W.P. (C) 1163/2021 Page 1 of 16

*

IN THE HIGH COURT OF DELHI AT NEW DELHI

%

Reserved on : 28^th July, 2022

Pronounced on

: 5^th August, 2022

W.P. (C) 1163/2021

KAPRI INTERNATIONAL PVT. LTD. (IN LIQUIDATION)

THROUGH LIQUIDATOR

..... Petitioner

Represented by: Mr.Rajesh Jain and

Mr.V.Tiwari,

Advocates.

versus

COMMISSIONER OF INCOME TAX - IV, NEW DELHI

.....Respondent

Represented by:

Mr.Kunal Sharma,

Sr. Standing Counsel

with Ms.Zehra Khan,

Mr.S.Bhattacharyya,

Advocates

CORAM:

HON'BLE MS. JUSTICE MUKTA GUPTA

HON'BLE MR. JUSTICE ANISH DAYAL

J U D G M E N T

ANISH DAYAL, J.

1.

By way of this writ petition, the petitioner (a Company in

liquidation, represented through the liquidator) assails the rejection

dated 5^th January, 2021 of From I and II filed by petitioner on 20^th

March, 2020 for the assessment years (AY) 1984-85 and 1985-86

under the Direct Tax Vivad Se Vishwas Act, 2020 (the VSV Act)

This is a digitally signed Judgement.

NEUTRAL CITATION NO: 2022/DHC/003086

W.P. (C) 1163/2021 Page 2 of 16

read with its Rules, 2020, by the Principal Commissioner of

Income Tax-IV, Delhi (CIT).

Factual Background:

2.

The petitioner is a company incorporated in India in the year

1972 for manufacture and export of readymade garments etc. On

1^st May, 1995, a winding up order for the petitioner was passed by

this Court in Company Petition No.59/1994. Prior to the winding

up order in 1987, the petitioner was assessed for Income Tax AY

1984-85 at Rs.89,53,788/-. Accordingly, in 2006, the Department

of Income Tax moved Company Application no.857/2006 under

Rule 9 of the Companies (Court) “Rules, 1959 read with Section

178 of the Income Tax Act” before this Court praying for

directions to attach rent received/receivablefor adjusting towards

the payment of Income Tax dues of the petitioner. However, this

application was dismissed as not being pressed.

3.

On 5^th November 2015, the Liquidator requested the

respondent-CIT to inform about the status of demand outstanding

against the petitioner under Income Tax Act and Wealth Tax Act.

On 27^th November, 2015, ITO Ward-14(I) informed that the total

demand

for

AYs

1984-85

to

1999-2000

amounted

to

Rs.19,06,496/- and the Wealth Tax to Rs.8,88,652/-, totalling as

Rs.27,95,148/-. On 17^th December, 2015, this Court directed the

liquidator to release this amount in favour of the Department and

granted liberty to the Liquidator to seek waiver of interest and

penalty.

This is a digitally signed Judgement.

NEUTRAL CITATION NO: 2022/DHC/003086

W.P. (C) 1163/2021 Page 3 of 16

4.

While the CIT accorded waiver of penalties on 28^th March,

2016 under Section 273 (A) (4), as regards the waiver of interest,

the petitioner filed an application under Section 220 (2A) before

the CIT for the AY 1984-85 and 1985-86 in March 2017. This

application for waiver of interest was rejected by the CIT on 26^th

February 2018. The petitioner then filed an application being Co.

Appl. 577/2019 disputing this rejection under Section 220 (2A) on

which this Court issued notice on 28^th May, 2019. However, the

matter is pending adjudication. In the meantime, on 17^th March,

2020, the VSV Act was notified by the Union of India to provide

for „resolution of disputed tax and formatters connected therewith

or incidental thereto‟. The Rules to be framed under the VSV Act

were also notified immediately thereafter.

5.

The petitioner chose to apply under the VSV Act providing

details of the amount payable under the VSV Act viz.

Rs.10,47,891/- for AY 1984-85 (against the disputed interest of

Rs. 41,91,567/-) and Rs.27,795/- for AY 1985-86 (against the

disputed interest of Rs.1,11,180/-).

6