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IN THE HIGH COURT FOR THE STATE OF TELANGANA, HYDERABAD
UJJAL BHUYAN, A. VENKATESHWARA REDDY, JJ.
Mrs.Amina Khatoon - Petitioner
Vs.
The Union of India Rep. by its Secretary Ministry of Finance, New Delhi & 3 Others. - Respondents
W.P.No.28250 of 2021
Decided On : 06-01-2022
Constitution of India, 1950 - Article 14 - Income Tax Act, 1961 - Section 154, 2(i)(a), 2(1)(n), 2(1)(e), 2(1)(c), 2(1)(l) - Direct Tax Vivad Se Vishwas Act, 2020 - Section 2(1)(a)(i) , 2(1)(j)(B) , 5, 4, 6, 10 and 11 – Declarant - Designated authority - Whether taxpayer in whose case time limit for filing of appeal has expired but an application for condonation of delay has been filed is eligible - Whether taxpayer in whose case time limit for filing of appeal had expired - Whether such a taxpayer would be construed to be eligible.
Findings of the Court :
Court had thus taken view that when Income Tax Appellate Tribunal had accepted application for condonation of delay and had condoned delay, effect would be that appeal before Income Tax Appellate Tribunal would be construed to have been filed within time and limitation would relate back to date by which time appeal against order of first appellate authority ought to have been filed - Once it is considered that appeal before Income Tax Appellate Tribunal is deemed to have been filed within time, same would be construed as having been filed before specified date which in turn would mean that petitioner would have to be construed to be an appellant as defined in Section 2(1)(a)(i) of Vivad Se Vishwas Act - Rejection of declaration was not preceded by any notice or hearing - Though such notice or hearing is not provided under Section 5 of Vivad Se Vishwas Act, it is axiomatic that principles of natural justice, which is very essence of fairness, demands that before an adverse decision is taken affecting rights and liabilities of an aggrieved person, he ought to be put on notice and given an opportunity of hearing - Same having not been done in case, impugned decision suffers from violation of principles of natural justice which is one more reason why we are constrained to interfere with same - Designated authority has already disclosed his mind on merit of declaration in impugned order, we direct jurisdictional Principal Chief Commissioner of Income Tax to assign another designated authority to deal with declaration of petitioner - Let a fresh decision be taken by new designated authority on declaration of petitioner within a period of eight (08) weeks from date of receipt of a copy of this order.
Result - Writ Petition is disposed of.
ORDER :
Ujjal Bhuyan, J.
Heard Mr. Ch. Siddhartha Sarma, learned Counsel for the petitioner; Mr. B. Mukherjee, learned Counsel appearing on behalf of Mr. N. Rajeshwar Rao, learned Assistant Solicitor General of India, for 1st respondent; and Mr. K. Raji Reddy, learned Senior Standing Counsel, Income Tax Department, for respondent nos.1 and 2.
2. By filing this petition under Article 226 of the Constitution of India, petitioner seeks quashing of order dated 20.04.2021 passed by respondent no.2 rejecting the application of the petitioner dated 03.03.2021 for settlement of tax dues under the Direct Tax Vivad Se Vishwas Act, 2020, and further seeks a direction to the 2nd respondent 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 along with the condonation petition was taken up by the Income Tax Appellate Tribunal, it was submitted on behalf of the petitioner that petitioner would like to avail the benefit of the Vivad Se Vishwas Act. In that view of the matter, Income Tax Appellate Tribunal by the order dated 23.03.2021 condoned the delay in filing the appeal whereafter, petitioner was granted liberty to withdraw the appeal to avail her remedy under the Vivad Se Vishwas Act.
7. Petitioner filed declaration under the Vivad Se Vishwas Act on 03.03.2021 before respondent no.2. However, by the order dt.20.04.2021, the declaration was rejected.
8. Aggrieved, present Writ Petition has been filed.
9. Common counter-affidavit has been filed by respondent no.3 on behalf of all the respondents. Though contentions have been advanced disputing the eligibility of the petitioner for resolution of tax dispute under the Vivad Se Vishwas Act, however, respondents have supported the impugned decision of the respondent no.2 on merit as well. It is stated that on the specified date, i.e., on 30.01.2020 there was no appeal of the petitioner which was pending before the Income Tax Appellate Tribunal. It is further stated that though the specified date was subsequently extended to 04.12.2020 even then also there was no appeal pending as on that date. Therefore, petitioner was not eligible to make the declaration. Accordingly, respondent no.2 had rightly rejected such declaration of the petitioner.
10. Learned counsel for the petitioner has relied upon Circular No.21 of 2020 issued by the Central Board of Direct Taxes (C.B.D.T.) on 04.12.2020, more particularly, to the answer given to Question No.59 and also to a co-ordinate Bench decision of this Court in Boddu Ramesh vs. Designated Authority, 437 I.T.R. 32 to contend that rejection of the declaration of the petitioner on the ground that there was no appeal pending on the specified date is not correct. According to learned counsel for petitioner, when the delay in filing the appeal has been condoned by the Income Tax Appellate Tribunal it can only mean that the appeal was filed within time, and
Point of Law - 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 benefit is to....
Point of Law : Income Tax Act – Scheme "provide for resolution of disputed tax – Cut of date – Delay in making application - Scheme was intended to give a quietus to huge pending direct tax litigatio....
Taxation - Self-assessment tax - Assessment order - The ineligibility to file declaration relates to an assessment year in respect of which prosecution has been instituted on or before the date of de....
Income Tax - tax arrear - debarment must be in respect of tax arrear as defined - To hold that an assessee would not be eligible to file a declaration because there is a pending prosecution for asses....
The appeal is considered pending as soon as it is filed and does not require admission before the specified date under the Direct Tax Vivad Se Vishwas Act, 2020.
The court established that an appeal restored after the specified date can still be considered pending for the purposes of eligibility under the VSV Act.
The eligibility for the DTVSV Scheme is determined by the status of the appeal on the specified date, affirming that appeals deemed non-maintainable subsequently do not invalidate such eligibility.
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