Withdrawal of Appeal Under Vivad Se Vishwas Scheme: Prabhat Fertilizer & Chemical Works vs ACIT – ITA No. 6259/DEL/2019 (Assessment Year 2012-13)

Case Overview: Prabhat Fertilizer & Chemical Works vs ACIT – ITA No. 6259/DEL/2019

Case Number: ITA 6259/DEL/2019

Appellant: Prabhat Fertilizer & Chemical Works, Karnal

Respondent: ACIT, Circle, Karnal

Assessment Year: 2012-13

Order Type: Final Tribunal Order

Date of Order: 25th February 2021

Case Filed On: 24th July 2019

Bench: SHRI R.K. PANDA, ACCOUNTANT MEMBER, and SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER

Introduction

The case of Prabhat Fertilizer & Chemical Works vs ACIT revolves around an appeal filed by the appellant, Prabhat Fertilizer & Chemical Works, against the order of the Commissioner of Income Tax (Appeals) [CIT(A)], Karnal, for the assessment year 2012-13. The appeal was initially filed before the Income Tax Appellate Tribunal (ITAT), Delhi Bench, challenging the decision of the CIT(A). However, the appellant later opted to withdraw the appeal under the Vivad Se Vishwas Scheme, 2020, a government initiative aimed at resolving tax disputes.

Background of the Case

Prabhat Fertilizer & Chemical Works, based in Karnal, Haryana, filed an appeal with the ITAT against the CIT(A)’s order dated 3rd May 2019. The appeal was related to certain tax arrears and disputes for the assessment year 2012-13. The appellant contested the findings of the CIT(A) and sought relief from the ITAT.

During the pendency of the appeal, the Government of India introduced the Vivad Se Vishwas Scheme, 2020, under the Direct Tax Vivad Se Vishwas Act, 2020. The scheme was designed to provide a one-time opportunity to taxpayers to settle their tax disputes by paying a specified percentage of the disputed tax amount, thereby resolving the matter without further litigation.

Vivad Se Vishwas Scheme and Withdrawal of Appeal

On 22nd February 2021, Prabhat Fertilizer & Chemical Works submitted a request to the ITAT to withdraw the appeal, citing their decision to opt for the Vivad Se Vishwas Scheme. The appellant provided a certificate under Section 5(1) of the Direct Tax Vivad Se Vishwas Act, 2020, as proof of their participation in the scheme and the settlement of the tax arrears.

The appellant’s decision to withdraw the appeal was based on the benefits offered by the Vivad Se Vishwas Scheme, which allowed for a faster resolution of the dispute with reduced financial implications. By opting for the scheme, the appellant aimed to resolve the matter amicably and avoid prolonged litigation.

Proceedings at the ITAT

The case was heard by the ITAT, Delhi Bench ‘C’, on 25th February 2021. The bench was composed of SHRI R.K. PANDA, ACCOUNTANT MEMBER, and SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER. During the virtual hearing, the appellant’s request for withdrawal of the appeal was taken into consideration.

The Senior Departmental Representative (DR), Sh. M. Baranwal, represented the Income Tax Department and had no objections to the withdrawal request made by the appellant.

Tribunal’s Decision

After reviewing the appellant’s request and the supporting documentation, the ITAT accepted the withdrawal of the appeal. The Tribunal acknowledged that the appellant had opted to settle the tax dispute under the Vivad Se Vishwas Scheme, 2020, and that a certificate under Section 5(1) of the Act had been duly submitted.

The ITAT observed that the appellant’s decision to withdraw the appeal was in line with the objectives of the Vivad Se Vishwas Scheme, which encourages taxpayers to resolve disputes through a simplified and expedited process. The Tribunal noted that the scheme provided a favorable outcome for both the taxpayer and the revenue authorities by reducing the backlog of cases and ensuring quicker settlements.

Conclusion and Order

In light of the above, the ITAT concluded that the appeal filed by Prabhat Fertilizer & Chemical Works for the assessment year 2012-13 was to be dismissed as withdrawn. The Tribunal’s decision was consistent with the provisions of the Vivad Se Vishwas Scheme, which allows taxpayers to withdraw appeals pending before appellate forums upon settlement of their disputes.

The ITAT’s order emphasized the importance of the Vivad Se Vishwas Scheme in providing an efficient mechanism for resolving tax disputes. The scheme has been widely appreciated for its role in reducing litigation and fostering a cooperative approach between taxpayers and the Income Tax Department.

Final Judgment

The final judgment in the case of Prabhat Fertilizer & Chemical Works vs ACIT (ITA No. 6259/DEL/2019) reflects the successful implementation of the Vivad Se Vishwas Scheme, 2020. The decision to withdraw the appeal under the scheme highlights the benefits of opting for alternative dispute resolution mechanisms provided by the government.

The Tribunal’s acceptance of the withdrawal request and the dismissal of the appeal underscore the effectiveness of the Vivad Se Vishwas Scheme in achieving its goal of reducing tax litigation and promoting a harmonious relationship between taxpayers and the tax authorities.

Bench: SHRI R.K. PANDA, ACCOUNTANT MEMBER, and SHRI K. NARASIMHA CHARY, JUDICIAL MEMBER

Order Pronounced On: 25th February 2021

Result: The appeal is dismissed as withdrawn under the Vivad Se Vishwas Scheme, 2020.

Withdrawal of Appeal Under Vivad Se Vishwas Scheme: Prabhat Fertilizer & Chemical Works vs ACIT – ITA No. 6259/DEL/2019 (Assessment Year 2012-13)