Shri K.srikanth v. The Assistant Commissioner Of Income Taxcompany Circle - Ii(4)Chennai

IN THE HIGH COURT OF JUDICATURE AT MADRAS CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMand THE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN Shri K.Srikanth ...Appellant Vs. The Assistant Commissioner of Income TaxCompany Circle - II(4)Chennai. ...Respondent Tax Case Appeals filed under Section 260A of the Income TaxAct, 1961, against the common order of the Income Tax AppellateTribunal, 'D' Bench, Chennai, dated 19.05.2020 made inI.T.A.No.1016/Chny/2012,I.T.A.No.307/Chny/2010,andI.T.A.No.1015/Chny/2012 respectively relating to the AssessmentYear 2001 – 2002, against the order of the AssistantCommissioner of Income Tax, Company Circle II(4) Chennai dated30.04.2012 and made in AAFPS6375K for the Assessment year 2001-2002. against the order of the Commissioner of Income Tax, AppealsIII, Chennai dated 27.03.2012 and made in I.T.A.No.283/2010-2011/A-III and I.T.A.No.420/2008-2009/A-III for the Assessmentyear 2001-2002 respectively. Against the order of the Deputy Commissioner of Income Tax,Company Circle II(4) Chennai 34 dated 08.11.2010 and made inPAN/GIR No. AAFPS6375K for the Assessment year 2001-2002 andorder of the Assistant Commissioner of Income Tax, CompanyCircle II(4) Chennai dated 31.12.2008 and made in PAN/GIR No. for the Assessment year 2001-2002 respectively. For Appellant : Mr.A.S.Sriraman For Respondent : Ms.R.Hemalatha Senior Standing Counsel JUDGMENT [Order of the Court was made by T.S.SIVAGNANAM, J.] These appeals have been filed by the Assessee under Section260 A of the Income Tax Act, 1961 ('the Act' for brevity),challenging the common order dated 19.05.2020 passed by theIncome Tax Appellate Tribunal, 'D' Bench ('the Tribunal' forbrevity) in I.T.A.No.307/Chny/2010, I.T.A.No.1015/Chny/2012 andI.T.A.No.1016/Chny/2012 for the Assessment Year 2001 - 2002. Theappeals were admitted on 31.08.2020 on the following SubstantialQuestions of Law : “1. Whether the reopening of theassessment under Section 147 of the Income TaxAct, 1961 is valid in law? 2. Whether the Commissioner of Income Taxwas justified in invoking the power under Section263 of the Act and the twin conditions prescribedhave been complied with concurrently? 3. Whether the payment towards the bankliability under OTS settlement scheme wouldamount to diversion of income by overriding titleas against the application of income for suchsale within the scope of Section 48 of the Act? 4. Whether the payment of bank liabilityunder OTS scheme would constitute alternatively asexpenses incurred in connection with the transferfor removing the encumbrance on the transferredasset within the scope of Section 48 of the Act?” 2. We have heard Mr.A.S.Sriraman, learned counsel appearingfor the appellant/assessee and Ms.R.Hemalatha, Learned SeniorStanding Counsel for the respondent/revenue. 3. It may not be necessary for this Court to decide theSubstantial Questions of Law framed for consideration on accountof certain subsequent developments. The Government of Indiaenacted the Direct Tax Vivad Se Vishwas Act, 2020 (Act 3 of2020) to provide for resolution of disputed tax and for mattersconnected therewith or incidental thereto. The Act of theParliament received the assent of the President on 17[th] March2020 and published in the Gazette of India on 17[th] March 2020. 4. In terms of the said Act, the assessee has been given anoption to put an end to the tax disputes, which may be pending https://hcservices.ecourts.gov.in/hcservices/ 3. It may not be necessary for this Court to decide theSubstantial Questions of Law framed for consideration on accountof certain subsequent developments. The Government of Indiaenacted the Direct Tax Vivad Se Vishwas Act, 2020 (Act 3 of2020) to provide for resolution of disputed tax and for mattersconnected therewith or incidental thereto. The Act of theParliament received the assent of the President on 17[th] March2020 and published in the Gazette of India on 17[th] March 2020. 