Review petition against dismissed SLP qualifies as pending proceedings under Direct Tax Vivad Se Vishwas Act Section 2(1)(j)

Delhi HC held that a review petition pending against dismissed SLP constitutes "pending proceedings" under Direct Tax Vivad Se Vishwas Act, 2020, making the petitioner eligible for scheme benefits. Court relied on CBDT circulars clarifying that arbitration proceedings and miscellaneous applications qualify under Section 2(1)(j) even without pending appeals. HC emphasized that departments are bound by their own circulars and cannot take contrary positions. The restrictive interpretation by tax authorities was deemed inconsistent with the scheme's purpose of providing tax dispute resolution. Writ petition was allowed, directing acceptance of petitioner's declaration form for processing under DTVSV Act.

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Issues Involved:

1. Eligibility of the review petition as a pending appeal under the Direct Tax Vivad Se Vishwas Act, 2020 (DTVSV Act).
2. Interpretation of "pending appeal" under the DTVSV Act.
3. Applicability of CBDT circulars and clarifications.
4. Legislative intent and purpose of the DTVSV Act.

Detailed Analysis:

1. Eligibility of the Review Petition:
The primary issue was whether the review petition filed by the petitioner qualifies as a "pending appeal" under the DTVSV Act. The petitioner argued that the review petition should be considered an extension of the appeal process, and thus, should be eligible under the DTVSV Act. The court noted that although the scope of review is distinct from that of an appeal, the jurisdiction of the court includes the power to modify, review, or recall its own orders. Therefore, the Special Leave Petition (SLP) could not be considered final as the review petition was pending on the cutoff date.

2. Interpretation of "Pending Appeal":
The court examined the interpretation of "pending appeal" as defined in Section 2(1)(j) of the DTVSV Act. The respondent contended that no appeal, writ petition, or SLP was pending as of the specified date, making the petitioner ineligible. However, the court emphasized a broader interpretation, highlighting that the DTVSV Act aims to resolve disputes pending at various appellate and review stages. The court concluded that the review petition should be included within the definition of a pending appeal, thereby allowing the petitioner to avail the benefits of the DTVSV Act.

3. Applicability of CBDT Circulars and Clarifications:
The court referred to the Central Board of Direct Taxes (CBDT) circulars, which clarified that proceedings such as arbitration and miscellaneous applications pending on the cutoff date could meet the requirements of Section 2(1)(j). The court held that the department is bound by these circulars and cannot take a contrary position. The inclusion of arbitration proceedings and miscellaneous applications under the Vivad Se Vishwas Scheme indicated a relaxation of the strict interpretation of Section 2(1)(j), supporting the inclusion of the review petition as a pending proceeding.

4. Legislative Intent and Purpose:
The court underscored the legislative intent behind the DTVSV Act, which is to reduce tax disputes and generate timely revenue. The Act is characterized as a beneficial and remedial statute, designed to provide a mechanism for resolving pending income tax litigation. The court emphasized that a restrictive interpretation of the Act, as suggested by the respondent, would contradict the scheme's purpose. The court concluded that the Act intended to provide a resolution for disputes pending at various stages, including review petitions.

Conclusion:
The court allowed the writ petition, setting aside the impugned order that rejected the petitioner's declaration under the DTVSV Act. It directed the respondent to accept the revised declaration form filed by the petitioner and process it in accordance with the DTVSV Act, thereby recognizing the review petition as a pending appeal eligible for the scheme's benefits. The decision aligns with the Act's objective to settle disputes and facilitate timely revenue collection.

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