SHWETAL RITTULBHAI VORA V. PRINCIPAL COMMISSIONER OF INCOME TAX I

SCA/10988/2021

AI Insights

The case revolves around the rejection of tax dispute resolution declarations filed by the petitioner under the Direct Tax Vivad se Vishwas Act, 2020. The petitioner, Shwetal Rittulbhai Vora, challenged the rejection of his declarations which were filed to resolve disputes related to the income tax assessment for the year 2008-09. The rejection was based on the grounds that the appeal before the High Court was filed after the one-year period from the ITAT's decision, which was not in compliance with the conditions set under the Vivad se Vishwas Act. However, the petitioner argued that the appeal was filed within the permissible time frame as the certified copy of the ITAT order was received late, and thus, the limitation period had not expired. The court found that the rejection of the declarations was not in accordance with the law, as the petitioner was still within the time limit to file an appeal against the ITAT's decision.

• Counselvise Citation: [2021] 140 COUNSELVISE.COM (IT) 749621 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 23-09-2021
• Assessment Year: misc
• Laws Referred To: Direct Tax Vivad se Vishwas Act, 2020, Direct Tax Vivad se Vishwas Rules, 2020, Income Tax Act, 1961
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: MAUNA BHATT
• Assessee Lawyers: MONAAL DAVAWALA
• Keywords: Direct Tax Vivad Se Vishwas Act; Income Tax; Limitation Period; Scrutiny assessment; Declaration Form Rejection
• Section: 143(3); 143(2); 260-A(2)(a)

