AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2022 (1) TMI 943
X X X X Extracts X X X X
X X X X Extracts X X X X
....t to consider the said application of the petitioner in terms of the aforesaid Act. 3. Case of the petitioner is that she is an assessee under the Income Tax Act, 1961 (briefly, 'the Act' hereinafter). 4. For the Assessment Year 2008-09, the Assessing Officer, i.e., respondent no.4, passed an Assessment Order which was rectified on 05.03.2019 under Section 154 of the Act. Against the Assessment Order, as rectified, petitioner preferred an appeal before respondent no.3. However, by order dated 10.10.2019, the appeal was partly allowed. Assailing that part of the order of the first appellate authority, i.e., respondent no.3, petitioner filed further appeal before the Income Tax Appellate Tribunal at Hyderabad on 24.02.2021 which was registered as I.T.A.No.131/Hyd/2020. 5. In the meanwhile, Union of India enacted the Direct Tax Vivad Se Vishwas Act, 2020 (briefly, the 'Vivad Se Vishwas Act' hereinafter) providing for resolution of disputed tax and for matters connected therewith or incidental thereto. 6. Since there was delay of (443) days in preferring the said appeal before the Income Tax Appellate Tribunal, an application for condonation of delay was filed. When the appeal alon....
X X X X Extracts X X X X
X X X X Extracts X X X X
....he petitioner. He further submits that against the decision of this Court in Boddu Ramesh (1 supra), Income Tax Department has preferred Special Leave to Appeal Petition before the Supreme Court. However, he fairly submits that there is no stay order granted in the Special Leave Petition. 12. Submissions made by learned counsel for the parties have received the due consideration of the Court. 13. At the outset, we may advert to the reason for rejection of the declaration of the petitioner by respondent no.2 vide the order dated 20.04.2021. The same reads as under : "Application in Form 1 & 2 filed on 03.03.2021 claiming appeals pending before the ITAT towards disputed interest. The said appeals were filed on 24.02.2021 against the order of the CIT(A) dated 10.10.2019. As no appeal is pending as on specified date, i.e., 31.03.2020 and also as time to file appeal is expired, the assessee is not eligible and has to be treated as not a valid declarant as per DTVSV Act, 2020. Further it is noted that while the dispute in Form 1 & 2 is disputed interest, whereas as per the grounds of appeal filed before the CIT(A) and also ITAT (filed after specified date) the dispute is on the quant....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ses. Currently, there are 4,83,000 direct tax cases pending in various appellate forums, i.e., Commissioner (Appeals), ITAT, High Court and Supreme Court. This year, I propose to bring a scheme similar to the indirect tax, Sub Ka Vishwas for reducing litigations even in the direct taxes. Under the proposed Vivad Se Vishwas scheme, a taxpayer would be required to pay only the amount of disputed taxes and will get complete waiver of interest and penalty provided he pays, by 31st March, 2020. Those who avail the scheme after 31st March, 2020, will have to pay some additional amount. The scheme will remain open till 30th June, 2020. Taxpayers in whose cases appeals are pending at any level can benefit from this scheme. I hope the taxpayers will make use of this opportunity to get relief from vexatious litigation process." 18. From a perusal of the speech of the Hon'ble Finance Minister, as extracted above, it is seen that the Central Government was concerned by the huge pendency of direct tax cases in various appellate forums. Therefore, it was proposed to bring a scheme which was similar to the scheme introduced for resolution of indirect tax disputes, the purpose being for red....
X X X X Extracts X X X X
X X X X Extracts X X X X
....h cases is pending or has been paid; (b) the pending appeal may be against disputed tax, interest or penalty in relation to an assessment or re-assessment order or against disputed interest, disputed fees where there is no disputed tax. Further, the appeal may also be against the tax determined on defaults in respect of tax deducted at source or tax collected at source; (c) in appeals related to disputed tax, the declarant shall only pay the whole of the disputed tax, if the payment is made before 31st day of March, 2020 and for the payments made after 31st day of March, 2020, but on or before a date notified by the Central Government, the amount payable shall be increased by 10% of the disputed tax; (d) in appeals related to disputed penalty, disputed interest, or disputed fee, the amount payable by the declarant shall be 25 per cent of the disputed penalty, disputed interest or disputed fee, as the case may be, if the payment is made on or before 31st day of March, 2020. If the payment is made after 31st day of March, 2020, but on or before the date notified by the Central Government, the amount payable shall be increased to 30% of the disputed penalty, disputed interest, o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....n 3. 25. Referring back to Section 2(1)(e), we find that 'designated authority' has been defined to mean, "an officer not below the rank of a Commissioner of Income Tax notified by the Principal Chief Commissioner for the purposes of the Vivad Se Vishwas Act". 26. Under Section 2(1)(l), "last date" has been defined to mean, "such date as notified by the Central Government in the Official Gazette". 27. Section 5 provides for the designated authority dealing with the declarations so filed. As per Sub-Section (1) of Section 5, the designated authority shall, within a period of fifteen (15) days from the date of receipt of the declaration, by order, determine the amount payable by the declarant in accordance with the provisions of the Vivad Se Vishwas Act and grant a certificate to the declarant containing the particulars of the tax arrear and the amount payable after such determination. Sub-Section (2) of Section 5 says that the declarant shall pay the amount so determined within fifteen (15) days from the date of receipt of the certificate and inform the designated authority about the details of such payment. On receipt of such information, the designated authority shall pass an o....
