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2021 (8) TMI 1103 - HC - Income TaxInterest sought to be recovered as disputed tax from the assessee in Form-3 under the DTVSV Scheme - interest sought to be recovered as disputed tax be understood as the one paid pursuant to Section 244A and not Section 234D - HELD THAT - We quash and set aside Form-3 dated 31st March, 2021 issued by Respondent No.1 for Assessment Year 2010- 11 as being without jurisdiction, the Respondent No.1 Designated Authority having no power or authority to add/include this amount to the disputed tax under the provisions of the DTVSV Act. We direct Respondent No.1 to issue fresh Form-3 to Petitioner determining the amount of disputed tax in accordance with the above discussion within three weeks from the date of pronouncement of this order and thereafter Petitioner to make payment of the disputed tax so determined within a period of two weeks of the issuance of revised Form -3.
Issues:
1. Interpretation of provisions under the Direct Tax Vivad Se Vishwas (DTVSV) Act. 2. Recovery of interest under Section 244A of the Income Tax Act. 3. Jurisdiction and authority of the Designated Authority under the DTVSV Act. Analysis: Issue 1: Interpretation of provisions under the Direct Tax Vivad Se Vishwas (DTVSV) Act The judgment addressed the interpretation of provisions under the DTVSV Act, specifically focusing on the applicability of the first proviso to Section 3 of the Act. It was determined that in a pending Appeal where the first proviso to Section 3 of the DTVSV Act is applicable, the amount payable by the Petitioner would be 50% of the disputed tax. This interpretation was based on a detailed analysis of the Act and the specific circumstances of the case. Issue 2: Recovery of interest under Section 244A of the Income Tax Act The Respondents had sought to recover an amount as disputed tax from the assessee under the DTVSV Scheme, claiming it to be the interest awarded to the assessee under Section 244A. The Petitioner argued that the interest sought to be recovered should be understood as the one paid pursuant to Section 244A of the IT Act and not Section 234D. The Court agreed with the Petitioner's submission, holding that there is no provision in the DTVSV Act authorizing the recovery of interest paid earlier under Section 244A by adding it to the disputed tax. As a result, the Court quashed and set aside the Form-3 issued by the Designated Authority, directing a fresh determination of the disputed tax amount. Issue 3: Jurisdiction and authority of the Designated Authority under the DTVSV Act The Court examined the jurisdiction and authority of the Designated Authority under the DTVSV Act in adding the interest amount to the disputed tax. It was concluded that the Designated Authority had no power or authority to include the interest amount in the disputed tax under the provisions of the DTVSV Act. Therefore, the Court directed the Designated Authority to issue a fresh Form-3 to the Petitioner for determining the disputed tax amount in accordance with the judgment, emphasizing the lack of jurisdiction in the initial determination. In conclusion, the judgment provided a detailed analysis of the issues surrounding the interpretation of provisions under the DTVSV Act, the recovery of interest under Section 244A of the Income Tax Act, and the jurisdiction of the Designated Authority. The decision clarified the legal position on these matters and provided specific directions for the resolution of the dispute in the case at hand.
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