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2023 (11) TMI 130 - HC - Income TaxRectification u/s 254 seeking revival of appeal - petitioner could not pay the amount demanded by the Department vide Form-3 under DTVSV scheme within stipulated time - application for rectification of order of Tribunal rejected as not filed within a period of six months - HELD THAT - In considered opinion of this Bench, Section 254(2) of the Act has no application to the petition filed by the petitioner, which was filed for revival of the appeal. Therefore, rectification of an order and revival of an appeal are different and cannot be equated. Though there is delay on the part of the petitioner in approaching the Tribunal, in the considered view of this bench, the petitioner should be afforded an opportunity to pursue his appeal, to meet the ends of justice or else he would be rendered remedy-less. Since the application under Section 254(2) itself was not maintainable, using the inherent powers with the Tribunal, they should have treated the application u/s 254 (2) as one seeking revival of the appeal, in the light of the earlier order of the Tribunal dated 20.01.2021. The order passed by the Tribunal is set aside and consequently, the application under Section 254(2) is ordered to be treated as an application for revival of the appeal.
Issues involved:
The issues involved in the judgment are the application of Section 254(2) of the Income Tax Act, the dismissal of an appeal by the Tribunal under the Direct Taxes Vivad Se Vishwas Scheme, and the subsequent challenge to the Tribunal's order in a writ petition. Application of Section 254(2) of the Income Tax Act: The petitioner, an income tax assessee, filed a writ petition challenging the order of the Tribunal dated 11.07.2023, which dismissed the petitioner's application seeking to recall an earlier order and revive an appeal. The petitioner had approached the Tribunal after being unable to pay the demanded amount under the Direct Taxes Vivad Se Vishwas Scheme. The petitioner argued that the Tribunal erred in relying on Section 254(2) of the Income Tax Act, contending that the application for revival of the appeal should not be bound by the time limit specified under this section. The petitioner emphasized that the Tribunal had previously granted liberty to reinstate the appeal if the DTVSV scheme application was rejected, indicating that the order of dismissal was erroneous. Dismissal of Appeal under the Direct Taxes Vivad Se Vishwas Scheme: The petitioner had filed an application under the DTVSV scheme and received a demand from the Income Tax Department. However, due to circumstances, the petitioner could not pay the demanded amount within the stipulated time. Subsequently, the petitioner sought to recall the Tribunal's earlier order and revive the appeal. The Tribunal dismissed the application, citing the time limit for rectification under Section 254(2) of the Act and the mandatory dismissal of appeals under the DTVSV scheme upon issuance of Form No. 3. The respondent argued that the petitioner's delay in compliance and approach to the Department and Tribunal warranted the dismissal of the application. Judgment and Decision: Upon hearing both parties, the Court found that the application under Section 254(2) was not maintainable for revival of the appeal. The Court opined that the rectification of an order and revival of an appeal are distinct and should not be equated. Recognizing the delay on the petitioner's part, the Court held that the petitioner should be given an opportunity to pursue the appeal to ensure justice. The Court set aside the Tribunal's order and directed that the application under Section 254(2) be treated as an application for revival of the appeal. Consequently, the appeal was restored, and the Appellate Tribunal was instructed to expedite the disposal of the appeal in accordance with the law. Conclusion: In conclusion, the High Court set aside the Tribunal's order dismissing the petitioner's application and directed the revival of the appeal under the Direct Taxes Vivad Se Vishwas Scheme. The Court emphasized the distinction between rectification under Section 254(2) and revival of an appeal, granting the petitioner the opportunity to pursue the appeal for a just resolution.
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