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TMI Blog2022 (2) TMI 943X X X X Extracts X X X X X X X X Extracts X X X X ..... in the circular is superfluous. In this context the question arises whether the specification of the filing of the application for condonation before the date of circular is sacrosanct as to destroy the right of assessee to apply for settlement if even though all other conditions are specified. This question has been examined by several High Courts. See case of the Telangana High Court in case of Boddu Ramesh v. Designated Authority [ 2021 (6) TMI 1054 - TELANGANA HIGH COURT] and MAHESHBHAI SHANTILAL PATEL [ 2021 (9) TMI 1237 - GUJARAT HIGH COURT] Independently also we are of the view that the stand taken by the department is not sustainable. To begin with the act was framed for resolution of the disputed taxes and the matters connected therewith and thereto. The resolution of disputed taxes is thus prime purpose of enactment of the act. We would therefore adopt an interpretation which would further this intention instead of restricting its scope. More importantly what the CBDT had done under its circular dated 04.12.2020 was to issue a clarification. A clarification by its very nature is declaratory. If for applicability of such clarification a cut off date is introduced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... smissed by the CIT (appeals) on 07.05.2019. Against this order the assessee had filed the appeal before Income Tax Appellate Tribunal on 09.12.2020. Along with the appeal the assessee had also filed an application for condonation of delay. The delay was condoned by the tribunal by an order dated 28.01.2021. In the meantime the legislature framed the direct tax Vivad se Vishwas Scheme, 2020. It was brought into effect from 17.03.2020. This act contains provisions for settlement of pending direct tax disputes. The term appellant has been defined under Section 2(1)(a) which reads as under:- (a) appellant means- (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; (ii) a person in whose case an order has been passed by the Assessing Officer, or an order has been passed by the Commissioner (Appeals) or the Income Tax Appellate 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 appeal or special leave petition a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arrear shall be deemed to have been withdrawn from the date on which certificate under Section 3 and 4 has been issued by the designated authority. Section 5 of the Act pertains to time and manner of payment. Sub-section (1) of Section 5 provides that the designated authority shall within a period of 15 days from the date of receipt of the declaration by an order determine amount payable by the declarant. As per sub-section (2) of Section 5 the declarant has to pay the amount as determined under sub-section (1) within 15 days of the date of receipt of the certificate and intimate the details of such payments to the designated authority. Sub-section (1) of Section 10 provides that Central Board of Direct Taxes made from time to time issue such directions or orders to the income tax authorities as it may deem fit. Subsection (2) of Section 10 empowers the CBDT to issue general order or special order in respect of any class of cases setting forth the directions or instructions as to the guidelines, principles or procedures to be followed in relation to the act. The petitioner was desirous of taking benefit of the said settlement scheme contained in the Act of 2020 and therefore ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax, penalty, fee etc. as prescribed under the Act. The term appellant as noted earlier means 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, a person in whose case an order has been passed by the assessing officer or the CIT (Appeals) or Tribunal or by the High Court in a writ petition before a specified date and time for filing any appeal has not lapsed or a person who has filed objection before the dispute resolution panel under Section 144C of the Act of 1961 and the assessing officer has not issued any direction or a person in whose case the panel has issued a direction but the assessing officer has not passed an order or a person who has filed an application for revision under Section 264 of the Act of 1961 and such application is pending. It was in this context that the CBDT had issued a clarification in the context of question No.59 whether taxpayer in whose case the time limit for filing of appeal has expired before 31st January 2020 but an application for condonation has been filed is eligible to make a declaration or not? The clarification issued by the CBDT was that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the relevant point in time. 33. It is only on 31.12.2020, the time for filing declarations under the Act of 2020 was extended for further period. 34. In the answer provided to Q.No. 59 in circular No 21/2020, it is stated that even if the limitation for filing appeal has expired before 31.01.2020, i.e., the 'specified date', if an application for condonation of delay is filed on or before the date of issue of Circular, and the delay is condoned, the appeal should be deemed to be pending as on 31.01.2020 . 35. This would have to be considered, in our opinion, as applicable even in relation to further extension of time granted for filing declarations till 31.03.2021, and cannot be restricted either up to the date of issue of circular (ie. 04.12.2020) or even the date for filing declaration mentioned therein ((ie.) 31.12.2020, as there cannot be any differentiation in delay as it stands on the same footing be it of a day or more. 36. If Board circular is construed in such a restrictive manner, as is contended by respondents, the same would run contrary to the scheme of the Act of 2020 and the powers exercised by Board under Section 10 and 11 to issue directions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nded up to 31.03.2021 and the Tribunal, having found cogent reasons to condone the delay and allowing the appeal filed by the petitioner and remitting the matter back to the CIT by its order dt.15.02.2021, would automatically revive and restore the appeal, which was dismissed by the CIT by his order dt.18.09.2019. Thus, by order of the Tribunal dt.15.02.2021, the appeal of the petitioner before of the CIT filed on 19.02.2019 would stand revived, and such restoring of appeal relates back the original date of filing, which is within the specified date as per Act of 2020. 42. Thus, considered from any angle, the declaration/application submitted by the petitioner on 08.02.2021 or the revised declaration/application submitted in Form 1 and 2 on 31.03.2021 cannot be considered as 'invalid' and liable for 'rejection'. This judgment of the Telangana High Court in case of Boddu Ramesh (supra) was followed by the Division Bench of Gujarat High Court in case of Maheshbhai Shantilal Patel V. PCIT dated 23.09.2021 reported in 2021 (9) TMI 1237. The following observations may be noted:- 35 Therefore, when the Circular has been issued by the CBDT on 04.12.2020 an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of condonation of delay by ITAT on dated 23.02.2020 would not in any manner hamper his path of his case being considered under the VsV Act as an Appellant. 38 Resultantly, the petition is allowed, quashing and setting aside the order of rejection by the respondent authority on dated 30.03.2021. Consequently, the petitioner is entitled to the participation in the process under the VsV Scheme. 39 Let the declaration of the petitioner be accepted by the respondent within three (3) days from the receipt of the copy of this order and the petitioner shall follow the requirement of payment of tax as the last date is 30.09.2021. All consequential procedural actions shall be permitted by the respondent in accordance with law, to enable the petitioner to be considered under the VsV Act. Quite apart from these two well considered judgments of the Division Bench of two High Courts, independently also we are of the view that the stand taken by the department is not sustainable. To begin with the act was framed for resolution of the disputed taxes and the matters connected therewith and thereto. The resolution of disputed taxes is thus prime purpose of enactment of the act. We would th ..... X X X X Extracts X X X X X X X X Extracts X X X X
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