Rules 194 and 195 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Rule 194 of the Income-tax Rules, 2026 prescribes Form No. 117 for a declaration under section 375 — in duplicate before the appellate Commissioner and in triplicate before the Appellate Tribunal. Rule 195 prescribes Form No. 118 for an Assessing Officer to apply under section 376 to defer filing an appeal.
Rule 194 — the section 375 declaration in Form No. 117
Rule 194(1) provides that the declaration referred to in section 375(1) shall be in Form No. 117, verified in the manner indicated in the form.
Rule 194(2) requires the declaration and the verification to be signed by the person specified in rule 167(3) — that is, the person authorised to verify the return of income under section 265.
Rule 194(3) prescribes the number of copies:
| Where furnished | Copies |
|---|---|
| To the Joint Commissioner (Appeals) or the Commissioner (Appeals) | Duplicate |
| To the Appellate Tribunal | Triplicate |
Rule 194(3) still specifies duplicate and triplicate filing. Where the forum accepts electronic filing, the practical reading is that the prescribed number of sets must be furnished in whatever manner the forum requires. Where physical filing is required, the count is literal — filing a single set before the Tribunal falls short of the rule. Check the forum's current practice before filing, and keep the prescribed sets ready.
It replaces rule 15A of the Income-tax Rules, 1962.
Rule 195 — deferring an appeal in Form No. 118
Rule 195 reads in full:
"The application referred to in section 376(2), required to be made before the Appellate Tribunal or the jurisdictional High Court, as the case may be, shall be made in Form No. 118 by the Assessing Officer."
Three features are worth drawing out:
- It is a departmental application. The Assessing Officer makes it — not the assessee.
- It lies before either the Appellate Tribunal or the jurisdictional High Court, depending on which forum the appeal would be to.
- Its purpose is to defer filing an appeal, not to withdraw or abandon one.
It replaces rule 16 of the Income-tax Rules, 1962.
Why deferral exists
Section 376 addresses the situation where the same question of law arises in a taxpayer's case for more than one year, or across taxpayers, and the department does not wish to litigate every instance while a lead matter is pending. Rather than filing protective appeals in every case, the Assessing Officer may apply to defer filing, with the deferred appeal following the outcome in the lead matter.
A deferral application under rule 195 means the department has not given up on the issue — it has parked it. A taxpayer who sees a Form No. 118 application in one year should assume the issue remains live for that year and should preserve records and positions accordingly, rather than treating the absence of an appeal as acceptance.
The appellate forms at a glance
| Rule | Purpose | Form | Old form | Filed by |
|---|---|---|---|---|
| 167 | Appeal to JCIT(A) or CIT(A) | 99 | 35 | Assessee |
| 193(1) | Appeal to the Appellate Tribunal | 115 | 36 | Assessee or department |
| 193(2) | Memorandum of cross-objections | 116 | 36A | Respondent |
| 194 | Declaration under section 375 | 117 | — | Assessee |
| 195 | Application to defer filing an appeal | 118 | — | Assessing Officer |
Compliance checklist
- Use Form No. 117 for a section 375 declaration, verified as the form indicates.
- Have it signed by the rule 167(3) / section 265 person.
- Furnish it in duplicate before the appellate Commissioner and triplicate before the Tribunal.
- Recognise Form No. 118 as a departmental deferral application and treat the underlying issue as live.
- Keep a single record of the section 265 signatory for every filing in the dispute.
Common mistakes
- Filing a single set of Form No. 117 before the Tribunal.
- Signature by someone other than the rule 167(3) person.
- Treating a deferral as the department dropping the issue.
- Expecting to file Form No. 118 as a taxpayer. It is made by the Assessing Officer.