High Court quashes rejection of tax declaration forms under Vivad se Vishwas Act

The High Court of Gujarat allowed the petition challenging the rejection of Declaration Forms 1 and 2 under the Direct Tax Vivad se Vishwas Act, 2020. The Court found that the rejection was unjustified as the petitioner's appeal period had not expired by the specified date. The respondent's decision lacked proper application of the Act's provisions, leading to the Court quashing the rejection and directing acceptance of the petitioner's declaration. Compliance with tax payment requirements was mandated by a specified date.

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Issues:
Challenge to rejection of Declaration Form 1 and 2 under Direct Tax Vivad se Vishwas Act, 2020.

Detailed Analysis:
The petitioner, an individual, challenged the rejection of Declaration Form 1 and 2 under the Direct Tax Vivad se Vishwas Act, 2020 (VsV Act) by the respondent. The petitioner's income was determined at Rs. 32,04,281/- after scrutiny assessment, leading to appeals before the CIT(Appeals) and the Income Tax Appellate Tribunal (ITAT). The petitioner filed the Declaration Forms to resolve the tax dispute, but they were rejected due to an appeal filed after the specified date of 31.01.2020, as claimed by the respondent.

The respondent argued that the petitioner's appeal to the High Court lacked a Civil Application for condonation of delay, thus not meeting the Act's conditions. The respondent contended that the rejection of the Declaration Forms was justified under Section 4(6)(b) of the VsV Act. The respondent highlighted the chronological dates to support the rejection based on merit.

The Court considered the events' timeline and provisions of the VsV Act. It noted that the appeal's period of limitation should start from the receipt of the certified copy, which was in December 2020, not from the ITAT's decision date. As per Section 2(1)(a)(ii) of the Act, the petitioner's time for filing the appeal had not expired by 31.01.2020. The Court found that the rejection lacked proper consideration of Section 2(1)(a)(ii) of the VsV Act and Section 260(A)(2)(a) of the IT Act. Therefore, the petitioner qualified as an appellant under the Act.

Consequently, the Court allowed the petition, quashing the rejection of Form 1 and 2. It directed the respondent to accept the petitioner's declaration within three days and instructed compliance with tax payment requirements by 30.09.2021. The decision was made in favor of the petitioner, emphasizing the respondent's failure to apply the Act's provisions correctly.

Judgment Summary:
The High Court of Gujarat allowed the petition challenging the rejection of Declaration Forms 1 and 2 under the Direct Tax Vivad se Vishwas Act, 2020. The Court found that the rejection was unjustified as the petitioner's appeal period had not expired by the specified date. The respondent's decision lacked proper application of the Act's provisions, leading to the Court quashing the rejection and directing acceptance of the petitioner's declaration. Compliance with tax payment requirements was mandated by a specified date.

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