TMI Blog2022 (5) TMI 1388X X X X Extracts X X X X X X X X Extracts X X X X ..... g the of the Direct Tax Vivad Se Vishwas Act, 2020, is to bring a closure of disputes in respect of tax arrears. Whether the petitioner had correctly or wrongly availed the benefit of Section 57(F) of the Income Tax Act or not cannot be re-opened once again under Section 263 of the Income Tax Act, 1961. Once the petitioners had opted to settle the dispute under the Direct Tax Vivad Se Vishwas Act, 2020, the proceedings initiated under Section 263 have to go. If on the other hand the respective petitioners had not filed Form 1 and 2 or not accepted with the issue of Form 3, the Impugned Notice seeking to re-open the assessment under Section 263 of the Income Tax Act, 1961 could be justified. The Finance Minister in her speech on 01.02.2020 announced the the Direct Tax Vivad Se Vishwas Scheme to bring down the litigation. The Government intended to reduce the litigation, so that the taxpayers can buy peace with the department. The aforesaid scheme was to be implemented on 30.06.2020. The taxpayers whose appeals were pending at any level were entitled to avail benefit of the scheme. Therefore, there is no justification in proceeding further with the impugned proceedings initi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as the petitioners are concerned, though the petitioners have challenged the impugned notices issued to the petitioners on 22.02.2021, the petitioners were directed to approach the jurisdictional Principal Commissioner of Income Tax/1st respondent vide order dated 09.09.2021 of this High Court in these writ petitions. Pursuant to which, now the impugned orders have been passed by the 1st respondent in respective writ petitions where by a different views has taken by the Principal Commissioner in the case of the petitioners other brother namely G.Vijaykumar vide order dated 05.07.2021. 7. The challenge to the impugned notices issued under Section 263 of the Income Tax Act, 1961 by the petitioner is primarily on the ground that these notices are without jurisdiction in the light of the fact that the petitioners opted to settle their cases under the direct tax/Vivad Se Vishwas Scheme under the Direct Tax Vivad Se Vishwas Act, 2020 read with Vivad Se Vishwas Rule 2020. 8. It is submitted that during the pendency of the appeals before the Commissioner (Appeals) against the orders passed on 27.12.2018. The petitioners filed Form 1 and Form 2 as per the aforesaid scheme pursuant to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... which would otherwise be cause to them will be avoided. A humane and considerate administration of the relevant provisions of the Income-tax Act would go a long way in allaying the apprehensions of the assessees and if that is done in the true spirit, no assessee will be in a position to charge the Revenue with administering the provisions of the Act with ''an evil eye and unequal hand''. 14. Finally, the learned counsel for the petitioners referred to a passage from the decision of the Hon'ble Gujarat High Court and sought to persuade this court that principles of promissory estoppel also will apply. Relevant passage of the Hon'ble Division Bench of the Gujarat High Court is reproduced below:- ''Whether or not it amounted to promissory estoppel and created a legal right apart, the question was required to be examined from the standpoint of the credibility of the department. Would it not cause greated harm to the department itself if assessees who respond to its appeal and desire to cleanse themselves of the past sins are deterred from doing so? In a way, in the long run, it might be counter productive to do so. All three questions cannot be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o be without jurisdiction inasmuch as the scope of appeal that was pending before the Appellate Commissioner was limited. Thereafter, the petitioner had filed objections dated 26.02.2021 and also sought time for 10 days to submit and substantiate his claims. 19. It is the specific case of the respondents that the petitioners were not the owners of the land which was sold by their father. It is further submitted that the said Karpagam Studio was a partnership firm where the petitioners' father was a partner along with other. Partners which did not include the petitioners. The profits from the sale was distributed among the four siblings for a sum of Rs.12,50,00,000/- ( Rs.3,12,50,000/- each) among the four siblings. 