Facts of the Case

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

During the pendency of the appeal, the assessee opted to resolve the tax dispute under the Direct Tax Vivad Se Vishwas Scheme, 2020 (VSVS). The application filed under the scheme was accepted by the tax authorities, and the designated authority issued Form No. 3, determining the amount payable for settlement.

Issues Involved

Whether the appeal pending before the Tribunal should be adjudicated on merits or dismissed as withdrawn after the assessee has opted for and been granted relief under the Vivad Se Vishwas Scheme, 2020.

Petitioner’s (Assessee’s) Arguments

  • The assessee had applied under the Vivad Se Vishwas Scheme, 2020 to settle the pending dispute.
  • The application had been duly accepted by the department.
  • Form No. 3 had been issued by the designated authority.
  • In view of the settlement, the assessee did not wish to pursue the appeal and requested that the same be treated as withdrawn.

A written request along with relevant documents evidencing acceptance under the scheme was placed on record.

Respondent’s (Department’s) Arguments

The Departmental Representative did not object to the withdrawal of the appeal, acknowledging that the assessee had opted for settlement under the statutory dispute resolution mechanism.

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 appellate proceedings was unnecessary.

Important Clarification

The dismissal of the appeal was procedural due to settlement under a statutory scheme and does not amount to adjudication on the merits of the issues raised in the appeal.

Link to download the order –

https://itat.gov.in/public/files/upload/1614249367-151%20Mrs.%20Razia%20Farooqui.pdf

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