VSN AND JEEVAN INFRA DEVELOPERS,PERURU PANCHAYAT V. DCIT., CENTRAL CIRCLE, TIRUPATHI

MA 25/HYD/2025

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The case involves M/s. VSN and Jeevan Infra Developers, who filed a Miscellaneous Application against the order of the Income Tax Appellate Tribunal, which had earlier dismissed their appeal as withdrawn. This withdrawal was initially to opt for the Vivad Se Vishwas Scheme (VSVS), which they later found they could not benefit from due to non-payment under Form 3. The assessee sought to revive the appeal, citing a failure to meet the VSVS requirements as a 'technical reason' for not adhering to the scheme's conditions. The Tribunal had to decide whether the delay in filing the MA could be condoned and whether the six-month limitation under section 254(2) applied to this case.

• Counselvise Citation: [2025] 140 COUNSELVISE.COM (IT) 772062 (ITAT-HYDERABAD)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 28-08-2025
• Appeal Filed By: Assessee
• Order Result: Allowed
• Assessment Year: 2009-2010
• Other Referred Cases: Mahesh Goud Voruganti v. ITO [2024] 158 taxmann.com 286, Vidya Shankar Jaiswal vs. The Income Tax Officer, Ward-2, Ambikapur in Special Leave Petition (Civil) Nos. 26310-26311/2024
• Laws Referred To: Income Tax Act
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SACHIN KUMAR
• Assessee Lawyers: H. SRINIVASULU
• Keywords: Condonation of delay; Period of limitation; Search and seizure; Rectification of order; Time period of passing order

