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TMI Blog2024 (3) TMI 1013X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 2020* setting out the refundable amount due to the petitioner as follows:- Rs. 3,25,75,388/- Rs. 4,17,77,082/- Rs. 18,49,55,219/- Rs. 6,14,06,367/- in terms of the Rectification order dated 29.01.2021 issued by the 1st respondent. *DTVSV Act, 2020 for short. 2. I have considered the arguments advanced by the learned counsel for the petitioner as well as the learned counsel for the respondent and perused the materials available on record. 3. The petitioner opted to settle the disputes under Direct Tax Vivad Se Vishwas Act, 2020(No.3 of 2020) [hereinafter referred to as DTVSV Act, 2020] by filing declarations in Form-1 on 31.01.2021 for ten Assessment Years starting from Assessment Year 1999 - 2000 upto Assessment Year 2008 - 2009 before the Designated Authority in terms of Section 4(1) of the DTVSV Act, 2020 r/w Rule 3 of the Direct Tax Vivad Se Vishwas Rules 2020 (hereinafter referred to as the DTVSV Rules, 2020). 4. The Parliament had enacted The DTVSV Act, 2020 to give a reprieve to those income tax assesse's who had "tax arrears" of "disputed tax" as defined in the said Act. DTVSV Act, 2020 received the assent of the President on the 17th March, 2020. 5. The Desig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 01, the tax payable by the petitioner were adjusted out of refunds due to the petitioner for the Assessment Year 2004-2005 & Assessment Year 2005-2006. For the following Assessment Years, penalty were also imposed on the petitioner which were said to have been appealed before CIT(A) in the following Appeals :- Assessment Year Appeal Number Disputed Penalty (Rs.) 1999-2000 I.T.A.No.1949/ CHNY-2006 3,35,82,870/- 2000-2001 I.T.A.No.1950/ CHNY-2006 7,83,93,502/- 2001-2002 I.T.A.No.48/2005-06 2,05,29,631/- 12. For the rest of the Assessment Years, appeals were said to be pending before the Income Tax Appellate Tribunal ("ITAT"). They would have been withdrawn as the petitioner availed the benefit of DTVSV Act, 2020. 13. While these appeals were still pending before the Hon'ble Supreme Court for the Assessment Year 1999-2000 and Assessment Year 2000-2001, the Assistant Director of Income Tax, International Taxation-I passed three separate orders all dated 25.07.2012 under Section 254 of the IT Act, 1961 for the Assessment Years 2000-2001 to 2002-2003 to give effect to order of the Tribunal dated 11.05.2007 in ITA.No.411/Mds/2006 for the Assessment Years 2000-2001. Sim ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ction 244 A of the IT Act, 1961 are reproduced below:- Section 245 of the IT Act, 1961 Section 244-A of the IT Act, 1961 Set off of refunds against tax remaining payable Interest on Refunds:- Where under any of the provisions of this Act, a refund is found to be due to any person, the Assessing Officer, Deputy Commissioner (Appeals), Commissioner (Appeals) or Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner, as the case may be, may, in lieu of payment of the refund, set off the amount to be refunded or any part of that amount, against the sum, if any, remaining payable under this Act by the person to whom the refund is due, after giving an intimation in writing to such person of the action proposed to be taken under this Section". (1)Where refund of any amount becomes due to the assessee under this Act he shall, subject to the provisions of this sections, be entitled to receive, in addition to the said amount, simple interest thereon calculated in the following manner, namely:- (a) Where the refund is out of any tax collected at source under section 206C or paid by way of advance tax or treated as paid under section 199, during ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at the rate of three per cent per annum, for the period beginning from the date following the date of expiry of the time allowed under subsection (5) of section 153 to the date on which the refund is granted:] [Provided that where proceedings for assessment or reassessment are pending in respect of an assessee, in computing the period for determining the additional interest payable to such assessee under this sub-section, the period beginning from the date on which such refund is withheld by the Assessing Officer in accordance with and subject to provisions of subsection (2) of section 245 and ending with the date on which such assessment or reassessment is made, shall be excluded] (1B) Where refund of any amount becomes due to the deductor in respect of any amount paid to the credit of the Central Government under Chapter XVII-B, such deductor shall be entitled to receive, in addition to the said amount, simple interest thereon calculated at the rate of onehalf per cent for every month or part of a month comprised in the period, from the date on which- (a)claim for refund is made in the prescribed form; or (b)tax is paid, where refund arises on account of giving effect to a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arrear which exceeds the amount payable under Section 3, he shall be entitled to a refund of such excess amount, but shall not be entitled to interest on such excess amount under Section 244A of the Income-tax Act." 21. Tax payable and refundable as per the petitioner in Form-1 and the Department in Form-3 under the DTVSV Act, 2020 are as under:- Assessment Year As per the petitioner As per Income Tax Authority Tax arrears (Rs.) Amount Refundable (Rs.) Tax arrear (Rs.) Amount payable under DTVSV on or before 30.04.2021 Amount payable under DTVSV after 30.04.2021 Amount Refundable (Rs.) 1999-2000 3,35,82,870 3,25,75,389 1,91,27,094 1,77,97,806 1,95,77,587 1,88,83,989 2000-2001 7,83,93,502 6,14,06,367 5,13,56,716 5,13,56,716 5,64,92,387 4,41,25,531 2001-2002 2,05,29,631 4,69,09,490 15,50,90,573 15,50,90,573 17,05,99,630 2,77,86,748 2002-2003 0 18,49,55,218 5,61,12,304 5,61,12,304 6,17,23,534 8,15,79,272 22. The amounts quantified as "tax arrears" and "payable" by the petitioner in Form-1 are the penalty for the above mentioned Assessment Years. The tax liability determined by the Designated Authority is correct in Form-3 which wa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion 244-A of IT Act, 1961 quantified in order dated 29.01.2021 by the Deputy Commissioner of Income Tax, International Taxation under Section 154 of the IT Act, 1961 which was not recognized in Form-3 issued for the Assessment Years Assessment Years 1999-2000 to 2002-2003 for being adjusted towards the tax liability of the petitioner for the Assessment Years 2003-2004 to 2006- 2007 under DTVSV Act, 2020. 