2020 (11) TMI 142 - HC - Income Tax

Benefit of Vivad Se Vishwas Scheme ('VVS Scheme') - Substantial Questions of Law framed for consideration on account of certain subsequent developments - Option to appeal in case application for settlement is rejected - HELD THAT - It may not be necessary for this Court to decide the Substantial Questions of Law framed for consideration on account of certain subsequent developments. The Government of India enacted the Direct Tax Vivad Se Vishwas Act, 2020 (Act 3 of 2020) to provide for resolution of disputed tax and for matters connected therewith or incidental thereto. The Act of the Parliament received the assent of the President on 17th March 2020 and published in the Gazette of India on 17th March 2020. In terms of the said Act, the assessee has been given an option to put an end to the tax disputes, which may be pending at different levels either before the First Appellate Authority or before the Tribunal or before the High Court or before the Hon'ble Supreme Court of India. The assessee is given liberty to restore this appeal in the event the ultimate decision to be taken on the declaration to be filed by the assessee under Section 4 of the said Act is not in favour of the assessee. If such a prayer is made, the Registry shall entertain the prayer without insisting upon any application to be filed for condonation of delay in restoration of the appeal and on such request made by the assessee by filing a Miscellaneous Petition for Restoration, the Registry shall place such petition before the Division Bench for orders. We direct the appellant / assessee to file the Form No.I on or before 09.11.2020 and the competent authority shall process the application / declaration in accordance with the Act and pass appropriate orders as expeditiously as possible preferably within a period of six (6) weeks from the date on which the declaration is filed in the proper form.

Summary

Issues:
1. Whether the Tribunal correctly assessed 75% of receipts under 'income from house property' and 25% under 'Income from business' without rationale?
2. Whether the Tribunal erred in not following previous decisions and if the current order is perverse?

Analysis:
1. The appeal was filed challenging the Tribunal's order on the assessment for the Assessment Year 2012-13. The appellant argued that the Tribunal incorrectly bifurcated the receipts without justification. The counsel for the respondent mentioned the intention to avail the Vivad Se Vishwas Scheme for resolving tax disputes.

2. The Court noted subsequent developments regarding the Direct Tax Vivad Se Vishwas Act, 2020, providing an option to resolve tax disputes. The Act defines disputed tax, outlines the process for declarants, and specifies the amount payable based on the provisions. Provisions under Sections 3, 4, 5, and 6 detail the declaration filing, payment, and immunity from penalties. Exceptions under Section 9 were also highlighted.

3. The Court granted the respondent the liberty to restore the appeal if the decision on the declaration under the Act is unfavorable. The respondent was directed to file Form No.I by a specified date, with the competent authority processing the application promptly. The Court disposed of the Tax Case Appeal with the mentioned liberty, leaving the Substantial Questions of Law open and without imposing any costs.