Rudraksh Buildwell Pvt. Ltd. vs. ITO: Appeal Withdrawal under Vivad Se Vishwas Scheme for AY 2011-12

Case Overview: Rudraksh Buildwell Pvt. Ltd. vs. ITO, Assessment Year 2011-12

The case of Rudraksh Buildwell Pvt. Ltd. vs. ITO Ward-21(4), New Delhi, related to the assessment year 2011-12, came up for hearing before the Income Tax Appellate Tribunal (ITAT) Delhi Bench. The appeal was filed by Rudraksh Buildwell Private Limited against the order passed by the learned Commissioner of Income Tax (Appeals) [CIT(A)]-07, New Delhi, dated May 30, 2019. However, the appellant decided to withdraw the appeal under the provisions of the Vivad Se Vishwas Scheme, 2020.

Background of the Case

Rudraksh Buildwell Pvt. Ltd., a company based in New Delhi with its registered office at X-10, Okhla Industrial Area, Phase-2, had filed an appeal against the income tax assessment order for the year 2011-12. The appeal was directed against the decision of the CIT(A), who had upheld the order of the Income Tax Officer (ITO), Ward-21(4), New Delhi.

The specific grounds of appeal, although not detailed in the order, pertained to tax arrears and the disputes arising from the assessment order. As the proceedings progressed, the appellant chose to opt for the Vivad Se Vishwas Scheme, 2020, introduced by the Government of India to resolve pending tax disputes.

Vivad Se Vishwas Scheme, 2020

The Vivad Se Vishwas Scheme, 2020, was launched as part of the Union Budget 2020 to provide a mechanism for the settlement of pending direct tax disputes. Under the scheme, taxpayers were given the opportunity to settle their disputes by paying a specified percentage of the disputed tax amount, with a waiver of interest and penalties. The scheme was aimed at reducing litigation and providing certainty to taxpayers.

In the present case, Rudraksh Buildwell Pvt. Ltd. decided to take advantage of this scheme to resolve the ongoing tax dispute for the assessment year 2011-12. By opting for this scheme, the company sought to bring an end to the litigation and settle its tax arrears amicably.

Request for Withdrawal

On March 31, 2021, the learned counsel for the appellant submitted a letter to the ITAT, requesting the withdrawal of the appeal. The letter, which was received by email, stated that the appellant had opted to settle the dispute under the Vivad Se Vishwas Scheme, 2020. A certificate under Section 5(1) of The Direct Tax Vivad Se Vishwas Act, 2020, confirming the settlement, was also submitted as part of the withdrawal request.

During the virtual hearing on April 15, 2021, the tribunal, presided over by Vice President Shri G.S. Pannu and Judicial Member Shri Kul Bharat, acknowledged the withdrawal request. The Senior Departmental Representative (DR), Shri R.K. Gupta, representing the respondent, the Income Tax Department, had no objection to the withdrawal of the appeal.

Tribunal’s Decision

After considering the request for withdrawal and noting the appellant’s decision to settle the dispute under the Vivad Se Vishwas Scheme, the ITAT Delhi Bench accepted the withdrawal. The tribunal observed that since the appellant had chosen to resolve the matter through the scheme, there was no need to proceed with the appeal.

The tribunal, therefore, dismissed the appeal as withdrawn. The decision was announced on the conclusion of the virtual hearing on April 15, 2021.

Conclusion

The case of Rudraksh Buildwell Pvt. Ltd. vs. ITO highlights the effectiveness of the Vivad Se Vishwas Scheme, 2020, in resolving pending tax disputes. By opting for the scheme, the appellant was able to settle the tax arrears for the assessment year 2011-12, thereby avoiding prolonged litigation and potential penalties. The scheme has provided a practical solution for taxpayers seeking to resolve their disputes with the tax authorities, and this case serves as an example of its successful implementation.

This decision also underscores the importance of alternative dispute resolution mechanisms in the tax domain, which can lead to quicker and more amicable settlements, benefiting both the taxpayer and the revenue authorities.

Rudraksh Buildwell Pvt. Ltd. vs. ITO: Appeal Withdrawal under Vivad Se Vishwas Scheme for AY 2011-12