HPS Concrete Pvt. Ltd. vs DCIT Central Circle, Ghaziabad: Withdrawal of Appeal Under Vivad Se Vishwas Scheme for AY 2017-18

Case Overview: HPS Concrete Pvt. Ltd. vs DCIT Central Circle, Ghaziabad

Case Number: ITA 6220/DEL/2019

Appellant: HPS Concrete Pvt. Ltd., New Delhi

Respondent: DCIT Central Circle, Ghaziabad

Assessment Year: 2017-18

Case Filed On: 2019-07-22

Order Type: Final Tribunal Order

Date of Order: 2022-07-06

Pronounced On: 2022-07-06

Introduction

The case of HPS Concrete Pvt. Ltd. vs DCIT Central Circle, Ghaziabad pertains to an appeal filed by HPS Concrete Pvt. Ltd., a private limited company based in New Delhi, challenging the assessment order passed by the Deputy Commissioner of Income Tax (DCIT), Central Circle, Ghaziabad, for the assessment year 2017-18. The appellant decided to withdraw the appeal under the Direct Tax Vivad Se Vishwas Scheme, 2020, leading to its dismissal by the Income Tax Appellate Tribunal (ITAT), Delhi Bench ‘B’, on July 6, 2022.

Background of the Case

HPS Concrete Pvt. Ltd. filed its appeal before the ITAT on July 22, 2019, challenging the order issued by the Commissioner of Income Tax (Appeals)-IV, Kanpur, dated April 30, 2019. The appeal arose from the assessment order for the year 2017-18, wherein certain tax arrears and penalties were imposed on the company. The company sought relief from these tax liabilities by appealing to the ITAT.

However, with the introduction of the Direct Tax Vivad Se Vishwas Scheme, 2020, the appellant opted to resolve the dispute through this scheme, which offered an opportunity to settle tax arrears without further litigation.

The Vivad Se Vishwas Scheme, 2020

The Direct Tax Vivad Se Vishwas Scheme, 2020, was introduced by the Indian government as a mechanism to resolve long-pending tax disputes. The scheme provided taxpayers with the option to settle their tax liabilities by paying a defined percentage of the disputed amount, thus avoiding the uncertainty and expense of prolonged litigation.

In this case, HPS Concrete Pvt. Ltd. decided to utilize the scheme to settle its tax arrears for the assessment year 2017-18. The company filed Form 5 under the scheme, indicating its willingness to pay the disputed tax and settle the matter. This decision led to the withdrawal of the appeal that was pending before the ITAT.

Proceedings Before the ITAT

The appeal was heard by the Delhi Bench ‘B’ of the ITAT on July 6, 2022. The Bench was presided over by Accountant Member Shri Shamim Yahya and Judicial Member Shri Narender Kumar Choudhry. The appellant, HPS Concrete Pvt. Ltd., was represented by Advocate Shri Deepesh Garg, while the Revenue was represented by Senior Departmental Representative Ms. Sangeeta Yadav.

During the proceedings, the appellant’s counsel submitted an application for the withdrawal of the appeal, citing the settlement of the dispute under the Vivad Se Vishwas Scheme, 2020. The submission was supported by the issuance of Form 5 by the Income Tax Department, confirming the full and final settlement of the tax arrears.

Tribunal’s Decision

The ITAT, after considering the submissions made by the appellant, accepted the withdrawal request and dismissed the appeal. The tribunal noted that the Revenue had no objection to the withdrawal, and therefore, the appeal was dismissed with a caveat. The tribunal allowed the appellant the liberty to reinstitute the appeal in the event that the dispute was not resolved as per the scheme’s provisions.

The decision to dismiss the appeal was pronounced in the open court on July 6, 2022, immediately following the conclusion of the hearing.

Conclusion

The case of HPS Concrete Pvt. Ltd. vs DCIT Central Circle, Ghaziabad demonstrates the practical utility of the Vivad Se Vishwas Scheme, 2020, in resolving tax disputes amicably. By opting for the scheme, HPS Concrete Pvt. Ltd. was able to bring closure to its tax dispute for the assessment year 2017-18, avoiding the complexities and uncertainties associated with continued litigation.

The ITAT’s prompt action in dismissing the appeal and providing a safeguard for potential reinstitution highlights the tribunal’s role in facilitating the resolution of tax disputes in an efficient and fair manner. This case serves as a precedent for other taxpayers considering the benefits of the Vivad Se Vishwas Scheme or similar settlement mechanisms in the future.

The tribunal’s decision to include a caveat for possible reinstitution ensures that taxpayers’ rights are preserved, even when they opt for settlement under schemes like Vivad Se Vishwas. This provides a balanced approach, ensuring that taxpayers are not left without recourse if the settlement process does not reach its intended conclusion.

Final Tribunal Order

The final order, pronounced on July 6, 2022, by Accountant Member Shri Shamim Yahya and Judicial Member Shri Narender Kumar Choudhry, officially dismissed the appeal filed by HPS Concrete Pvt. Ltd. The tribunal’s order reflected the conclusion of the case, with the provision for the appellant to reinstitute the appeal if necessary.

Order Pronounced in the Open Court on 6th July, 2022.

Judicial Member: Narender Kumar Choudhry

Accountant Member: Shamim Yahya

HPS Concrete Pvt. Ltd. vs DCIT Central Circle, Ghaziabad: Withdrawal of Appeal Under Vivad Se Vishwas Scheme for AY 2017-18