TMI Blog2022 (7) TMI 1089X X X X Extracts X X X X X X X X Extracts X X X X ..... pted by issuance of certificate under Section 5(1) of the Act, dated 20.01.2021 (Annexure-14), appeal pending before ITAT, Ranchi filed on 13.03.2019 (Annexure-9) and the appeal pending before the CIT (Appeals), Ranchi filed on 24.02.2020 pertaining to Assessment Year 2012-13 were deemed to have been withdrawn. Once the said appeals are deemed to have been withdrawn by operation of law, the same cannot be revived or restored merely because a declarant, under mistaken notion, has filed a fresh declaration, which was, subsequently, rejected by the Designated Authority. If the said situation is allowed to operate, the same would have devastating effects and would prejudice the entire Scheme framed by the Parliament. If filing of one declaration after another is permitted, then even the provisions of Section 7 of the Scheme would be rendered futile which provides, inter alia, that any amount paid in pursuance of a declaration, shall not be refundable under any circumstances. An assessee, taking advantage of filing second declaration and its rejection by the Authority, can contend, inter alia, that its original declaration has lost its force in the eyes of law and can claim refund of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he petitioner praying therein for the following reliefs:- (i) For issuance of an appropriate writ, order or direction to call for and quash the decision of respondent no.1 dated 15.03.2021, wherein the declaration/revised declaration filed by the petitioner under the Direct Tax Vivad Se Vishwas Act, 2020 (hereinafter to be referred as the Act, 2020 ) has been rejected by wrongly relying upon the provisions of Section 9(c) of the said Act. (ii) For issuance of further appropriate writ, order or direction including writ of mandamus, directing the respondent authorities to act in terms of the certificate issued in Form-3 under sub-section (1) of Section 5 of the Act, 2020 (vide Annexure-14) after granting the benefit of adjustment of the amount already paid by the petitioner for the assessment year 2012-13, which is duly reflected in the official portal of the respondent-authorities itself. (iii) For issuance of further appropriate writ, order or direction, including writ of declaration, declaring that the action of the respondent authorities in rejecting the declaration/revised declaration filed by the petitioner under the Act, 2020 is wholly illegal and arbitrary an ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nter alia, that subsequent to filing of declaration by the declarant, Designated Authority was required to determine the amount payable by the declarant under the Scheme and a certificate to that effect was to be issued by the Designated Authority in terms of Section 5(1) of the Scheme. 4. It is the case of the petitioner that for the Assessment Year 2012- 13, assessment order under Section 143(3) of the Income Tax Act was passed, wherein, against its declared income of Rs. 10,48,440/-, the net taxable income was determined at Rs. 2,41,80,980/- (Annexure-5). The said assessment order was subject matter of challenge under Section 264 of the I.T. Act, and, vide order dated 28.03.2017, said assessment order was set aside by the Principal Commissioner of Income Tax with a direction to the Assessing Officer to frame de novo assessment by making fresh enquiries, and, pursuant to the aforesaid order passed under Section 264, fresh de novo Assessment Order dated 29.12.2017 was passed, wherein income of the petitioner was enhanced from Rs. 10,48,440/- to Rs. 2,62,71,970/-. Being aggrieved by the said Assessment Order, petitioner preferred statutory appeal under Section 250 of the I.T. Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ot adjusted at the time of acceptance of its declaration, with an alleged remark of mismatch . 9. The petitioner, immediately after receipt of certificate dated 20.01.2021, approached the Respondent-authorities and explained them regarding the amount shown as mismatch and requested the Respondentauthorities to rectify declaration certificate issued in Form-3. However, Petitioner was verbally informed that since certificate has already been issued, Petitioner should file revised declaration and, if such revised declaration is filed by the Petitioner, tax which has already been paid by the Petitioner and not reflected in the certificate would be rectified and, if any amount is found refundable to the Petitioner, same would be refunded to it. Accordingly, Petitioner filed a revised declaration on 23.01.2021 before the Respondent-authority. However, said declaration was rejected vide order dated 15th March, 2021 by placing reliance upon Section 9(c) of the Scheme. Said revised/fresh declaration dated 23.01.2021 was rejected by the Designated Authority on the ground that Charge-sheet No. 12 dated 31.12.2020 has been submitted in Case No. AC1 2018 A0007 in which one of the Director ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the Scheme accepting declaration of the Petitioner, the Designated Authority has become functous officio and even if the revised declaration filed by the Petitioner was rejected, Petitioner would still be entitled to the benefit under Section 3 read with Section 5 of the Scheme, as its original declaration dated 24.12.2020 was already accepted vide order dated 20.01.2021. It has been vehemently argued that at the time of acceptance of the original declaration, Respondent-authorities committed error in not granting adjustment of the entire tax paid by the Petitioner prior to filing of the declaration