ITO WARD-25(3), NEW DELHI vs. TINNA FINEX LTD., NEW DELHI

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ITA 109/DEL/2020Status: DisposedITAT Delhi14 July 2022AY 2012-133 pages

In favour of the assessee: the Revenue's appeal was dismissed. From the AI summary of this appeal.

AI SummaryDismissed

What did the Tribunal hold?

The Tribunal held that in cases where both quantum and penalty appeals are pending, and the quantum appeal is settled under VSVS, the penalty appeal is also to be disposed of accordingly. The settlement of the quantum appeal under VSVS necessitates the dismissal of the related penalty appeal.

What were the facts?

The Revenue filed an appeal against a penalty order. The assessee had settled the corresponding quantum appeal under the Direct Tax Vivad Se Vishwas Act, 2020 (VSVS). The assessee argued that the penalty appeal should also be dismissed due to the settlement of the quantum appeal.

What were the issues?

Whether a penalty appeal is to be dismissed if the corresponding quantum appeal has been settled under the Direct Tax Vivad Se Vishwas Act, 2020.

Which sections of the Income-tax Act were involved?

Section 250

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, DELHI

Before: DR. B.R.R. KUMAR & SH. ANUBHAV SHARMA

For Appellant: Ms. Supriya Mehta, CA
For Respondent: Shri M. Baranwal, Sr. DR, Ms. Supriya Mehta, CA
Hearing: 12.07.2022Pronounced: 14.07.2022

This appeal has been preferred by the Revenue against the appellate order dated 21.10.2019 u/s 250 of the Income Tax Act, 1961 (hereinafter referred to as “The Act”) passed by Commissioner of Income Tax (Appeals)- 36, New Delhi being appeal no.CIT(A), Delhi- 36/10111/19-20, Ap. No. 46/2019-20, New Delhi .

2.

Heard. At the time of hearing, the learned representative for the assessee filed and referred to Form 5 issued by the Competent Authority in terms of Section 5(2) r/w Section 6 of The Direct Tax Vivad Se Vishwas Act, 2020 qua the settling of dispute on quantum in therefore, it is submitted that the present penalty appeal filed by the Revenue, is also liable to be dismissed in view of the settlement of the corresponding quantum appeal under The Direct Tax Vivad Se Vishwas Act, 2020 or in short VSVS.

The aforesaid factual matrix is not disputed by the learned DR.

3.

In this connection, the Bench can refer specifically to Question No. 8 and 34 of the clarifications issued by the CBDT on provisions of The Direct Tax Vivad Se Vishwas Act, 2020 vide Circular No. 9/2020 dated which is reproduced as below; “Que 8. Imagine a case where an appellant desires to settle concealment penalty appeal pending before CIT (A), while continuing to litigate quantum appeal that has travelled to higher appellate forum. Considering these are two independent and different appeals, whether appellant can settle olle to exclusion of others? If yes, whether settlement of penalty appeal will have any impact on quantum appeal?

Ans 8. If both quantum appeal covering disputed tax and appeal against penalty levied on such disputed tax for an assessment year are pending, the declarant is required to file a declaration form covering both disputed tax appeal and penalty appeal. However, he would be required to pay relevant percentage of disputed tax only. Further, it would not be possible for the appellant to apply for settlement of penalty appeal only when the appeal on disputed tax related to such penalty is still pending”

“Que 34 Appeals against assessment order and against penalty order are filed separately on same issue. Hence there are separate appeals for both. In such a case how disputed tax is to be calculated?

Ans. Please see question no. 8. Further, it is clarified that if the appellant has both appeal against assessment order and appeal against penalty relating to same assessment pending for the same assessment year, and he wishes to settle the appeal against assessment order (with penalty appeal automatically covered), he is required to indicate both appeals in one declaration form (Form No I) for that year.”

4.

In the light of aforesaid admitted state of settlement of quantum appeal under VSVS and assuming fulfillment of aforesaid conditions laid down in clarification referred above, the appeal in hand is statistically disposed of as dismissed.

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