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TMI Blog2021 (9) TMI 704X X X X Extracts X X X X X X X X Extracts X X X X ..... Petitioner, any action on the same entailing adverse consequences, ought to have been afforded with a fair and reasonable opportunity to explain its case, which the Revenue has ex-facie failed to offer. We set aside the order of rejection dated 26th March 2021 and direct the Respondent No.1 Designated Authority, after giving a proper opportunity of hearing to Petitioner and after considering the submissions made/to be made by Petitioner, to pass an appropriate reasoned speaking order within two weeks from the date of pronouncement of this order. - WRIT PETITION (L) NO. 10336 OF 2021 - - - Dated:- 12-7-2021 - SUNIL P. DESHMUKH ABHAY AHUJA, JJ. Mr. Percy Pardiwalla, Senior Advocate i/b Mr. Atul Jasani, for the Petitioner. Mr. Suresh Kumar, Advocate for the Respondents-Revenue. PER COURT: 1. By this Petition filed under Article 226 of the Constitution of India, 1950, Petitioner challenges revocation of Form 3 issued by Respondent No.1, Designated Authority and rejection of the Petitioner s application under the Direct Tax Vivad Se Vishwas Act, 2020 (the DTVSV Act ) for assessment year 2011-2012 by Respondent No.1. 2. Petitioner had filed a Return of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 7,02,21,449/-. 5. Thereafter, on 4th December 2020 circular No.21/2020 and on 23rd March 2021 circular No.4/2021 was issued by CBDT. On 23rd March 2021 itself, Petitioner received an email from Respondent No.2 to show cause as to why Petitioner s case should not be treated as a Search Case and to explain the applicability of Section 9 of the DTVSV Act purportedly stating that the disputed tax purportedly exceeded ₹ 5 Crores. The said email reads thus:- From: Mumbai.dcit.cen8.4 Date: Tue, Mar 23, 2021 at 4.40 PM Subject: VSV in the case of Mahendra Corporation 2011-12 To: Nidhi Shah With regard to VSV filed in the case of Mahendra Corporation for AY 2011-12, it is seen that the assessment was completed on the basis of information received from Investigation Wing in relation to search conducted in the case of Mahendra Corporation and others. In this regard, you are requested to explain the applicability of Section9 of the Direct Tax vivad Se Vishwas Act 2020 in your case as the disputed tax exceeds ₹ 5 Cr. Your reply must reach this office with 3 days. Regards, DEBANJALI AMBULY DCIT(CC)-8(4), MUMBAI 6. Soon thereafter, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the application to be valid, he is required to determine the amount payable and issue Form 3 as prescribed under the rules under Section 5(1) of the DTVSV Act within a period of 15 days. Learned Senior Counsel submits that in this case in terms of the DTVSV Act, Petitioner has received Form 3 determining the amount to be paid by Petitioner. Petitioner has made payments of ₹ 10,70,28,372/- on 22nd February 2019 and 25th March 2019 which have been treated as payments under the DTVSV Act pursuant to declaration made, which according to him, are not refundable in view of Section 7 of DTVSV Act. Mr. Pardiwalla, learned Senior Counsel submits that Petitioner has, in view of the issuance of Form 3 by the Designated Authority, sought to withdraw the appeal pending before CIT(A). He submits that none of the sections nor the Circulars empower the Designated Authority to review and/or revoke Form 3 issued by it or to reject the application after issuance of Form 3 except in the cases mentioned in Section 4(6) of the DTVSV Act, which section, he submits is not attracted. 11. He also submits that Section 9 of the DTVSV Act is not applicable to the case of Petitioner. It is submitted th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t, 2020 as purportedly clarified by CBDT circular No. 21 of 2020 dated 4th December 2020 and further by circular No. 4 of 2021 dated 23rd March 2021. 15. Mr. Suresh Kumar, learned Counsel for Revenue, while vehemently reiterating the aforesaid aspects and submissions, draws our attention to the assessment order dated 24th December 2018 (at page 76 of the Petition) in the case of Petitioner to submit that in fact a search and seizure action under Section 132 was carried out in the case of Petitioner as well as its partners, viz., Pratibha Shah and Shirin Shah on 22nd March, 2018. He submits that Petitioner s case is, therefore, a Search Case. 16. Mr. Suresh Kumar also takes us to the provisions of Section 4(6) (a) of the DTVSV Act to submit that despite Petitioner s case being a Search Case, as seen from the Assessment Order, Petitioner has declared its case to be a non-search case and, therefore, Petitioner s declaration is false in material particulars making it non-est under the said Section. 17. On 7th July 2021, learned Counsel for Revenue has also filed an additional affidavit dated 6th July 2021 bringing on record the communication dated 25th February 2021 referred t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... er under the DTVSV Scheme entailing adverse consequences. And all this done without affording Petitioner sufficient opportunity of hearing or making submissions. In our view, considering that Form 3 had already been issued, on the declarations and undertaking filed by Petitioner, any action on the same entailing adverse consequences, ought to have been afforded with a fair and reasonable opportunity to explain its case, which the Revenue has ex-facie failed to offer. We are unable to comprehend the tearing hurry with which the Revenue has acted without even waiting for the three days period to elapse. In our view, such an action is liable to be set aside because it strikes to the root of the matter. We are also left with no option, but to remand the matter back to the Designated Authority to take decision in the matter after giving a fair and reasonable opportunity of hearing to Petitioner and after considering the submissions by following the principles of natural justice. 22. In the circumstances, we set aside the order of rejection dated 26th March 2021 and direct the Respondent No.1 Designated Authority, after giving a proper opportunity of hearing to Petitioner and after co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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