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TMI Blog2021 (12) TMI 1138X X X X Extracts X X X X X X X X Extracts X X X X ..... ith the opinion expressed by the Division Bench that the Gujarat High Court, while dealing with such type of contingency or a situation as it cannot enlarge, the scope by widening its determination of consideration of an appellate jurisdiction by barging into its jurisdiction, to determine the question; as to whether at all the appeal itself was pending consideration at the time when, it was instituted when the Act was enforced w.e.f. 17th March, 2020. So far the argument of the learned counsel for the respondents in the light of the provisions contained under Section 2 (1) (a) (i) is concerned, the said provision would not be attracted in the present case, for the reason being that the said exception, which has been carved out was only on those cases, where the Assessing Officer or an order, which has been passed by the Commissioner Appeals or the Income Tax Appellate Tribunal; in an appeal and the appeal or revision was not pending at the relevant time, but since, in the instant case, no such situation has arrived at because the appeal itself was pending consideration since 2017, along with the delay condonation application, the provisions of (ii) of Section 2 (1) (a) of the Act, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder 271 (1) (c) of the Income Tax Act and has raised an additional demand of tax of ₹ 4,51,000/-. 4. Consequently, after the aforesaid determination, the total demand of tax liability, which was sought to be levied upon the petitioner was attempted to be recovered in the month of 2019, hence, the petitioner submits, that as against the said assessment of tax made by the respondents, she had preferred an Appeal under Section 249 (2) of the Income Tax Act, i.e. as against the assessment order of 22nd March, 2016, which was numbered as Appeal No. 10268/CIT (A)/DDN/2017-18, by filing it before respondent No.2 on 13th December, 2017, this would be the date of filing of the Appeal under Section 249 (2) of the Income Tax Act. 5. The petitioner has contended that in accordance with the provisions contained under Sections 3 and 4 of the Act of 2020, the forum which has been provided therein for the purposes of redressal of the dispute for the remittance of the tax matter, connected with or incidental thereto, would still be left open to be considered by the respondents in the light of the provisions contained under Section 3 and 4 of the Act of 2020. But, however, the respondents/A ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... provisions contained under Sections 3 and 4, of the Direct Tax Vivad Se Vishwas Act, 2020. 10. Factually, the petitioner has come up with the case, in the Writ Petition, that so far as the petitioner is concerned, the income which accrued to him for the assessment years 2010-11, for the year ending on 31st March, 2010, was self-assessed by the petitioner, as to be ₹ 2,22,014/-, whereas the respondent No.3, after re-assessing the tax liability payable by the petitioner under Section 143 (2), to be read with Section 147 of the Income Tax, has assessed the income tax to the tune of ₹ 17,72,010/-, thereafter imposing the penalty on the demand on the petitioner to the tune of ₹ 4,40,000/-, while exercising its powers under Section 271 (1) (c) of the Income Tax Act by an order of 21st September, 2016. 11. The petitioner has submitted that being aggrieved against the assessment order thus made by the assessing authority, for the assessment years 2010-11 on 22nd March, 2016, he has preferred an Appeal, under Section 249 (2) of the Income Tax Act, being Appeal No. 10266/CIT(A)/DDN/2017-18, by preferring the same before the respondent No.2 on 31st December, 2017. 12. On ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of disputed tax: provided that where the thirty-five per cent. of disputed tax exceeds the aggregate amount of interest chargeable or charged on such disputed tax and penalty leviable or levied on such disputed tax, the excess shall be ignored for the purpose of computation of amount payable. (c) where the tax arrear relates to disputed interest or disputed penalty or disputed fee. twenty-five per cent. of disputed interest or disputed penalty or disputed fee. thirty per cent. of disputed interest or disputed penalty or disputed fee: Provided that in a case where an appeal or writ petition or special leave petition is filed by the income-tax authority on any issue before the appellate forum, the amount payable shall be one-half of the amount in the Table above calculated on such issue, in such manner as may be prescribed: Provided further that in a case where an appeal is filed before the Commissioner (Appeals) or objections is filed before the Dispute Resolution Panel by the appellant on any issue on which he has already got a decision in his favour from the Income Tax Appellate Tribunal (where the decision on such issue is not reversed by the High Court or the Supreme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , whether direct or indirect, to seek or pursue any remedy or any claim in relation to the tax arrear which may otherwise be available to him under any law for the time being in force, in equity, under statute or under any agreement entered into by India with any country or territory outside India whether for protection of investment or otherwise and the undertaking shall be made in such form and manner as may be prescribed. (6) The declaration under sub-section (1) shall be presumed never to have been made if,- (a) any material particular furnished in the declaration is found to be false at any stage; (b) the declarant violates any of the conditions referred to in this Act; (c) the declarant acts in any manner which is not in accordance with the undertaking given by him under sub-section (5), and in such cases, all the proceedings and claims which were withdrawn under section 4 and all the consequences under the Income-tax Act against the declarant shall be deemed to have been revived. (7) No appellate forum or arbitrator, conciliator or mediator shall proceed to decide any issue relating to the tax arrear mentioned in the declaration in respect of which an order has bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... late Tribunal in an appeal, or by the High Court in a writ petition, on or before the specified date, and the time for filing any 9 appeal or special leave petition against such order by that person has not expired as on that date; The benefit under the Act of 2020, would not be available to the petitioners, as they were not the appellants as per the Act of 2020. 