Over ₹25 Lakh Crore Locked Up in Income‑Tax Disputes Across Appellate Levels, Centre Shares Data
The granular data suggest that while procedural reforms have been introduced, the structural backlog remains substantial, with significant implications for both taxpayers and the exchequer.
The Centre has disclosed that more than ₹25 lakh crore remains locked up in pending income‑tax disputes across various appellate levels, underscoring the scale of India’s direct‑tax litigation burden despite multiple rounds of reforms aimed at reducing disputes.
The data was shared by Minister of State for Finance Pankaj Chaudhary in response to an unstarred question in the Rajya Sabha, offering a five‑year snapshot of pendency before the first appellate authority, the Income Tax Appellate Tribunal (ITAT), High Courts, and the Supreme Court.
According to the figures, the first appellate authority [CIT(A)/JCIT(A)] continues to carry the heaviest load, with 5.39 lakh appeals pending at the end of FY 2024–25. The disputed amount at this stage alone stands at ₹16,75,45,696 lakh, translating to ₹16.75 lakh crore.
Complete Supreme Court Judgment on GST from 2017 to 2024 with Free E-Book Access, Click here
Pendency at this level has steadily increased from 4.48 lakh cases in FY 2020–21, reflecting the persistent pressure on the faceless appeals system and the limited disposal capacity relative to inflow.
At the ITAT level, pendency stood at 22,960 cases in FY 2024–25, involving disputes worth ₹3,64,45,449 lakh (₹3.64 lakh crore). While the number of pending appeals has fluctuated over the five years, the disputed amounts have remained consistently high, indicating that large‑value matters continue to dominate the tribunal’s docket.
The High Courts also show a rising trend in tax litigation. Pending appeals increased from 31,971 in FY 2020–21 to 34,486 in FY 2024–25, with the disputed amount escalating sharply to ₹5,65,15,885 lakh (₹5.65 lakh crore).
This reflects both the complexity of tax matters reaching constitutional courts and the broader issue of judicial backlog across High Courts nationwide.
At the Supreme Court, pendency rose from 5,567 cases in FY 2020–21 to 6,338 cases in FY 2024–25, with disputed amounts hovering around ₹25,40,351 lakh (₹0.25 lakh crore). While the apex court’s share of the total pendency is relatively small, the matters before it typically involve high‑stakes questions of law that shape tax jurisprudence.
Taken together, the data reveal that over ₹25 lakh crore is tied up in unresolved income‑tax disputes across all appellate levels. The figures highlight the fiscal implications of prolonged litigation, as large sums remain non‑recoverable until final adjudication.
They also underscore the challenges faced by the government in achieving its stated objective of reducing tax disputes through measures such as the Vivad se Vishwas scheme, faceless assessment and appeal mechanisms, and enhanced thresholds for departmental appeals.
The Ministry clarified that it maintains separate records for each appellate tier, covering the first appellate authority, ITAT, High Courts, and the Supreme Court. The granular data suggest that while procedural reforms have been introduced, the structural backlog remains substantial, with significant implications for both taxpayers and the exchequer.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
