Handle

Assessment Types

Our Services

Critical Points

Appeals & Tribunals

Overview

Appeal Hierarchy

Commissioner of Income Tax (Appeals) - CIT(A)

Income Tax Appellate Tribunal (ITAT)

High Court

Supreme Court

Our Services

Penalty & Prosecution Proceedings

Overview

Penalty Sections We Handle

Defense Strategies

Immunity & Waiver Options

Prosecution Defense

Settlement & Dispute Resolution

Overview

Direct Tax Vivad se Vishwas (DTVSV) Scheme

Dispute Resolution Panel (DRP)

Section 264 Revision

Our Services

GST Litigation

Show Cause Notice (SCN) Defense

Overview

Types of SCN We Handle

Common SCN Triggers

Response Strategy

Section 74A (New Provision)

GST Appeals

Overview

GST Appeal Hierarchy

First Appellate Authority (FAA)

GST Appellate Tribunal (GSTAT)

High Court

Supreme Court

Pre-Deposit Requirements

Our Services

GST Audit & Inspection

Overview

Types of Proceedings

Common Audit Issues

Our Services

Advance Ruling & Special Proceedings

Overview

Advance Ruling (AAR)

Refund Rejection Appeals

Registration Issues

Other Special Proceedings

Our Services

Appeal Hierarchy Comparison

Notice Response Timelines

Governing Legal Framework

Income Tax

GST

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