Section 250 of the Income Tax Act – Appeal Process Before CIT(A)

Tushar is a retailer (shopkeeper) and sells toys for ₹12,00,000. A customer once purchased a toy car only to realise that it was damaged. The customer requested to get their money back, but Tushar denied it. This did not make the customer happy, and he complained at the consumer forum.

• Problem: Tushar did not replace the faulty toy.
   
• Result: The consumer forum helped the customer get a refund.
   
• Lesson: Sellers must respect consumer rights.

Here’s a simple table to explain:
 

This case presents the reasons why consumer protection statutes, such as Section 250, are essential. They make buyers and sellers deal in an equal manner.

Importance of Section 250

Tushar is the owner of a small grocery. On a particular day, he sold biscuits (which were expired) to a customer. The customer became ill and filed a complaint with the authorities. According to Section 250, Tushar was fined, and he needed to buy new biscuits.

• Problem: Tushar sold expired food, harming the customer.
   
• Action: The law stepped in to protect the customer.
   
• Result: Tushar learned to check expiry dates and follow rules.

Here’s why Section 250 is important:
 

Key Lessons:
 

• Customers should get safe and genuine products.
   
• Sellers must follow the rules to avoid fines.
   
• The law keeps business fair for everyone.

With the help of Section 250, people trust the shops and dealers to remain honest.

Objectives of Section 250

Tushar had purchased a new phone in one of the shops, soon it broke down within two days. By the time he returned, the owner of the shop had not agreed to fix or exchange it. Tushar claimed under Section 250, and the shop had to replace him with a new phone.

• Problem: The shop sold a faulty phone and refused to fix it.
   
• Action: Section 250 helped Tushar get justice.
   
• Result: The shop had to obey the law and replace the phone.

Here are the main objectives of Section 250:
 

Key Points:
 

• Customers should not suffer because of bad products.
   
• Shops must take responsibility for what they sell.
   
• The law helps solve problems quickly and fairly.

With Section 250 in place, customers such as Tushar will make purchases without any fear.

TDS Rate Under Section 250

Tushar has a small company where he employs freelance employees. In the previous month, he paid a designer ₹50,000, and he failed to take the TDS deduction (Tax Deducted at Source). Being rigid to the rules, the tax department penalised him under Section 250.

• Problem: Tushar didn't deduct tax from payments as required by law.
   
• Action: The tax department charged a penalty for this mistake.
   
• Solution: Now, Tushar deducts 10% TDS before making any payments.

Here's how TDS works under Section 250:
 

Important Points:
 

• TDS helps the government collect taxes in advance.
   
• Deduct tax when making payments, not later.
   
• File TDS returns every quarter without fail.
   
• Penalty for not deducting TDS can be heavy.

Now Tushar saves 10% of each large payment and deposits the government. This leaves him out of fines.

Exemption Under Section 250

Tushar sells handcrafts at an online store. His total sales in the previous year were less than the taxable limit of ₹8,00,000. He was glad to know that he is eligible to be exempted under Section 250, and he does not have any obligation to pay any taxes.

• Situation: Tushar's small business earns below the threshold.
   
• Benefit: Qualifies for tax exemption.
   
• Result: Saves money, and he can reinvest in his business.

Here are the key exemptions under Section 250:
 

Important Notes:
 

• Exemptions help small businesses grow.
   
• Must maintain proper records to claim exemption.
   
• Different rules apply to different categories.
   
• Still, need to file returns even if exempt.

Tushar does not have to worry about paying taxes anymore since he concentrates on expanding his business so long as his sales remain below ₹10,00,000. He stores all receipts and bills just in case officials have to check.

Due Date and Compliance Requirements

Tushar missed the deadline to submit his GST return on the 20th of last month. He forcefully paid a late fee of ₹200. And he records these dates now:

• GST Return Due Date: 20th of next month
   
• TDS Payment Due Date: 7th of next month
   
• Income Tax Return: 31st July (normal cases)

Key compliance rules:
 

• File returns even if no business happened
   
• Pay taxes before the due dates
   
• Keep all bills and records for 6 years
   
• Update books regularly

Tushar has now installed phone alarms for all the tax dates so that he does not get penalties. This regularity saves him money and annoyance.

Practical Examples

Tushar purchased a fridge, and it does not cool after one week. The shop was not helpful. This is what he did:

• Read about Section 250 consumer rights.
   
• Wrote a complaint letter to the shop.
   

• Attached are the bill and warranty card.

   

• Sent a copy to the consumer forum.

What happened next:
 

• The shop called within 3 days.
   
• They repaired the fridge for free.
   
• Tushar got 1 1-year extra warranty.

Key lessons:
 

• Always keep bills safe.
   
• Know your rights as a customer.
   
• Complain properly in writing.
   
• Consumer laws protect you.

Tushar is now careful when purchasing products and does not discard any documents.

Conclusion 

The experiences of Tushar indicate why Section 250 in everyday life. The law also assisted him when his new phone quit working. He came to know the urgency of complying with the deadline when he failed to remember the tax due dates. These are indications that Section 250 is beneficial to the consumer and those business owners who are honest. It guarantees fair treatment to its customers in the purchase of the products.

To small businessmen like Tushar, it makes simple rules to abide by. The law establishes an equilibrium; the shops are required to deal with quality products, and the customers are supposed to inspect bills and warranties. These are some of the simple rules that should be understood so that people who might be like Tushar can not have problems and develop trust in business relations.

FAQs

What is Section 250?
Section 250 is a consumer protection law that helps customers get fair treatment when they buy faulty products or bad services. It makes shops and sellers responsible for their products.

Who can use Section 250?
Any customer who bought something that doesn’t work properly or wasn’t as promised can use this law. Even small shop owners must follow these rules.

What if a shop refuses to replace a faulty product?
You can complain to the consumer forum with your bill and details. The law forces the shop to either repair, replace, or refund your money.

Is there a time limit to complain?
Yes, you should complain within 2 years of buying the product. The sooner you act, the easier it is to solve the problem.

Do I need a lawyer to file a complaint?
No, you can write the complaint yourself. Just explain what happened clearly and attach your bill or warranty card as proof.

What if I lost my bill?
Without a bill, it becomes harder to prove your case. Always keep bills safe—take a photo or store them safely for future use.

Can I complain about bad service, too?
Yes, if you paid for a service (like repairs or deliveries) and it wasn’t done properly, Section 250 protects you.

What happens if the seller ignores the complaint?
The consumer forum can order the seller to fix the issue or pay you compensation. Ignoring the law leads to fines.

Does Section 250 apply to online shopping?
Yes, the same rules apply—whether you buy from a shop or online, sellers must deliver good products or refund you.

How long does it take to resolve a complaint?
It depends, but simple cases may take a few weeks. Keep all proof ready to speed up the process.

Apply for Loans Fast and Hassle-Free

Apply Now

About the Author

LoansJagat Team

We are a team of writers, editors, and proofreaders with 15+ years of experience in the finance field. We are your personal finance gurus! But, we will explain everything in simplified language. Our aim is to make personal and business finance easier for you. While we help you upgrade your financial knowledge, why don't you read some of our blogs?