The Allahabad High Court condoned the three days delay in depositing tax arrears due to sickness.
The petitioner, Digvendra Pratap Singh challenged the order passed by respondent No.3 by which the application of the petitioner for condoning the delay of three days in depositing the balance amount payable by him under the Direct Tax Vivad Se Vishwas Act, 2020 (Act, 2020), has been rejected.
The Parliament enacted the Act 2020 for the resolution of disputed tax. As per the above Act, 2020, the declarant should submit his declaration under section 4 of the Act, 2020 before the designated authority, and thereafter the designated authority, after receiving the declaration submitted by the declarant, will grant a certificate to the declarant containing particulars of the tax arrears and the amount payable after such determination.
It was further contended by counsel for the petitioner that in pursuance of the scheme of the above Act 2020, for the resolution of the tax for the Assessment Year 2010-11, the petitioner submitted his declaration on 5.6.2020 as required under section 4 of the Act, 2020.
After submission of the declaration certificate of designated authority in Form-III as per Section 5 of the Act, 2020 was also uploaded on the portal on 9.11.2020, which was also downloaded by the petitioner on the same day. As per this certificate, the petitioner was required to pay Rs. 18,67,137/- on or before 31.12.2020.
It was further submitted by the counsel for the petitioner that the petitioner also met with an unfortunate accident on 1.11.2021 in which serious injuries were caused in his right knee and he was advised complete bed rest for a period of three days i.e. from 1.11.2021 to 3.11.2021 and in support of his claim, the petitioner has also annexed the medical certificate issued by the doctor as Annexure-8 to the writ petition.
Despite depositing the money in the account of the Income Tax Department, he was not permitted to submit/file Form-IV to entirely avail the benefit of the scheme under the Act 2020 because of the delay of three days in the generation of challan by the bank.
The petitioner moved an application before the Chairman of the Central Board of Direct Taxes on 15.11.2021 with a prayer that appropriate order be issued for condoning the delay of three days in depositing the balance amount towards his tax liability, but the above application was rejected by the impugned order dated 25.8.2022 on the ground that once last date has been mentioned in the notification to deposit the balance tax liability; therefore, the same cannot be extended.
The petitioner challenged the impugned order dated 25.8.2022 on the ground that there was a delay of three days in depositing the balance amount of tax, firstly for the reason that the last date for depositing the balance tax fell on Sunday. Secondly, he could not approach the bank from 1.11.2021 to 3.11.2021 because of the injury to his knee.
While allowing the petition, the Delhi High Court condoned the delay in depositing the balance amount of tax and directed the Income Tax Department to accept the balance amount as stipulated in Form-III on the ground that unforeseen and extraneous circumstances which were beyond the control of the petitioner and resulted in delayed depositing the balance tax can be condoned considering the lockdown period on account of COVID-19 from 25.3.2020.
A coram comprising of Justice Siddhartha Varma and Justice Arun Kumar Singh Deshwal observed that “a delay of three days in depositing the arrears of tax of Rs. 8,67,137/- deserves to be condoned, and the amount balance tax deposited by the petitioner be accepted by the respondents treating the same well within time as per the scheme of Act, 2020 and also the impugned order /letter dated 25.8.2022, passed by Central Board of Direct Tax, is hereby quashed.”
Ami Tandon, Abhinav Gaur, Advocate, Vibhu Rai appeared for the petitioner and Counsel for the respondent Naveen Chandra Gupta
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