4. In terms of the said Act, the assessee has been given anoption to put an end to the tax disputes, which may be pending https://hcservices.ecourts.gov.in/hcservices/ at different levels either before the First Appellate Authorityor before the Tribunal or before the High Court or before theHon'ble Supreme Court of India. Under Section 2(j) “disputedtax” has been defined. In terms of Section 3, where a declarantmeans a person, who files a declaration under Section 4 on orbefore the last date files a declaration to the designatedauthority in accordance with the provisions of Section 4 inrespect of tax arrears, then, notwithstanding anythingcontained in the Income Tax Act or any other law for the timebeing in force, the amount payable by the declarant shall bedetermined in terms of Section 3(a-c) thereunder. 5. The First Proviso to Section 3 states that in case, wherean Appeal or Writ Petition or Special Leave Petition is filed bythe Income Tax authority on any issue before the AppellateForum, the amount payable shall be one-half of the amount in thetable stipulated in Section 3 calculated on such issue, in sucha manner as may be prescribed. The second proviso deals with thecases, where the matter is before the Commissioner (Appeals) orbefore the Dispute Resolution Panel. The third proviso dealswith cases, where the issue is pending before the Income TaxAppellate Tribunal. The filing of the declaration is as perSection 4 of the Act and the particulars to be furnished arealso mentioned in the Sub Sections of Section 4. Section 5 ofthe Act deals with the time and manner of the payment andSection 6 deals with Immunity from initiation of proceedings inrespect of offence and imposition of penalty in certain cases.Section 9 of the Act deals with cases, where the Act 3 of 2020will not be applicable. 6. We are informed by the learned counsel for theappellant/assessee that the assessee has already filed thedeclarations under Section 4 of the Act on 23.11.2020. 7. In the light of the fact that the assessee has alreadyavailed the benefit under the Act, no useful purpose would beserved in keeping these appeals pending. At the same time,safeguarding the interest of the assessee in the event the orderto be passed by the Department under the Act is not in favour ofthe assessee. Accordingly, the Tax Case Appeals stand disposedof on the ground that the assessee has already filed adeclaration and the Department shall process the application atthe earliest in accordance with the said Act and communicate thedecision to the assessee at the earliest. As observed, theassessee is given liberty to restore these appeals in the eventthe ultimate decision to be taken on the declarations filed bythe assessee under Section 4 of the said Act is not in favour ofthe assessee. If such a prayer is made, the Registry shallentertain the prayer without insisting upon any application tobe filed for condonation of delay in restoration of the appeals and on such request made by the assessee by filing aMiscellaneous Petition for Restoration, the Registry shall placesuch petition before the Division Bench for orders. 8. With this observation, the Tax Case Appeals standdisposed of with the aforementioned liberty and Consequently,the Substantial Questions of Law are left open. No costs.Connected miscellaneous petitions are closed. s/d- Assistant Registrar and on such request made by the assessee by filing aMiscellaneous Petition for Restoration, the Registry shall placesuch petition before the Division Bench for orders. 8. With this observation, the Tax Case Appeals standdisposed of with the aforementioned liberty and Consequently,the Substantial Questions of Law are left open. No costs.Connected miscellaneous petitions are closed. s/d- Assistant Registrar True Copy Sub-Assistant Registrar SsdTo1.The Income Tax Appellate Tribunal, 'D' Bench, Chennai.2.The Assistant Commissioner of Income TaxCompany Circle II(4)Chennai 3.The Commissioner of Income TaxAppeals III, Chennai4.The Deputy Commissioner of Income TaxCompany Circle II(4)Chennai 34.5.The Assistant RegistrarAE Main SectionHigh Court, Madras 104. +1 CC to Mr.T. Ravikumar, Advocate sr 41616. T.C.A.Nos.246 to 248 of 2020SV(CO)SP(02/02/2021)