and it was contended that had the entire tax amount paid by the Petitioner been adjusted at the time of original declaration itself, there would have been no occasion for the Petitioner to file revised declaration and the Petitioner, as against an amount of Rs. 9,08,075/- determined as payable in the certificate issued to the Petitioner in Form-3, would have been entitled for refund of an amount of Rs. 20,96,726/-. Further, while placing reliance upon Para-38 of the writ petition, it has been stated that Petitioner, in the writ application, has clearly stated, inter alia, that on no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the legislature, in its wisdom, with a definite purpose, has carved out exceptions as provided under Section 9 of the Scheme and since, at the time of submission of revised/fresh declaration dated 23.01.2021, prosecution was already initiated under the Prevention of Corruption Act, 1988 against the Director of the Petitioner-company, said revised/fresh declaration has been rightly rejected by the Designated Authority. Reliance was placed upon the decision of the Hon ble Supreme Court in the case of Grid Corporation of Orissa Ltd. Vs. Eastern Metals and Ferro Alloys Anr., reported in (2011) 11 SCC 334 , to contend, inter alia, that purposive construction of a Statute should be advanced in furtherance of the objective of the provisions of the statute. 14. Ms. Amrita Sinha further, by placing reliance upon decision of the Hon ble Supreme Court in the case of Shashi Balasubramanian, reported in (2006) 204 ELT 193 (SC), contended, inter alia, that the term prosecution has been instituted would not only mean that charge-sheet has been filed and cognizance has been taken, and, on the strength of the above, it was contended that since the criminal case was instituted in the y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Authority, in terms of Section 5 of the Scheme, was required to determine the amount payable by the declarant in accordance with the provisions of the Scheme and to grant certificate to the declarant containing particulars of tax arrears and the amount payable by the declarant after such determination. The declarant was further liable to pay the amount determined under sub-section (1) of Section 5 within 15 days of receipt of the certificate, and, Section 5(3) clearly provided, inter alia, that every order passed under Section 5(1) would be conclusive as to the matter stated thereunder and no matter covered by such order shall be reopened in any other proceeding under the Income Tax Act. For the sake of ready reference, Section 5 of the Scheme is quoted herein-under:- 5. (1) The designated authority shall, within a period of fifteen days from the date of receipt of the declaration, by order, determine the amount payable by the declarant in accordance with the provisions of this Act and grant a certificate to the declarant containing particulars of the tax arrear and the amount payable after such determination, in such form as may be prescribed. (2)The declarant shall pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Appeals), in respect of the disputed income or disputed interest or disputed penalty or disputed fee and tax arrear shall be deemed to have been withdrawn from the date on which certificate under sub-section (1) or Section 5 is issued by the designated authority. 19. Thus, once a certificate under sub-section (1) of Section 5 is issued by the Designated Authority, any appeal pending before ITAT or Commissioner (Appeals) in respect of the disputed amount and/or tax arrears shall be deemed to have been withdrawn. Meaning thereby, in the instant case, after the declaration of the Petitioner-declarant was accepted by issuance of certificate under Section 5(1) of the Act, dated 20.01.2021 (Annexure-14), appeal pending before ITAT, Ranchi filed on 13.03.2019 (Annexure-9) and the appeal pending before the CIT (Appeals), Ranchi filed on 24.02.2020 pertaining to Assessment Year 2012-13 were deemed to have been withdrawn. 20. Once the said appeals are deemed to have been withdrawn by operation of law, the same cannot be revived or restored merely because a declarant, under mistaken notion, has filed a fresh declaration, which was, subsequently, rejected by the Designated Authority. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioner it is entitled to the benefit of original declaration filed by it. Since we have held that the second declaration filed by the petitioner was not maintainable and non est in the eye of law, we refrain ourselves from observing further on the others issues raised by the parties including the issue as to whether revised declaration of the petitioner company could have been rejected due to initiation of the criminal prosecution against one of the Directors of the company. 23. Since, admittedly, Respondents, pursuant to filing of revised/fresh declaration by the Petitioner dated 23rd January, 2021, entertained the said declaration and examined the same on merits and, thereafter, rejected it vide order dated 15.03.2021 which is our opinion has no legal effect, we are of the opinion that equities would be balanced if we direct the parties to comply with the certificate dated 20.01.2021 issued in favour of the petitioner pursuant to original declaration as per section 5(2) of the scheme i.e. within a period of fifteen days from today. If petitioner makes deposit of an amount of Rs.9,08,075/- being the amount determined as payable by the petitioner under the certificate date ..... X X X X Extracts X X X X X X X X Extracts X X X X
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