Facts of the Case

The assessee, Mr. Dinesh Kumar Pahuja, had filed an appeal before the Income Tax Appellate Tribunal (ITAT), Allahabad Bench, challenging the order passed by the Commissioner of Income Tax (Appeals) under the Income-tax Act, 1961 for the relevant assessment year.

While the appeal was pending adjudication, the assessee opted to resolve the dispute under the Direct Tax Vivad Se Vishwas Scheme, 2020 (VSVS) introduced for settlement of pending tax disputes. The declaration filed under the scheme was accepted by the designated authority, which issued Form No. 3 determining the amount payable for settlement.

Subsequently, the assessee requested that the appeal pending before the Tribunal be treated as withdrawn.

Issues Involved

Whether the Tribunal should proceed to decide the appeal on merits or dismiss it as withdrawn when the assessee has opted for settlement under the Vivad Se Vishwas Scheme, 2020 and the declaration has been accepted.

 

Petitioner’s (Assessee’s) Arguments

  • The assessee had filed a declaration under the Vivad Se Vishwas Scheme, 2020 to settle the pending dispute.
  • The declaration had been accepted by the tax authorities.
  • Form No. 3 had been issued by the designated authority specifying the payable amount.
  • In view of the settlement, the assessee did not intend to pursue the appeal and sought permission to withdraw the same.

Relevant documentary evidence confirming acceptance under the scheme was also placed on record.

Respondent’s (Department’s) Arguments

The Departmental Representative did not raise any objection to the withdrawal of the appeal, acknowledging that the dispute had been settled under the statutory scheme.

Court Order / Findings

  • The assessee had opted for settlement under the Vivad Se Vishwas Scheme, 2020.
  • The designated authority had issued Form No. 3 confirming acceptance of the declaration.
  • Since the dispute stood resolved under the scheme, continuation of the appellate proceedings would serve no useful purpose.

Important Clarification

The dismissal of the appeal was purely procedural following settlement under a statutory dispute resolution scheme and does not constitute adjudication on the merits of the issues involved.

Link to download the order –

https://itat.gov.in/public/files/upload/1614249238-51%20Dinesh%20Kumar%20Pahuja.pdf

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