19. In response to this precise argument of the learned counsel for the respondent, the learned counsel for the petitioner has submitted, that the parameters provided under (ii) of Sub-section (1) of Section 2, the "appellant" as described under the Act, would not be applicable in the circumstances of the instant case, for the reason being that, his submission is based upon the interpretation given to the definition of "appellant" provided under (i) of Sub-section (1) of Section 2 of the Act, which reads as under :- "(i) a person in whose case an appeal or a writ petition or special leave petition has been filed either by him or by the income-tax authority or by both, before an appellate forum and such appeal or petition is pending as on the specified date;" 20. The learned counsel for the respondents had carved out a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing within its ambit the appeals, which has been preferred, along with the delay condonation application, because the Legislature itself has not carved out an exception or distinction, about the pendency of an appeal and its nature, hence, it had concluded that even if an appeal has been preferred along with the delay condonation application, it would be treated to be as good as an appeal to attract the benefits, which were contemplated under Section 24 of the said Act, and it would amount to be the pendency of a valid and competent appeal under the Act. Para 6 is quoted hereunder :- "6. It is contended that section 24 contemplates the pendency of a valid and competent appeal, but as no valid or competent appeal under the law was pending, the appellants committed no offence under section 27. We are unable to accept this contention. Section 24 on a plain and natural construction requires for its application no more than that an appeal should be pending and there is nothing in the language to justify the introduction of the qualification that it should be valid or competent. Whether the appeal is valid or competent is a question entirely for the appellate court before whom the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al which they thought was incompetent. In this view of the matter it is not necessary to consider whether the conferment of a right of 12 appeal during the pendency of a proceeding can affect the rights of the parties to those proceedings and make the order in the pending proceeding appealable." 24. In fact, this principle, which has been laid down in para 6 of the judgment of Raja Kulkarni (Supra), was based upon yet another prior judgment which was rendered by the Hon'ble Apex Court in the matter of Nagendra Nath Dey Vs. Suresh Chandra Dey, wherein, the Hon'ble Apex Court has laid down that by insertion or by qualifying the words as are intended to be introduced by the respective contentions raised contrary to the intention of the legislature by not construing the word, i.e. the 'Appeal' in its appropriate manner than as, what it has been suggested by the appellate provision, it will run contrary to the intention of the appellate provisions itself, even if the appeal is pending along with the delay condonation application, it would still be an appeal. 25. This ratio laid down by the Hon'ble Apex Court was later on considered in yet another judgement of the Hon'ble Apex Court, a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Apex Court, in the judgment of Commissioner Income Tax (Supra), where the reference has been made to the judgment of (2003) 2 SCC 19, Dr. Renuka Datla and others Vs. Commissioner Income Tax and another. In fact, in the said judgement too, which was dealing almost an identical issue, as to what would be status of an appeal and its effect of its pending, in the light of the provisions contained under the appellate provisions of Section 95, which was a subject matter of consideration in the said case, where specifically in Sub-section (c) of Section 95, it provided, that in a case, where no other appeal or reference or writ petition is admitted and pending; before the appellate Court or the High Court, 14 was a subject matter of consideration, where it had dealt the issue in the matter extracted hereunder. 28. The said judgment of the Hon'ble Apex Court, in fact, in para 19, has laid down that the pendency of the appeal, itself would be construed in the manner, if it has been preferred under the provisions of the Act, which contemplates and provides for an appellate provisions of filing of an appeal, when the appellate provision itself has not classified the status of appeal or the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at there was no appeal pending in respect of the tax arrears pertaining to those items within the meaning of Section 95(1)(c)." 