2022 (5) TMI 51 - HC - Income Tax

Petition under Direct Tax Vivad se Vishwas Act, 2020 - 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 - HELD THAT - 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 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. 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

Summary

Issues:
Challenge to rejection of Declaration Form 1 and 2 under Direct Tax Vivad se Vishwas Act, 2020.

Detailed Analysis:
The petitioner, an individual, challenged the rejection of Declaration Form 1 and 2 under the Direct Tax Vivad se Vishwas Act, 2020 (VsV Act) by the respondent. The petitioner's income was determined at Rs. 32,04,281/- after scrutiny assessment, leading to appeals before the CIT(Appeals) and the Income Tax Appellate Tribunal (ITAT). The petitioner filed the Declaration Forms to resolve the tax dispute, but they were rejected due to an appeal filed after the specified date of 31.01.2020, as claimed by the respondent.

The respondent argued that the petitioner's appeal to the High Court lacked a Civil Application for condonation of delay, thus not meeting the Act's conditions. The respondent contended that the rejection of the Declaration Forms was justified under Section 4(6)(b) of the VsV Act. The respondent highlighted the chronological dates to support the rejection based on merit.

The Court considered the events' timeline and provisions of the VsV Act. It noted that the appeal's period of limitation should start from the receipt of the certified copy, which was in December 2020, not from the ITAT's decision date. As per Section 2(1)(a)(ii) of the Act, the petitioner's time for filing the appeal had not expired by 31.01.2020. The Court found that the rejection lacked proper consideration of Section 2(1)(a)(ii) of the VsV Act and Section 260(A)(2)(a) of the IT Act. Therefore, the petitioner qualified as an appellant under the Act.

Consequently, the Court allowed the petition, quashing the rejection of Form 1 and 2. It directed the respondent to accept the petitioner's declaration within three days and instructed compliance with tax payment requirements by 30.09.2021. The decision was made in favor of the petitioner, emphasizing the respondent's failure to apply the Act's provisions correctly.

Judgment Summary:
The High Court of Gujarat allowed the petition challenging the rejection of Declaration Forms 1 and 2 under the Direct Tax Vivad se Vishwas Act, 2020. The Court found that the rejection was unjustified as the petitioner's appeal period had not expired by the specified date. The respondent's decision lacked proper application of the Act's provisions, leading to the Court quashing the rejection and directing acceptance of the petitioner's declaration. Compliance with tax payment requirements was mandated by a specified date.