Judgement Text

"C/SCA/10988/2021 ORDER DATED: 23/09/2021 IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 10988 of 2021 ========================================================== SHWETAL RITTULBHAI VORA Versus PRINCIPAL COMMISSIONER OF INCOME TAX I ========================================================== Appearance: MR MONAAL J DAVAWALA(6514) for the Petitioner(s) No. 1 MRS MAUNA M BHATT(174) for the Respondent(s) No. 1 ========================================================== CORAM: HONOURABLE MS. JUSTICE SONIA GOKANI and HONOURABLE MR. JUSTICE RAJENDRA M. SAREEN Date : 23/09/2021 ORAL ORDER (PER : HONOURABLE MS. JUSTICE SONIA GOKANI) 1. The petitioner is an individual who has approached this Court by way of the present petition under Article 226 of the Constitution of India challenging the rejection of Declaration Form 1 and 2 by the respondent on 12.04.2021 filed by the petitioner under Direct Tax Vivad se Vishwas Act, 2020 (hereinafter referred to as ‘the VSV Act’) read with the Direct Tax Vivad se Vishwas Rules, 2020 (hereinafter referred to as ‘the VsV Rules’). 2. The facts leading to the present petition are as follows: - 2.1. The return of income was filed by the petitioner Page 1 of 8 C/SCA/10988/2021 ORDER DATED: 23/09/2021 declaring the income of Rs. 5,01,080/- on 29.09.2008 for Assessment Year 2008-09. The case of the petitioner was subjected to scrutiny assessment and a notice under Section 143(2) of the Income Tax Act, 1961 (hereinafter referred to as ‘the Act’) was issued on 31.08.2009. The assessment order under Section 143(3) of the Act was passed by the Assessing Officer on 25.03.2010 and the total income of the petitioner was determined at Rs. 32,04,281/- after making various additions. 2.2. An appeal came to be preferred before the CIT(Appeals) which was partly allowed on 23.05.2012. The petitioner approached Income Tax Appellate Tribunal (hereinafter referred to as ITAT) vide ITA No. 1969/Ahd/2012 which was also partly allowed on 22.10.2019. 2.3. The certified copy of the order of the Tribunal was not served upon the petitioner for nearly eleven (11) months, as a result of which, the petitioner communicated to the Assistant Registrar of the Tribunal on 30.09.2020 and requested for the delivery of certified copy of the order to challenge the same before this Court. The copy eventually also received in the month of December, 2020 and the period for preferring appeal against the order of ITAT being 120 days, the same Page 2 of 8 C/SCA/10988/2021 ORDER DATED: 23/09/2021 was preferred within that period of 120 days. The Filing Stamp Number Tax Appeal No. 24287 of 2020 is pending. With the onset of Covid-19 pandemic in March, 2020 the judicial functioning of the Courts and Tribunals was extremely limited and the period of limitation was extended from 15.03.2020 and till the date of filing of this petition, the same has been extended. The Apex Court in Miscellaneous Application No. 665 of 2021 extended the same till 90 days from 15.03.2021. 2.4. On 17.03.2020, the Central Government passed VsV Act to provide for the resolution of the disputed amount of taxes and for matters connected therewith and incidental thereto. The petitioner with a view to resolve the dispute, had filed Declaration Form 1 and 2 as per Section 4 of the VsV Act and the same was rejected on the ground that the assessee preferred the appeal before the High Court on 30.10.2020 vide Stamp No. 2487 of 2020 which is after the lapse of one year from the date of order of ITAT and therefore, according to the respondent, appeal was not pending before the appellate authority as on the specified date i.e. on 31.01.2020. 2.5. According to the petitioner, the appeal was to be filed before the High Court, however, the certified copy of the Page 3 of 8 C/SCA/10988/2021 ORDER DATED: 23/09/2021 order of the ITAT was not available till 22.10.2020. Section 260(A)(2)(a) of the Act provides for 120 days of period of limitation from the date of communication of the order, for preferring the appeal. It is also the say of the petitioner that even if the certified copy of the order passed by the ITAT was available on 23.10.2019, the petitioner had time to approach the High Court till 20.02.2020 and therefore, the time of preferring the appeal had not expired on 31.01.2020. 3. Therefore, the petitioner is before this Court with the following prayers: - “(a) quash and set aside the impugned rejection at Annexure-A to this petition; and/or (b) direct the respondent to accept the application of the petitioner; and/or (c) pending the admission, hearing and final disposal of this petition, to stay further proceedings in the case of the petitioner; and/or (d) any other and further relief deemed just and proper be granted in the interest of justice; (e) to provide for the cost of this petition.” 4. Affidavit-in-reply, on issuance of notice, has been filed where the stand taken by the respondent is that the appeal came to be filed before this Court being F(Stamp) No. 24287 of 2020 on 30.10.2020 after a period of one year from the date of order which is passed on 22.10.2019 by the ITAT. Section Page 4 of 8 C/SCA/10988/2021 ORDER DATED: 23/09/2021 4(6)(b) of the VsV Act provides that the declaration filed shall be presumed not to have been made if the declarant violets any of the conditions referred in the Act. The petitioner was since not found eligible to avail the benefit, his declaration form along with the application had been rejected. There is no flaw in the decision making process and therefore, it is urged that this petition be summarily rejected. 4.1. According to the respondent, the petitioner has preferred appeal before this Court without filing Civil Application for condonation of delay as can be seen from the screen short and therefore, he has not satisfied the condition prescribed under the Act. The chronological dates have been referred to at para-4 to urge that the petition deserves the rejection on merit. 5. At the outset, the chronological dates and details furnished by the respondent in its affidavit are necessary to be referred to: - Sr. No. Dates Particulars 1. 29.09.2008 Return of Income filed declaring income at Rs. 5,01,080/- 2. 31.08.2009 Notice under Section 143(2) of the Income Tax Act, 1961 3. 25.03.2010 Assessment Order passed by the Assessing Officer determining the Page 5 of 8 C/SCA/10988/2021 ORDER DATED: 23/09/2021 income at Rs. 32,04,281/- 4. 23.05.2012 Appeal preferred before the CIT(Appeals) 5. 22.10.2019 ITAT Appeal and Order Pronounced 6. 31.01.2020 Specified Date u/s 2(1)(n) of the Act 7. 20.02.2020 Last date for filing appeal before this Hon’ble Court 8. 30.10.2020 F(Stamp) Tax Appeal No. 24287 of 2020 filed before this Hon’ble Court 9. December,2020 Certified copy received from ITAT 10. 17.03.2021 Declaration filed in Form 1 and 2 11. 12.04.2021 Rejection of application by the respondent no.1. 6. This Court has heard extensively the learned advocates on both the sides who have taken us through the various provisions of the VsV Act and VsV Rules as well as the peculiar facts of the instant case considering extreme urgency, matter is taken up for final hearing at the stage of admission. 6.1. Apt would be to refer to Section 2 of the VsV Act at this stage: - “2.(1) In this Act, unless the context otherwise requires,— (a) \"appellant\" means— (i) 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, before an appellate forum and such appeal or petition is pending as on the specified date; Page 6 of 8 C/SCA/10988/2021 ORDER DATED: 23/09/2021 (ii) a person in whose case an order has been passed by the Assessing Officer, or an order has been passed by the Commissioner (Appeals) or the Income Tax Appellate Tribunal in an appeal, or by the High Court in a writ petition, on or before the specified date, and the time for filing any appeal or special leave petition against such order by that person has not expired as on that date;” 6.2. Noticing from the chronology of the events that the appeal of the ITAT came to be decided on 22.10.2019, however, certified copy had been received in December, 2020, the period of limitation would start running from the date of receipt of certified copy as per Section 260(A)(2)(a) of the IT Act. Period of 120 days would not have been over on 20.02.2020 when the appeal came to be preferred. 7. The case of the petitioner would squarely fall under the scheme of the VsV Act particularly under Section 2(1)(a)(ii) being the appellant whose time for filing appeal had not expired on a specified date i.e. on 31.01.2020. Even without the certified copy having been received, which indeed was at a belated stage, the period of limitation for preferring the appeal before this Court was not over when the authority concerned chose to reject the application of the respondent on 12.04.2021. There appears to be total non-application of mind on the part of the respondent authority while rejecting the Page 7 of 8 C/SCA/10988/2021 ORDER DATED: 23/09/2021 application and declaration form 1 and 2 without much effort and on simple comprehension of its own provision under Section 2(1)(a)(ii) of VsV Act read with Section 260(A)(2)(a) of the IT Act, it was easy to grasp that on the specified date on 30.01.2020, the time for filing any appeal was still alive. Therefore, the petitioner would surely in the context of this VsV Act can be said to be the appellant and therefore this petition deserves to be allowed quashing and setting aside the rejection of Form 1 and 2 on the part of the respondent dated 12.04.2021. 8. Let the declaration of the petitioner be accepted by the respondent within three (3) days from the receipt of copy of this order and the petitioner shall follow the requirement of payment of tax as the last date is of 30.09.2021. All consequential actions shall follow in accordance with law on the part of the respondent. 9. The petition is accordingly allowed. (SONIA GOKANI, J) (RAJENDRA M. SAREEN,J) Bhoomi Page 8 of 8 "