20. It is submitted that if the petitioners had offered this amount correctly as income from other sources while filing returns under Section 134 of the Income Tax Act, 1961 instead of treating it as a capital gain under Section 53(c) of the IT Act and for claiming exemption under Section 54 F of the IT Act , 1961 issued to the petitioners, there would have been no necessity for initiating proceedings under Section 263 of the Act. 21. The learned Junior Stan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The learned counsel for the petitioners further submits that once Form-3 was issued by the Designating Authority, the third respondent had no role as the Principal Commissioner to issue notice under Section 263 of the Income Tax Act, 1961 to the petitioners. It was without jurisdiction. It is further submitted that the intention of the Act, is evident from the Finance Minister speech of First February, 2020 wherein in para 126 it has been stated as follows:- 126. No Dispute but Trust Scheme Vivad Se Vishwas Scheme Sir, in the past our Government has taken several measures to reduce tax litigations. In the last budget, Sabaka Vishwas Scheme was brought into reduce litigation in indirect taxes. It resulted in settling over 1,89,000 cases. Currently, there are 4,83,000 direct tax cases (Appeals), ITAT, High Court and Supreme Court. This year, I propose to bring a scheme similar to the indirect tax Sabka Vishwas for reducing litigations even in the direct taxes. Under the proposed Vivad Se Vishwas' Scheme, a taxpayer would be required to pay only the amount of the disputed taxes and will get complete waiver of interest and penalty provided he pays by 31st March, 2020. T ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ou and nine others had sold immovable property for consideration of Rs.3 Crores. In your return of income you have claimed deduction u/S.54 and have not admitted income from capital gains. Hence, the assessment u/s. 143(3) has been reopened to assess the same. For the reasons cited above, the reopening u/s. 147 of Income Tax Act. Sd/xxxxx (S.Samuthiram) Income-tax Officer Non Corporate Ward 17(4) Chennai 34. Circular in W.P.No.6367 of 2021 GOVERNMENT OF INDIA INCOME TAX DEPARTMENT OFFICE OF THE INCOME TAX OFFICER, NON CORPORATE WARD 17(4) Room No.518, 5th Floor, BSNL Tower-I Building, No.16, Greams Road, Chennai 600 006. 004-28295279, Email: Chennai.ito.nc17.4@incometax.gov.in NCW. 17(4) /AGKPR6315B/2018-19 Date:11.07.2018 RECD. ON.11.07.2018 TIME: 16.00 To Shri G.Rajkumar, No.11/477 4th Sector 19th Street, K.K.Nagar, Chennai 600 078. Sir, Sub : Reopening of assessment in your own case- Asst.year 2011-12-reg. Ref : Your letter dated 06.10.2017. Vide letter cited you have requested for Reasons recorded for reopening the assessment u/S.148 of the I ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the Impugned Notice under Section 263 of the Income Tax Act, 1961 was without jurisdiction inasmuch as the petitioners have settled the case under the Direct Tax Vivad Se Vishwas Act, 2020. 39. The question therefore that arises for consideration is whether the impugned proceedings initiated after the petitioners opted to settle the dispute under the Direct Tax Vivad Se Vishwas Act, 2020 are sustainable or not? 40. The expression disputed tax has been denied in Section 27 of the Direct Tax Vivad Se Vishwas Act, 2020 reads as under: (j) disputed tax , in relation to an assessment year or financial year, as the case may be, means the income-tax, including surcharge and cess (hereafter in this clause referred to as the amount of tax) payable by the appellant under the provisions of the Income-tax Act, 1961, as computed hereunder:- (A) in a case where any appeal, writ petition or special leave petition is pending before the appellate forum as on the specified date, the amount of tax that is payable by the appellant if such appeal or 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 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icial Gazette; (m) prescribed means prescribed by rules made under this Act; (n) specified date means the 31st day of January, 2020; (o) tax arrear means,- (i) the aggregate amount of disputed tax, interest chargeable or charged on such disputed tax, and penalty leviable or levied on such disputed tax; or (ii) disputed interest; or (iii) disputed penalty; or (iv) disputed fee, as determined under the provisions of the Income-tax Act. 41. As per Section 3 of the the Direct Tax Vivad Se Vishwas Act, 2020, notwithstanding anything contained in the Income Tax Act or any other law for the time in force the amount payable by a declarant shall be as specified in the table to the said section. 42. As per Section 4(6) of the Direct Tax Vivad Se Vishwas Act, 2020, the declarations filed under Section(1) shall be presumed to have never been made if : - a) Any material particular furnished in the declaration is found to be false at any stage; b) The declarant violates any of the conditions referred to in this Act; c) The declarant acts in any manner which is not in accordance with the undertaking given by him under sub-section(5) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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