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2022 (2) TMI 943 - HC - Income TaxBenefit of Vivad se Vishwas Scheme - declaration of the petitioner was rejected on the ground that the CBDT circular dated 04.12.2020 does not cover his case - assessee is not eligible to avail benefit under VSVS as there was no appeal pending as on 31.01.2020 - Condonation of delay - HELD THAT:- What hurts the petitioner is the portion of the clarification contained in the CBDT circular which provides that the application for condonation of delay must have been filed before the date of issuance of circular. The petitioner fulfills all other conditions namely the time for filing appeal has expired during the period from 1st April 2019 to 31st Jan 2020, that he had filed an application for condonation of delay which was pending. He had also filed an appeal before the date of filing of the declaration. We are informed that there is no stage of formal admission of the appeal or condonation application before the tribunal and therefore the reference to this term of admission of appeal in the circular is superfluous. In this context the question arises whether the specification of the filing of the application for condonation before the date of circular is sacrosanct as to destroy the right of assessee to apply for settlement if even though all other conditions are specified. This question has been examined by several High Courts. See case of the Telangana High Court in case of Boddu Ramesh v. Designated Authority [2021 (6) TMI 1054 - TELANGANA HIGH COURT] and MAHESHBHAI SHANTILAL PATEL [2021 (9) TMI 1237 - GUJARAT HIGH COURT] Independently also we are of the view that the stand taken by the department is not sustainable. To begin with the act was framed for resolution of the disputed taxes and the matters connected therewith and thereto. The resolution of disputed taxes is thus prime purpose of enactment of the act. We would therefore adopt an interpretation which would further this intention instead of restricting its scope. More importantly what the CBDT had done under its circular dated 04.12.2020 was to issue a clarification. A clarification by its very nature is declaratory. If for applicability of such clarification a cut off date is introduced it would run counter to the very concept of a clarification. If the CBDT circular is not read-down as to remove the rigors of the cut off date by holding that the same is not sacrosanct the same may suffer from vice of arbitrariness. We are informed that the scheme for settlement was extended from time to time and finally the last extension ended on 31.03.2021. The interpretation that we have adopted therefore does not make a right of a person to seek settlement open ended. It has a terminal point of 31.03.2021 in any case. In the result the petitions are allowed. Impugned orders dated 22.03.2021 are set aside. The declarations of the petitioners shall be accepted. The same would be thereafter dealt with as provided under the Act.
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