27. The learned Senior Counsel for the petitioner has drawn attention to decisions of this Court in the following cases:- i. W.P.No.16022, etc., batch of 2021, dated 13.04.2022; ii. W.P.No.15762 of 2021, dated 29.11.2021. 28. The learned Senior Counsel for the petitioner has further drawn attention to the decision of the Bombay High Court in the following cases:- i. Mantelone Investment Limited vs. The Commissioner of Income Tax (IT), Mumbai- 03 rendered in W.P.No.1246 of 2021, by its order dated 15.06.2021; ii. UPS Freight Services India Private Limited vs. Deputy Commissioner of Income Tax rendered in [2023] 156 taxmann.com 489(Bombay) 29. This Court in its order made in W.P.Nos.15762 & 15763 of 2021, dated 29.11.2021 held as under:- "24. There is no dispute that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed in Column 3 to 4 to the Table to Section 3 of the DTVSV Act, 2020. Section 3(1) of the DTVSV Act, 2020, reads as under:- 3. Amount Payable by declarant - Subject to the provisions of this Act, where a declarant files under the provisions of this Act on or before the last date, a declaration to the designated authority in accordance with the provisions of section 4 in respect of tax arrear, then, notwithstanding anything 43 of 1961. Amount payable by declarant contained in the Income-tax Act or any other law for the time being in force, the amount payable by the declarant under this Act shall be as under, namely:- 1 2 3 4 Sl.No. Nature of tax arrear Amount payable under this Act on or before the 31st day of March, 2020 Amount payable under this Act on or after the 1st day of April 2020 but on or before the last date. (a) Where the "tax arrear" is the aggregate amount of disputed tax. interest chargeable or charged on such disputed tax and penalty leviable or levied on such disputed tax. Amount of the dispute tax The aggregate of the amount of disputed tax and ten per cent of disputed tax: provided that where the ten per cent of disputed tax exceeds the aggregate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r writ petition or special leave petition was to be decided against him; B) in a case where an order in an appeal or in writ petition has been passed by the appellate forum on or before the specified date, and the time for filing appeal or special leave petition against such order has not expired as on that date, the amount of tax payable by the appellant after giving effect to the order so passed; C) in a case where the order has been passed by the Assessing Officer on or before the specified date, and the time for filing appeal against such order has not expired as on that date, the amount of tax payable by the appellant in accordance with such order; D) in a case where objection filed by the appellant is pending before the Dispute Resolution Panel under section 144C of the Income-tax Act as on the specified date, the amount of tax payable by the appellant if the Dispute Resolution Panel was to confirm the variation proposed in the draft order; E) in a case where Dispute Resolution Panel has issued any direction under sub-section (5) of section 144C of the Income-tax Act and the Assessing Officer has not passed the order under sub-section (13) of that section on or before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 1,27,094/- 2 10393/2021 2000-2001 Rs. 5,13,56,716/- 3 10600/2021 2001-2002 Rs. 15,50,90,573/- 4 10395/2021 2002-2003 Rs. 5,61,12,304/- Total Rs. 28,16,86687/- 35. Under Section 7 of the DTVSV Act, 2020, any amount paid in excess in pursuance of the declaration is not refundable. However, where the declarant had, before filing the declaration under Sub-Section (1) of Section 4, paid any amount under their Act, 1961 in respect of his tax arrears which exceeds the amount payable under Section 3, shall be entitled to a refund of such excess amount. 36. However, such a declarant is not be entitled to interest on such excess amount under Section 244-A of the IT Act, 1961. Section 7 of DTVSV Act, 2020 is a complete code by itself. If the case is to be settled under it, no interest under Section 244-A of the IT Act, 1961 is available. 37. In this case, no amount was paid by the petitioner either along with Form-1 on 31.1.2021 or after Form-3 that was issued on various dates. The petitioner wants the Designated Authority to issue a fresh Form-3 together with interest on refunds under Section 244-A of the IT Act, 1961 on belated adjustment of refunds. This is not a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the DTVSV Act, 2020. It makes it clear, that a declarant shall not be entitled to interest under Section 244-A of IT Act, 1961 on such excess amounts. 43. Therefore, the petitioner is not entitled to the relief as prayed for in full. The amounts that have been ordered to be refunded under Section 154 Order dated 29.01.2021 for the Assessment Year 1999-2000 and Assessment Year 2000-2001, are refundable separately together with interest under Section 244-A of the IT Act, 1961 for the Assessment Year 2004-2005 and Assessment Year 2005-2006 subject to limitation under Explanation to Section 7 of the DTVSV Act, 2020, i.e., no declaration was filed for Assessment Year 2004-2005 and Assessment Year 2005-2006. 44. The amount of tax that has been ordered to be refunded for the rest of the two Assessment Years ie., Assessment Year 2001-2002 and Assessment Year 2002-2003 are concerned, excess amounts are refundable in view of Section 7 of the DTVSV Act, 2020. However, the petitioner is not entitled to interest under Section 244-A of the IT Act, 1961 for these two Assessment Years in view of Explanation to Section 7 of the DTVSV Act, 2020. 45. Therefore, to do complete justice and to balan ..... 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