Loading judgment…
Facts
The assessee's appeal was dismissed by the CIT(A) as infructuous, citing the assessee's opting for the Vivad Se Vishwas Scheme. The assessee contends that the appeal before the CIT(A) pertains to an order under Section 154, while the Vivad Se Vishwas settlement was for an order under Section 143(3). The Revenue did not dispute this proposition.
Held
The Tribunal found merit in the assessee's plea that the VSVS settlement was not for the order under Section 154. It was held that the interest of justice requires the issue to be remitted back to the CIT(A) to ascertain the correct position regarding the VSVS application.
Key Issues
Whether the CIT(A) erred in treating the appeal as infructuous when the VSVS settlement was not applicable to the order under Section 154.
Sections Cited
154, 143(3), Direct Tax Vivad se Vishwas Act, 2020
AI-generated summary — verify with the full judgment below
Income Tax Appellate Tribunal, DELHI BENCH, ‘H’: NEW DELHI
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH, ‘H’: NEW DELHI BEFORE SHRI SHAMIM YAHYA, ACCOUNTANT MEMBER AND SHRI ANUBHAV SHARMA, JUDICIAL MEMBER (Assessment Year: 2015-16) Adroitec Information System P. Ltd., vs. ITO, Ward 1 (1), A – 43A, Shop No.3, New Delhi. Panchsheel Vihar, Malviya Nagar, New Delhi – 110 017. (PAN : AAACH2422A) (APPELLANT) (RESPONDENT) ASSESSEE BY : Shri Nitin Goyal, CA REVENUE BY : Shri Amit Katoch, Sr. DR Date of Hearing : 08.01.2024 Date of Order : 10.01.2024
ORDER PER SHAMIM YAHYA, ACCOUNTANT MEMBER : This appeal by the assessee is directed against the order of the ld. CIT (Appeals)/National Faceless Appeal Centre (NFAC) dated 10.08.2022 for the assessment year 2015-16.
The grounds of appeal taken by the assessee read as under :-
“1. That on the facts and circumstances of the case and in law, the Ld. CIT has erred in concluding that appeal is infructuous and dismissed the appeal without even giving an opportunity to make submission, which is bad in law and against the principal of natural justice.
2. That on the facts and circumstances of the case and in law, the Ld. CIT has erred in treating the appeal infructuous by invoking provisions of Direct Tax Vivad se Vishwas Act 2020 (DTVsVs). 2.1 That on the facts and circumstances of the case and in law, the Ld. CIT has erred in not appreciating the fact that the Appellant has filed the appeal against the order issued u/s 154 of Act pertaining to determination of unabsorbed deprecation rather the addition made in original assessment u/s 143(3) for which appeal was pending before CIT(A) and the appellant had withdrawn that appeal post filing form 3 issued by designated authority. 2.2 That on the facts and circumstances of the case and in law, the Ld. CIT has erred in not appreciating the fact that the appeal was filed before him on 09th Feb 2021, whereas the DTVsVs covers the matter pending before (IT(A) as on 31st January 2020 only.
3. That on the facts and circumstances of the case and in law, the Ld. AO has erred in not allowing carry forward of unabsorbed depredation for AY2001-02 of Rs. 45,25,873/- which is not in accordance of law and the appellant should be allowed to be brought forward to A Y 2015-16 and to carry forward for future years. 3.1. While passing the rectification order u/s 154, the Ld. AO has erred in concluding that the decision on allowance of carry forward of unabsorbed deprecation is out of the preview of scope of section 154 of the Act. 3.2 The Ld. AO has erred in missing to note that while no adverse remark was made in the assessment order u/s 143(3) regarding claim of the appellant on for carry forward of unabsorbed depreciation for AY 2001-02, it is the original rectification order passed u/s 154, wherein such adjustment is made. 3.3 Ld. AO has failed to appreciate that when an adjustment on a particular account can be made u/s 154, then the correction to that adjustment should have been made u/s 154 as well. The treatment given by the Ld. AO is against the principal of natural justice.”
Brief facts of the case are that assessee’s appeal was dismissed by the ld. CIT (A) as infructuous by passing the following order :-
The appeal was instituted on 09.02.2021 against the order dated 11.01.2021 passed under Section 154 r.w.s 143(3) of the Income Tax Act, 1961 by Ward-1(1), Delhi for the assessment year 2015-16. 2.0 It is noted from the appellant's response that the appellant has opted for the Vivad Se Vishwas Scheme vide application dated 22.02.2021. Pursuant thereto, the PCIT, Delhi-1 has certified the full and final payment of Rs 0 as taxes in terms of Form No.5 dated 10.06.2021. In view of the above, the appeal is treated as infructuous as per clause 6 of the Direct Tax Vivad Se Vishwas Act, 2020. 3.0 Accordingly, the appeal is treated as dismissed for statistical purposes.
Against the above order, the assessee is in appeal before us. We have heard both the parties and perused the records.
Ld. Counsel of the assessee submitted that the ld. CIT (A) has wrongly treated the appeal as infructuous. He submitted that it was the order under section 143(3) of the Income-tax Act, 1961 (for short ‘the Act’) in respect of which the assessee went for settlement under Vivad Se Viswas Scheme, 2020 (VSVS). He submitted that the present appeal is arising out of order passed u/s 154 of the Act. Hence, it was pleaded that the ld. CIT(A) should have dealt with the issue.
Per contra, ld. DR for the Revenue did not dispute the above proposition.
Upon careful consideration, we find that it is the plea of the assessee that assessee has not gone for settlement of dispute under VSVS in respect of order passed u/s 154 of the Act. We find that interest of justice demands that this issue be remitted to the file of ld. CIT (A). Ld. CIT (A) should ascertain the correct position of assessee’s applying for VSVS and, thereafter, if the assessee’s contention is found correct that it was order u/s 143(3) which was sought to be settled under VSVS and not the present appeal arising out of order u/s 154 of the Act, ld. CIT (A) shall pass a speaking order in this regard.
In the result, the appeal filed by the assessee is allowed for statistical purposes.
Order pronounced in the open court on this 10th day of January, 2024.