British Airways Plc vs DCIT: Appeal Withdrawal Under Vivad Se Vishwas Scheme for AY 2016-17

British Airways Plc vs DCIT: Appeal Withdrawal Under Vivad Se Vishwas Scheme for AY 2016-17

On July 20, 2022, the Delhi Bench ‘D’ of the Income Tax Appellate Tribunal (ITAT), comprising Shri N.K. Billaiya, Accountant Member, and Shri N.K. Choudhry, Judicial Member, heard the case of British Airways Plc vs DCIT, Circle-1(1)(2), International Taxation, New Delhi. The case concerned the assessment year 2016-17, and the appeal was originally filed on August 2, 2019, by British Airways Plc, challenging an order passed by the Commissioner of Income-tax (Appeals)-42, New Delhi, on May 31, 2019.

Background of the Case

British Airways Plc, a renowned international airline operating in India, had filed an appeal against the decision of the Commissioner of Income-tax (Appeals)-42 for the assessment year 2016-17. The details of the dispute were not explicitly mentioned in the order; however, the case proceeded through the appellate process until the introduction of the Vivad Se Vishwas Scheme by the Government of India.

The Vivad Se Vishwas Scheme, introduced in 2020, was designed to reduce tax litigation by allowing taxpayers to settle their disputes with the tax department by paying a specified percentage of the disputed tax amount. Under this scheme, taxpayers could resolve their cases and avoid prolonged litigation, leading to quicker resolution and reduction of pending cases.

Withdrawal of the Appeal

During the hearing on July 20, 2022, the Authorized Representative (AR) for British Airways Plc, Shri Yishu Goel, informed the tribunal that the company had opted for the Vivad Se Vishwas Scheme. As a result, British Airways Plc had submitted an application under the scheme, and the Income Tax Department had issued Form No. 5 on March 5, 2021, indicating the settlement of the dispute.

Given this development, the AR requested the tribunal to allow the withdrawal of the appeal. The request was not contested by the Department’s representative, Shri Sanjay Kumar, Senior DR, who acknowledged the settlement under the Vivad Se Vishwas Scheme.

Tribunal’s Decision

Considering the request for withdrawal and the issuance of Form No. 5 by the Income Tax Department, the tribunal accepted the withdrawal of the appeal. The appeal was dismissed as withdrawn in light of the settlement reached under the Vivad Se Vishwas Scheme. The order was pronounced in the open court on July 20, 2022.

Conclusion

The case of British Airways Plc vs DCIT serves as a significant example of the effectiveness of the Vivad Se Vishwas Scheme in resolving tax disputes amicably. By opting for this scheme, British Airways Plc was able to settle its tax dispute for the assessment year 2016-17 without further litigation, leading to a quicker resolution of the matter.

This decision underscores the value of alternative dispute resolution mechanisms like the Vivad Se Vishwas Scheme in reducing the burden on the judiciary and providing taxpayers with a more efficient path to resolve their disputes. The successful settlement of this case highlights the importance of such schemes in fostering a more collaborative relationship between taxpayers and the tax authorities.

Overall, the dismissal of the appeal following the settlement under the Vivad Se Vishwas Scheme is a positive outcome for both British Airways Plc and the tax department, demonstrating the benefits of resolving disputes through mutual agreement.

British Airways Plc vs DCIT: Appeal Withdrawal Under Vivad Se Vishwas Scheme for AY 2016-17