X X X X Extracts X X X X
X X X X Extracts X X X X
....the Madras High Court in DCIT vs. M/s. Keyaram Hotels P. Ltd T.C.A.No.694 of 2019, dated 13.10.2020 (Madras High Court) and condoned the delay of (443) days in filing the appeal. After condoning the delay, the Tribunal proceeded to hear the appeal. However, in view of the submissions made by the assessee (petitioner) the appeal was dismissed as withdrawn with the clarification that if the assessee's case was not accepted by the Revenue under the Vivad Se Vishwas Act then the assessee would be at liberty to move the Tribunal for reinstatement of the appeal. 32. To remove various doubts as to applicability of the Vivad Se Vishwas Act, the Central Board of Direct Taxes (C.B.D.T.) issued Circular No.21 of 2020, dated 04.12.2020, explaining certain situations in the form of 'question and answer'. Question No.59 and the answer given thereto may have some bearing on the present dispute. 33. Question No.59 and the answer given thereto are extracted hereunder for ready reference, viz., "Q.No.59. Whether the taxpayer in whose case the time limit for filing of appeal has expired before 31st Jan 2020 but an application for condonation of delay has been filed is eligible? Answer. If the t....
X X X X Extracts X X X X
X X X X Extracts X X X X
....Finance Minister in her introductory speech read with the statements and objects of the Vivad Se Vishwas Act. 37. Moreover, we find that a similar issue had cropped up before a coordinate Bench of this Court in Boddu Ramesh (1 supra) where also the declaration of the petitioner dated 08.02.2021 was rejected on 31.03.2021 on the ground that the assessee had filed the appeal before the Income Tax Appellate Tribunal on 25.01.2021, thus, there being no appeal pending as on the specified date i.e., 31.01.2020. Accordingly, it was held that the declaration made was invalid and was rejected. We may mention that against the decision of the first appellate authority dated 18.09.2019, the said petitioner had preferred further appeal before the Income Tax Appellate Tribunal on 25.01.2021 along with an application for condonation of delay. The delay was condoned and the matter was remanded back to the first appellate authority vide order dated 15.02.2021. In the meanwhile, the said petitioner filed declaration under the Vivad Se Vishwas Act on 08.02.2021 which was rejected by the designated authority on 31.03.2021 in the following manner : "In this case the CIT(A) dismissed the appeal on 18....
X X X X Extracts X X X X
X X X X Extracts X X X X
....p to the date of issue of circular (ie. 04.12.2020) or even the date for filing declaration mentioned therein ((ie.) 31.12.2020, as there cannot be any differentiation in delay as it stands on the same footing be it of a day or more. 36. If Board circular is construed in such a restrictive manner, as is contended by respondents, the same would run contrary to the scheme of the Act of 2020 and the powers exercised by Board under Section 10 and 11 to issue directions or orders in public interest or to remove difficulties. 37. Therefore, we are unable to persuade ourselves to confine the benefit of "deemed pendency of appeal" only if an application for condonation is filed on or before 04.12.2020, as in our view no significance can be attached to the said date of issue of the circular, since, what is required to be considered is the pendency of the appeal with an application for condonation and the admission of the appeal as on the date of filing of declaration. 38. Thus, in our view, even after 04.12.2020, if an appeal is filed with an application for condonation of delay and the appeal is admitted by the appellate authority before the date of filing of the declaration, the ben....
X X X X Extracts X X X X
X X X X Extracts X X X X
....rm 1 and 2 on 31.03.2021 cannot be considered as 'invalid' and liable for 'rejection'. 43. Further, as noted above, the Act of 2020 is a beneficial piece of legislation and the benefit under such legislation should enure to the benefit of the assessee and cannot be denied by taking hyper-technical view. 44. In view of the above, this Court is of the considered view that the remark/reason given by the 1st respondent in rejecting the declaration in Forms 1 and 2 filed by the petitioner on 31.03.2021 as well as on 20.02.2021 cannot be sustained, as the said reasons are not inconsonance with the scheme of the Act and also do not confirm to the intent and purpose of the Legislation." 39. This Court had thus taken the view that when the Income Tax Appellate Tribunal had accepted the application for condonation of delay and had condoned the delay, the effect would be that the appeal before the Income Tax Appellate Tribunal would be construed to have been filed within time and the limitation would relate back to the date by which time the appeal against the order of the first appellate authority ought to have been filed. Once it is considered that the appeal before the....