Judgement Text

" आयकर अपीलीय अधिकरण, हैदराबाद पीठ IN THE INCOME TAX APPELLATE TRIBUNAL Hyderabad ‘B’ Bench, Hyderabad श्री रविश सूद, न् याययक सदस् य एवं श्री मिुसूदन सावडिया, लेखा सदस् य क े समक्ष । BEFORE SHRI RAVISH SOOD, JUDICIAL MEMBER AND SHRI MADHUSUDAN SAWDIA, ACCOUNTANT MEMBER M.A. No.25/Hyd/2025 आ.अपी.सं / In ITA No.707/Hyd/2017 (निर्धारण वर्ा/Assessment Year:2009-10) M/s. VSN and Jeevan Infra Developers, Peruru Panchayat, Tirupati. PAN:AAIFV3414B Vs. Dy. Commissioner of Income Tax, Central Circle, Tirupati. (Appellant) (Respondent) निर्धाररती द्वधरध/Assessee by: Shri H. Srinivasulu, Advocate. रधजस् व द्वधरध/Revenue by: Dr.Sachin Kumar, SR-DR सुिवधई की तधरीख/Date of hearing: 22/08/2025 घोर्णध की तधरीख/Pronouncement: 28/08/2025 आदेश/ORDER PER MADHUSUDAN SAWDIA, A.M.: This Miscellaneous Application (“MA”) has been filed by the assessee against the order of this Tribunal in ITA No.707/Hyd/2017 for the assessment year 2009–10 dated 15.07.2021, seeking revival of the appeal earlier dismissed as withdrawn in view of the assessee opting for the Vivad Se Vishwas Scheme, 2020 (“VSVS”). Printed from counselvise.com MA No.25/Hyd/2025 2 2. At the outset it is found that, the present MA has been filed belatedly. As per the record, the impugned Tribunal order was passed on 15.07.2021, whereas the assessee filed this MA on 29.03.2025, leading to a delay of more than 3 years. The assessee has also filed an affidavit explaining the reasons for such delay and praying for condonation. 3. The Learned Authorised Representative (“Ld. AR”) submitted that the assessee had filed Forms 1 and 2 under the VSVS, and accordingly withdrew its appeal before this Tribunal. Cosequently, the Tribunal dismissed the appeal of the assessee due to withdrawal and liberty was given to the assessee to seek revival of appeal in case the settlement benefit under VSVS was denied for technical reasons. Form 3 under the VSVS was issued to assessee on 29.09.2021, i.e., after the Tribunal order dated 15.07.2021. Since the assessee could not make the required payment under Form 3, the benefit of VSVS was not availed by the assessee. Consequently, the present MA has been filed by the assessee for revival of appeal. Printed from counselvise.com MA No.25/Hyd/2025 3 4. On the issue of limitation, the Ld. AR contended that the present case is not one of rectification of mistake under section 254(2) of the Act, but one of revival of appeal based on liberty granted in the Tribunal’s impugned order. Therefore, the six-month limitation under section 254(2) of the Act is not applicable. Reliance was placed on the judgment of the Hon’ble Telangana High Court in Mahesh Goud Voruganti v. ITO [2024] 158 taxmann.com 286 dated 12.10.2023, wherein it was held that when an appeal is withdrawn for availing VSVS with liberty to reinstate if the settlement fails, such an application for revival is not governed by the six-month limitation of section 254(2). Accordingly, the Ld. AR submitted that the case of the assessee is for revival of appeal and not rectification of mistake in the impugned order. 5. On the aspect of delay, the Ld. AR submitted that the Hon’ble Supreme Court in MA No. 21/2022 dated 10.01.2022 had extended limitation periods falling between 15.03.2020 and 28.02.2022 up to 31.05.2022. Since the Tribunal’s order dated 15.07.2021 falls within this extended period, the effective limitation period stood extended Printed from counselvise.com MA No.25/Hyd/2025 4 to 31.05.2022. However, the present MA has been filed with further delay. Therefore, after considering the period extended by the Hon’ble Supreme Court, the effective period of delay in the case of the assessee would be less than 3 years. Explaining the reasons, the Ld. AR referred to the affidavit filed, highlighting circumstances such as search and seizure operations, acute financial difficulties, disputes over immovable property, near closure of business, relocation of office from Tirupati to Hyderabad, departure of employees, and lack of familiarity of partners with tax procedures. He submitted that the delay was neither deliberate nor intentional, and prayed for condonation in the interest of justice. 6. Finally, the Ld. AR prayed before the bench for condonation of delay in filing the MA and for revival of the appeal. 7. Per contra, the Learned Departmental Representative (“Ld. DR”) strongly opposed the condonation of delay and revival of appeal. He submitted that the liberty granted by the Tribunal in its earlier order dated 15.07.2021 was specifically restricted to cases Printed from counselvise.com MA No.25/Hyd/2025 5 where the VSVS application was rejected on account of “technical reasons”. In the present case, the assessee failed to make the mandatory payment under Form 3. According to the Ld. DR, non- payment of tax is not a “technical reason”, but a substantive failure to comply with the scheme. Therefore, the condition precedent for revival of appeal is not satisfied. Further, the delay of more than two years and nine months in filing this MA is inordinate, and the assessee has failed to demonstrate sufficient cause for such delay. Accordingly, he prayed for dismissal of the MA. 8. We have carefully considered the rival submissions and perused the material available on record. The issues arising for our adjudication are (a) Whether the six-month limitation prescribed under section 254(2) of the Act applies to the present MA for revival of appeal or not ant (b) Whether the delay in filing the present MA deserves to be condoned or not. As far as the first issue, Whether the six-month limitation prescribed under section 254(2) of the Act applies to the present MA for revival of appeal is concerned, on Printed from counselvise.com MA No.25/Hyd/2025 6 perusal of the Tribunal’s earlier order dated 15.07.2021, it is clear that the assessee’s appeal was dismissed as withdrawn with a liberty to seek revival in case the VSVS benefit was denied for technical reasons. The present application has been filed pursuant to such liberty. Therefore, this is not a case of rectification of mistake in the Tribunal’s order, but one of revival of appeal based on liberty granted therein. In this context, we have gone through the judgment of the Hon’ble Telangana High Court in Mahesh Goud Voruganti v. ITO (supra), wherein it was held that the six-month limitation under section 254(2) is not applicable to an application for revival of appeal filed pursuant to liberty granted by the Tribunal. Respectfully following the said decision, we hold that the time limit under section 254(2) of the Act is not applicable in the present case. 9. As regard to second issue, whether the delay in filing the present MA deserves to be condoned is considered, it is undisputed that there is a delay of more than 3 years in filing this MA. The assessee has filed an affidavit explaining the reasons for delay, including search and seizure operations, acute financial difficulties, disputes Printed from counselvise.com MA No.25/Hyd/2025 7 over immovable property, near closure of business, relocation of office from Tirupati to Hyderabad, departure of employees, and lack of familiarity of partners with tax procedures. We have gone through the said affidavit and found that the reasons are bona fide and sufficiently explain the delay. Further, the Hon’ble Supreme Court in MA No. 21/2022 dated 10.01.2022 had extended the limitation period due to the Covid-19 pandemic. Therefore, after considering the period extended by the Hon’ble Supreme Court, the effective period of delay in the case of the assessee would be less than 3 years. Moreover, the principle laid down by the Hon’ble Supreme Court in the case of Vidya Shankar Jaiswal vs. The Income Tax Officer, Ward-2, Ambikapur in Special Leave Petition (Civil) Nos. 26310-26311/2024, dated 31st January, 2025 is that a justice- oriented and liberal approach should be taken while dealing with the application filed by an appellant seeking condonation of the delay in filing of the appeal. In view of the above, we are satisfied that the delay in filing this MA was neither deliberate nor intentional. Accordingly, the delay is condoned. Printed from counselvise.com MA No.25/Hyd/2025 8 10. Having held that the six-month limitation does not apply and the delay is condonable, we accept the assessee’s MA. Consequently, the appeal of the assessee stands revived. 11. In the result, the M.A. filed by the assessee is allowed. The Registry is directed to post ITA No.707/Hyd/2017 for hearing in due course. Order pronounced in the open Court on 28th Aug., 2025. Sd/- Sd/- (RAVISH SOOD) (MADHUSUDAN SAWDIA) JUDICIAL MEMBER ACCOUNTANT MEMBER Hyderabad. Dated: 28.08.2025. * Reddy gp Copy of the Order forwarded to : 1. M/s. Saket Engineers Pvt. Ltd., Unit 207, 2nd Floor, Ashoka Bhoopal Chambers, SP Road, Hyderabad-500003 2. ACIT, Central Circle 2(1), Hyderabad. 3. Pr.CIT (Central), Hyderabad. 4. DR, ITAT, Hyderabad. 5. Guard file. BY ORDER, Printed from counselvise.com "