2022 (2) TMI 943

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....f Rs. 27,960/-. The revenue authorities were of the opinion that petitioner's speculative and non-speculative transactions were required to be calculated separately and the turn over of the assessee was more than the threshold limit prescribed for compulsory audit under Section 44AB of the Income Tax Act, 1961 (for short ' the Act') still the assessee had not filed the audit report. With respect to the declared income the revenue had no dispute. However on account of above noted breach, proceedings for penalty under Section 271B under the Act were initiated. This culminated into a penalty order dated 26.06.2018 passed by the assessing officer imposing the penalty of Rs. 1,50,000/-. The assessee's appeal was dismissed by the CIT (appeals) on 07.05.2019. Against this order the assessee had filed the appeal before Income Tax Appellate Tribunal on 09.12.2020. Along with the appeal the assessee had also filed an application for condonation of delay. The delay was condoned by the tribunal by an order dated 28.01.2021. In the meantime the legislature framed the direct tax Vivad se Vishwas Scheme, 2020. It was brought into effect from 17.03.2020. This act contains provisions for settlem....

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.... subject to the provisions of the Act where a declarant has filed a declaration to the designated authority in accordance with the provisions of Section 4 in respect of tax arrear, notwithstanding anything contained in the Income Tax Act or any other law for the time being in force the amount payable by the declarant shall be as provided in the table in the said Section. The declaration as referred to in Section 3 has to be made before the designated authority in prescribed format as provided in Section 4(1) of the Act. As per sub-section (2) of Section 4 upon filing such declaration, any appeal pending before the Income Tax Appellate Tribunal or Commissioner (Appeals) in respect of disputed income or disputed interest or disputed penalty or fee and tax arrear shall be deemed to have been withdrawn from the date on which certificate under Section 3 and 4 has been issued by the designated authority. Section 5 of the Act pertains to time and manner of payment. Sub-section (1) of Section 5 provides that the designated authority shall within a period of 15 days from the date of receipt of the declaration by an order determine amount payable by the declarant. As per sub-section (2....

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....axpayer 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 time limit for filing appeal expired during the period from 1st April 2019 to 31st Jan, 2020 (both dates included in the period), and the application for condonation is filed before the date of issue of this circular, and appeal is admitted by the appellate authority before the date of filing of the declaration, such appeal will be deemed to be pending as on 31st Jan 2020." Perusal of the Act would show that as per Section 3 and 4 of the Act a declarant can file a declaration to the designated authority during the specified time upon which there would be reduction in the arrears of the tax, penalty, fee etc. as prescribed under the Act. The term "appellant" as noted earlier means a person in whose case an appeal or a writ petition or special leave petition has been filed either by him or by the income tax authority or by both, a person in whose case an order has been passed by the assessing officer or the CIT (Appeals) or Tribunal or by the High Court in a writ petition before a specified date a....

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....High Court has dealt with an identical situation and in a detailed judgment come to the following conclusions:- "30. It is to be noted that the date for filing of declaration under the Act of 2020 opting to avail the benefit of Scheme was originally notified as 30.03.2020, which was extended from time to time, including up to 31.12.2020. 31. Subsequently the time for filing declarations under the Act of 2020 was finally extended by Notification No.9/2021 dt.26.02.2021 up to 31.03.2021. So petitioners application filed on 08.02.2021, was with in time. 32. However, while providing answer to Q.No.59, in Circular No.21/2020 issued on 04.12.2020, the last date for filing declaration under the Act of 2020 was considered as 31.12.2020, as notified by the Government at the relevant point in time. 33. It is only on 31.12.2020, the time for filing declarations under the Act of 2020 was extended for further period. 34. In the answer provided to Q.No. 59 in circular No 21/2020, it is stated that even "if the limitation for filing appeal has expired before 31.01.2020, i.e., the 'specified date', if an application for condonation of delay is f....

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.... effect that the appeal before the Tribunal as having been filed in time, since, such condonation would relate back to the date by which time, the appeal against the order of CIT ought to have been filed by the petitioner. Once it is considered that the appeal before the Tribunal is deemed as having been filed in time, the same would have to be construed as having been filed before the "specified date", and thus, an appeal can be stated to be pending before the appellate forum and the petitioner would have to be considered as an 'appellant' as defined in Section 2(1)(a)(i) of the Act of 2020, and the tax as assessed would have to be considered as 'disputed tax', as defined under Section 2(1)(i)(B) of the Act of 2020. 41. Alternatively, it is to be noted that since, the last date for filing declaration had been extended up to 31.03.2021 and the Tribunal, having found cogent reasons to condone the delay and allowing the appeal filed by the petitioner and remitting the matter back to the CIT by its order dt.15.02.2021, would automatically revive and restore the appeal, which was dismissed by the CIT by his order dt.18.09.2019. Thus, by order of the Tribunal dt....

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....elay condoned by the appellate authority is that there was no delay at all in preferring the appeal and the appeal, which has been preferred by the petitioner would relate back to the original date of filing of appeal, which would in other words mean that under the VsV Act, the petitioner would fall into the bracket of the definition of appellant in whose case, the appeal preferred before the ITAT was pending as on the specified date i.e. 31.01.2020. It is also necessary to know that the last date for declaration was finalised as 31.03.2021 and in the case of the present petitioner, his declaration has been filed once delay was condoned before the was over. Had it been the case of the date of declaration having expired, prior to the delay having been condoned, answer possibly could be otherwise and not so simple, but, here the assessee's timely allowance of condonation of delay by ITAT on dated 23.02.2020 would not in any manner hamper his path of his case being considered under the VsV Act as an Appellant. 38 Resultantly, the petition is allowed, quashing and setting aside the order of rejection by the respondent authority on dated 30.03.2021. Consequently, the petiti....