Should You File an Appeal While Your Rectification Application Is Pending?

by Vikash Agarwal

A taxpayer may be willing to file a rectification application (ROM) against an order passed by the AO, however, the question that may arise is what if the ROM is not disposed off by the AO within the limitation period stipulated for filing the appeal?

Sometimes, an assessee chooses to appeal despite a strong case for filing a Review Application (ROM). The fear is that if the ROM is rejected and the appeal’s limitation period expires, the assessee will have no recourse against the original order.

I personally believe that there is no need to file an appeal in case the assessee has already preferred an ROM, at best, there could be the below possibilities once the ROM is filed;

📌 ROM Allowed: If the ROM is granted (i.e., the prayer is accepted), there’s no need to file an appeal. The issue is resolved in favor.

📌📌ROM Rejected: In case the ROM is declined, an appeal can still be filed against the original order. The time spent pursuing the ROM before the AO is excluded from the appeal period under Section 14 of the Limitation Act*

📌📌📌 New Ground/Demand: Sometimes, the ROM results in a new ground or demand. In such cases, the limitation for filing an appeal should run from the date of the revised order, not the original one, applying the doctrine of merger**

*wmp-18557/21(MHC)
**(2000)6SCC359