29. The judgment of the Division Bench of Gujarat High Court, particularly, as that rendered in Ritesh Bakuleshbhai Mehta Vs. The Principal Commissioner of Income Tax, was dealing with an almost an identical issue, which is a subject matter of consideration in the present Writ Petition. In that case, too the Division Bench was ceased with the issue interpreting, as to what inference, would the "specified date" as it has been provided under Sub-clause (n) of Section 2, is to be taken into consideration in the light of the provisions contained under Section 2 (1) (a) of the Act, and accordingly, while laying down its principle, the learned Division Bench of the Gujarat High Court, has relied on the judgment of the Hon'ble Apex Court rendered in the Commissioner Income Tax (Supra) and in para 10, while extracting the observations which were made in the said judgment from para 13, 15 and 16, has laid down that the legal position thereof remains so that no shadow or doubt to a pendency of an appeal can be said to be carved out by the Courts, when it is pending ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appeal/revision was "sham", "ineffective" or "infructuous" as it has. 16. In the case of Raja Kulkarni v. The State of Bombay reported in AIR 1954 SC 73, this Court laid down that when a section contemplates pendency of an appeal, what is required for its application is that an appeal should be pending and in such a case there is no need to introduce the qualification that it should be valid or competent. Whether an appeal is valid or competent is a question entirely for the appellate court before whom the appeal is filed to decide and this determination is possible only after the appeal is heard but there is nothing to prevent a party from filing an appeal which may ultimately be found to be incompetent, e.g., when it is held to be barred by limitation. From the mere fact that such an appeal is held to be unmaintainable on any ground whatsoever, it does not follow that there was no appeal pending before the Court. 17. To the same effect is the law laid down by the judgment of this Court in the case of Tirupati Balaji Developers (P) Ltd. v. State of Bihar & Others reported in (2004) 5 SCC 1, in which it has been held that an appeal does not cease ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. Tushar Hemani appearing with learned Advocate Ms. Vaibhavi K. Parikh for the Petitioner, taking the Court to the Scheme of the said Act, more particularly, the definition of an "Appellant" contained in Section 2(i)(a), submitted that since the Appeal of the Petitioner was pending before the Appellate Authority on the 'specified date', i.e. 31.1.2020, the Petitioner was an 'Appellant' as defined under the said Act, and was eligible to file the Declaration. According to him, the same has been wrongly rejected on the extraneous ground that there was no reply received from CIT (Appeals), as to whether, any order of condonation of delay was passed in the said Appeal or not. Learned Senior Advocate Mr. Hemani has placed reliance on the decision of the Supreme Court in case of Commissioner of Income Tax v. Shatrusailya Digvijaysingh Jadeja - [2005] 147 Taxman 566 (SC) as also on the unreported decision of the Delhi High Court in case of Shyam Sunder Sethi v. Pr. Commissioner of Income Tax -10 & Ors. passed in W.P. (C) 2291/2021 and CM Appl. 6677/2021, to submit that the Declaration of the Appellant could not have been rejected by the Respondent Authority when the Appeal was pending, ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... clude and shall be deemed never to have been included a person in whose case a writ petition or special leave petition or any other proceeding has been filed either by him or by the income-tax authority or by both before an appellate forum, arising out of an order of the Settlement Commission under Chapter XIX-A of the Income-tax Act, and such petition or appeal is either pending or is disposed of.] 32. In this judgment of the Division Bench, too is rather foundationed on the judgment of the Commissioner Income Tax Vs. Shatrusailay Digvijaysingh Jadeja (Supra), where yet again the reliance has been placed to para 13, 15 and 17 of the said judgment and the principle proposition as it has been laid down in para 11 of the said judgment, which is extracted hereunder :- "11. In view of the aforestated legal position, there remains no shadow of doubt that appeal could be said to be pending, even if the delay occurred in filing the same was not condoned and even if it was allegedly irregular or incompetent. In the instant case therefore also, the Respondent could not have rejected the Declaration Form of the Petitioner filed under the said Act merely on the ground that the Appeal was n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng with such type of contingency or a situation as it cannot enlarge, the scope by widening its determination of consideration of an appellate jurisdiction by barging into its jurisdiction, to determine the question; as to whether at all the appeal itself was pending consideration at the time when, it was instituted when the Act was enforced w.e.f. 17th March, 2020. 35. So far the argument of the learned counsel for the respondents in the light of the provisions contained under Section 2 (1) (a) (i) is concerned, I am of the view that for the reasons already given, the said provision would not be attracted in the present case, for the reason being that the said exception, which has been carved out was only on those cases, where the Assessing Officer or an order, which has been passed by the Commissioner Appeals or the Income Tax Appellate Tribunal; in an appeal and the appeal or revision was not pending at the relevant time, but since, in the instant case, no such situation has arrived at because the appeal itself was pending consideration since 2017, along with the delay condonation application, the provisions of (ii) of Section 2 (1) (a) of the Act, would not be applicable. 36. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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