Appeal filed with Delay shall be Treated as 'Pending', Eligible to be Settled under VSV Scheme: Delhi HC [Read Order]

A division bench of the Delhi High Court has held that an appeal filed with delay shall be treated as “pending” for the purpose of settlement under the Vivad Se Vishwas Scheme.

The assessee, M/s Medeor Hospital Limited, has contended that there is no requirement under the Act that the appeal should be filed in time or that the appeal should have been ‘admitted’ before the specified date.

However, the designated authority, rejected the declaration of the petitioner qua the quantum appeal holding that the same cannot be treated as “pending” as on the date of declaration.

After hearing both sides, Justice Manmohan and Justice Manmeet Pritam Singh Arora observed that when a section contemplates pendency of an appeal, what is required is that an appeal should be pending and in such a case there is no need to introduce the qualification that it should be valid or competent.

“Though Section 10 of the VSV Act gives power to the CBDT to issue directions, yet this Court is of the view that the said Section is similar to Section 119 of the Act, 1961. Consequently, the CBDT under Section 10 of VSV Act cannot issue circulars adverse to the assessee,” the Court said.

It was observed that the FAQ No.59 of Circular No.21/2020 dated 4th December, 2020 issued by CBDT to the extent it contemplates admission of appeal before filing of declaration as a condition precedent in order for the appeal to be treated as pending and to be eligible for settlement under the VSV Act is contrary to law.

Granting relief to the assessee, the bench held that “keeping in view the aforesaid, the Forms 3 dated 23rd January, 2021 and 12th February, 2021 attached as Annexures P-16 and P-21 as well as the FAQ No.59 of Circular No.21/2020 dated 4th December, 2020 issued by CBDT to the extent mentioned hereinabove are quashed and respondent No.1 is directed to treat the appeal filed against the assessment order under Section 143(3) for assessment year 2014-15 before CIT(A) on 24th May, 2019 as pending as on 31st January, 2020. The respondents are also directed to issue revised Forms 3 by settling both the appeals against the assessment order for assessment year 2014- 15 (i.e. quantum appeal pending before CIT(A) and the appeal against levy of penalty pending before ITAT) in accordance with the provisions of VSV Act within eight weeks.”

To Read the full text of the Order CLICK HERE

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