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TMI Blog2025 (1) TMI 509X X X X Extracts X X X X X X X X Extracts X X X X ..... the amount payable as determined by the Petitioner in the declaration dated 21.03.2020 as per section 3 (a) of the DTVSV Act and grant the refund as sought in the same. b. That the Hon'ble Court may be pleased to issue under Article 226 of the Constitution of India appropriate writ or order or direction including a writ in the nature of 'Mandamus' directing the Respondent No. 2 to accept the amount payable as per section 3 (a) of the DTVSV Act as determined by the Petitioner in the declaration dated 21.03.2020 filed in Form 1 and 2 and grant the refund as claimed in the same. c. That this Hon'ble Court may be pleased to issue under Article 226 of the Constitution of India an appropriate writ or order or direction including a writ in the nature of 'Prohibition' restraining the Respondent no. 3 from disposing of the appeals pending before him and the Respondent no. 1 and 2 from recovering the outstanding demand disputed in appeals pending before the Respondent no. 3. d. That this Hon'ble Court may be pleased to issue an appropriate direction or order restraining the Respondents from initiating the recovery proceedings with respect of the 'dis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chandrashekhar, the learned counsel for the Respondents, submitted that the Petitioner's case was incorrectly treated as a "search case" for computation of the amount payable under the DTVSV Act. He submitted that this error is acknowledged and will be corrected as stated in paragraph 34 of the Principal Commissioner's Affidavit in Reply dated 17 July 2021. 9. Mr. Chandrashekhar, however, submitted that there is no merit whatsoever in the Petitioner's second contention. He submitted that this contention was clearly in the nature of a belated afterthought. This contention was raised after the Petitioner conceded to adding Rs. 2,02,50,919/- under Section 68 of the Income Tax Act. This attempt was only to secure the additional benefits under the DTVSV Act, even though the Petitioner was not entitled to such benefits. Accordingly, Mr. Chandrashekhar submitted that there is no illegality or arbitrariness involved in not considering this amount to determine the disputed tax. 10. Mr. Chandrashekhar submitted that there was no breach of the CBDT Circular dated 04 December 2020 because the circular provides that any additional ground filed on or before 31 January 2020 (specified date) cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the exemption since the transaction is properly covered by section 10 (38) of the Act In as much as from the clarifications relating to the nature of your assessee's transactions & the stock exchange position of Sunrise Asian Limited it seems clear that your assessee is eligible to claim the requisite exemption u/s. 10 (38), your assessee voluntarily offers the LTCG of Rs. 2,02,50,919/- on sale of 46250 shares of Surise Asian Limited to income tax. This voluntary offering of income is in light of recent tax controversies surrounding the claiming of exemption of LTCG on disinvestment of equity shares. Thereby your assessee is voluntarily giving up the claim of LTCG exemption in order to buy peace of mind and to avoid any tax controversies and litigations. Penalty Proceedings under the Act As is evident from the above, the bonafides of the transaction are not in question & that your assesse has voluntarily agreed to offer the exempt LTCG to income tax, there is every reason to believe that true and complete particulars of the facts have already been provided by the assessee In that light, your assessee pleads before your honours to avoid the initiation of any penal pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o added amounts. In the statement of facts filed along with the appeal memo, the Petitioner contested the additions made in the assessment order only for the limited purpose of quashing the penalty order. This is evident from the Appeal Memo at Exhibit-F (pages 53 to 62 of the paper book of this Petition). 22. When both Appeals were pending, the DTVSV Act 2020 came into force, providing for an amnesty scheme. Section 3 of this Act provides that subject to the provisions of this Act, where declarant files under the provisions of this Act on or before the last date, a declaration to the designated authority in accordance with the provisions of Section 4 in respect of tax arrears, then, notwithstanding anything contained in the Income-tax Act or any other law for the time being in force, the amount payable by the declarant under the Act shall be as specified in the table in Section 3 of the said Act. 23. The Table in Section 3 of the DTVSV Act refers to the computation of the amount payable based on the amount of the disputed tax. The expression "disputed tax" is defined under Section 2(j) of the DTVSV Act and, in the context of the present Petition, is to be computed under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion of Rs. 2,02,50,919/-on account of LTCG under Section 68 of the Income Tax Act. This attempt was made after the filing of the declaration under the DTVSV Scheme. 28. Though the learned counsel for the Petitioner tried to contend that for the period between 27 January 2017 and 31 January 2020, the Petitioner made attempts to amend the Appeal Memo by raising a challenge to the addition of the amount of Rs. 2,02,50,919/- and the Petitioner was unable to do so account of transitional issues and software glitches, we find that there is absolutely nothing on record to substantiate this contention. Assuming that such attempts were made, the minimum expected was some correspondence on this issue, which would have included some grievances about transitional issues or software glitches. Besides, it is unlikely that the Petitioner, having explicitly conceded to the addition of Rs. 2,02,50,919/- towards the LTCG claim and paid tax thereon, would have turned around and challenged such addition when such addition was based on the Petitioner's concession or rather acknowledgement. 29. Besides, if the Petitioner was indeed and seriously aggrieved by adding Rs. 2,02,50,919/- in the Assessment ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... additions. However, even at that point in time, there is no material on record to show that the Petitioner retracted from the concession given regarding the addition of Rs. 2,02,50,919/-, either by raising an additional ground or otherwise in such an appeal. Only after the DTVSV Act came into force, or rather, only after the CBDT issued its Circular dated 04 December 2020, was an attempt made by the Petitioner to belatedly amend the Appeal Memo and challenge the addition of Rs. 2,02,50,919/-. 33. While giving the Petitioner benefits of the DTVSV Scheme, the Respondents correctly refused to consider this belated attempt to amend the Appeal Memo, claiming that even Rs. 2,02,50,919/- constituted a "disputed tax". Such approbation and reprobation were quite correctly not appreciated by the Respondents. The Respondents' approach is consistent with the DTVSV Act and the CBDT circular dated 04 December 2020. 34. The DTVSV Act aims to settle tax disputes pending in Courts and other adjudicatory authorities as of the specified date. This Act is not some licence to revive settled disputes and, based thereon, claim refunds of the tax paid without demur or expand the scope of the dispute ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e computation could not be at the rate of 125% but had to be at the rate of only 100%. 38. The decision in Bhupendra Mehta (Supra) supports the Petitioner's case regarding the computation of the tax payable amount at 100% instead of 125%. The Respondents conceded this position at the stage of arguments and in the Principal Commissioner's Affidavit dated 17 July 2021. Accordingly, limited interference on this aspect is called for in this matter. 39. In the above regard, we refer to the averments in paragraph 34 of the Principal Commissioner's Affidavit dated 17 July 2021. The same is transcribed below for the convenience of reference: - "34. However, subsequently, based on the decision of the Hon'ble Bombay High Court in the case of Bhupendra Harilal Mehta Vs Principal Commissioner of Income Tax, Mumbai and Others dated 27.04.2021 in Writ Petition No.586 of 2021, assessee's case has been treated as a non-search case for determination of amount payable under DTVSV and the amount payable under DTVSV is calculated @100%. Accordingly, a revised Form 3 determining the amount payable @ 100% of the disputed tax for A.Y. 2014-15 is being issued by the Competent Authority." 40. ..... 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