The Commissioner Of Income Tax, Chennai v. M/S.original Kerala Jewellers, Chennai-17

IN THE HIGH COURT OF JUDICATURE AT MADRAS DATED : 07.12.2020 CORAM THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAMandTHE HONOURABLE MRS.JUSTICE V.BHAVANI SUBBAROYAN Tax Case Appeal No.976 of 2018 The Commissioner of IncomeTax, Chennai. ...Appellant/RespondentVsM/s.Original Kerala Jewellers,Chennai-17 ...Respondent/Petitioner APPEAL under Section 260A of the Income Tax Act, 1961against the order of the Income Tax Appellate Tribunal, Madras'C' Bench, Chennai, dated 05.3.2018 made in I.T.A.Nos.2987 &2988/Chny/2017 for the assessment year 2008-2009 and 2010-11 andagainst the order of the Commissioner of Income Tax (Appeals)-2Chennai dated 29.09.2017 made in I.T.A.Nos.204, 205 and 206/CIT(A)-2/2016-2017 for the Assessment year 2007-2008, 2008-2009,2010-2011 against the order the Deputy Commissioner of IncomeTax, Non Corporate Circle-2, Chennai 600 034 dated 09.01.2017made in PANIAAAF00104F for the Assessment year 2010-2011. For Appellant: Mrs.R.Hemalatha, SSCFor Respondent : Mr.R.Vijayaraghavan for M/s.Subbaraya Aiyer Padmanabhan Judgment was delivered by T.S.SIVAGNANAM,J This appeal has been filed by the Revenue under Section260A of the Income Tax Act, 1961 ('the Act' for brevity)challengingtheorderdated05.3.2018madeinI.T.A.No.2988/Chny/2017 on the file of the Income Tax AppellateTribunal, Chennai, 'C' Bench ('the Tribunal' for brevity) forthe assessment year 2010-11. 2. The appeal was admitted on 21.12.2018 on the followingsubstantials question of law:“i. Whether the Tribunal was right insetting aside the order of penalty issuedunder Section 271(1)(c) especially when theassessee has not offered any explanationsatisfactorily to the Assessing Officer ? https://hcservices.ecourts.gov.in/hcservices/ ii. Whether Explanation (1) would comeinto play once no explanation is offered bythe assessee and therefore, penalty becomeleviable? And iii. Whether the Tribunal was right inallowing the assessee to raise the plea ofdefective notice issued under Section 274read with Section 271 of the said Act forthe first time before the Tribunal andhaving not done before the Commissioner,whether at all the assessee was prejudicedon account of the said alleged defect?” 3. We have heard Mrs.R.Hemalatha, learned Senior StandingCounselappearingfortheappellant/RevenueandMr.R.Vijayaraghavan, learned counsel appearing on behalf of therespondent/assessee. 4. The learned counsel for the respondent/assessee, oninstructions, submits that the assessee intends to avail thebenefit of Vivad Se Vishwas Scheme ('VVS Scheme' for brevity)and in this regard, the assessee is taking steps to file theapplication/ declaration in Form No.I. 5. 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. 6. In terms of the said Act, the assessee has been given anoption to put an end to the tax disputes, which may be pendingat 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. 6. In terms of the said Act, the assessee has been given anoption to put an end to the tax disputes, which may be pendingat 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. 7. The First Proviso to Section 3 states that in case,where an appeal or writ petition or special leave petition is https://hcservices.ecourts.gov.in/hcservices/ filed by the Income Tax authority on any issue before theAppellate Forum, the amount payable shall be one-half of theamount in the table stipulated in Section 3 calculated on suchissue, in such a manner as may be prescribed. The Second Provisodeals with the cases, where the matter is before theCommissioner (Appeals) or before the Dispute Resolution Panel.The Third Proviso deals with cases, where the issue is pendingbefore the Income Tax Appellate Tribunal. The filing of thedeclaration is as per Section 4 of the Act and the particularsto be furnished are also mentioned in the Sub-Sections ofSection 4. Section 5 of the Act deals with the time and mannerof the payment and Section 6 deals with immunity from initiationof proceedings in respect of offence and imposition of penaltyin certain cases. Section 9 of the Act deals with cases, wherethe Act 3 of 2020 will not be applicable. 8. As observed, the assessee is given liberty to restorethis appeal in the event the ultimate decision to be taken onthe declaration to be filed by the assessee under Section 4 ofthe said Act is not in favour of the assessee. If such a prayeris made, the Registry shall entertain the prayer withoutinsisting upon any application to be filed for condonation ofdelay in restoration of the appeal and on such request made bythe assessee by filing a miscellaneous petition for restoration,the Registry shall place such petition before the Division Benchfor orders. 9. In the light of the above, we direct therespondent/assessee to file Form No.I on or before 28.12.2020andtheCompetentAuthorityshallprocesstheapplication/declaration in accordance with the Act and passappropriate orders as expeditiously as possible preferablywithin a period of six (6) weeks from the date, on which, thedeclaration is filed in the proper form. 10. With this direction, the tax case appeal standsdisposed of with the aforementioned liberty and Consequently,the substantial questions of law are left open. No costs. -s/d- Assistant Registrar True Copy To https://hcservices.ecourts.gov.in/hcservices/ 2.The Commissioner of Income Tax (Appeals)-2Chennai 600 034.Chennai 600 034. 3.The Deputy Commissioner of Income TaxNon Corporate Circle-2Chennai 600 034.Non Corporate Circle-2Chennai 600 034. +1 CC to Mr.T. Ravikumar, Advocate sr 39480. +1 CC to Mr. Subbaraya Aiyar, Advocate sr 39487. T.C.A.No.976 of 2018NR(CO)SP(19/01/2021)