The Delhi High Court has directed the NFAC to expedite the disposal of appeals to prevent prolonged delays. A roadmap has been drawn under the Central Action Plan 2024-25 to address the backlog efficiently.
The Delhi High Court has expressed serious concern over the growing backlog of more than 5.4 lakh pending appeals before the National Faceless Appeal Centre (NFAC). The NFAC was established under Sections 143 and 144 of the Income Tax Act, 1961, through the introduction of Section 144B under the Taxation and Other Laws (Relaxation and Amendment of Certain Provisions) Act, 2020, to streamline faceless tax assessments.
Court’s Concern Over Delays
A division bench comprising Chief Justice Devendra Kumar Upadhyaya and Justice Tushar Rao Gedela acknowledged the massive pendency of statutory appeals before the NFAC. The court noted that the very purpose of NFAC was to ensure timely resolution of tax-related appeals, and the current delays defeat that objective. Expressing dissatisfaction over the sluggish pace of appeal disposals, the bench has directed the NFAC to take immediate remedial measures and clear pending cases efficiently.
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Writ Petition Highlights Delay in Appeal Disposal
The issue came to light through a writ petition filed by a taxpayer whose income tax appeal has been pending before the Commissioner of Income Tax (Appeals) for over two years. The petitioner sought an expedited resolution, along with interest and compensatory costs for the prolonged delay. Additionally, the petitioner urged the court to issue guidelines to prevent harassment faced by taxpayers due to delays in appeal processing.
Government’s Response & Court’s Directives
During the hearing, senior counsel representing the Income Tax Department presented a roadmap formulated by the NFAC to resolve pending appeals within a fixed timeframe as per the Central Action Plan 2024-25. Acknowledging the roadmap, the Delhi High Court emphasized the need for NFAC to ensure strict implementation of these measures.
For the petitioner’s specific case, the court has ordered the NFAC to dispose of the appeal within eight weeks, setting a precedent for faster resolution of pending tax disputes.
Case Details
- Case Title: Suparshva Swabs (I) v. National Faceless Appeal Centre & Ors.
- Case No.: W.P.(C) 356/2025
- Petitioner’s Counsel: Advocate Mr. Sankalp Malik
- Respondents’ Counsel: Mr. Kushagra Kumar (SPC), Mr. Abhinav Bhardwaj (GP), Mr. Sunil Agarwal (SSC), along with Mr. Shivansh B. Pandey, Mr. Viplav Acharya, Ms. Priya Sarkar (JSC), and Mr. Utkarsh Tiwari
Key Takeaways
- The Delhi HC has directed the NFAC to expedite the disposal of appeals to prevent prolonged delays.
- A roadmap has been drawn under the Central Action Plan 2024-25 to address the backlog efficiently.
- The court has set an eight-week deadline for the disposal of the petitioner’s pending appeal.
The ruling underscores the judiciary’s commitment to ensuring a fair and timely appeal process for taxpayers, reinforcing the need for effective implementation of NFAC’s faceless appeal mechanism.
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