Gujarat High Court
Neelaben Ghanshyambhai Parmar vs The Principal Commissioner Of Income ... on 8 September, 2025
Author: Bhargav D. Karia
Bench: Bhargav D. Karia
NEUTRAL CITATION
C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/SPECIAL CIVIL APPLICATION NO. 10560 of 2025
With
R/SPECIAL CIVIL APPLICATION NO. 10784 of 2025
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
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Approved for Reporting Yes No
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NEELABEN GHANSHYAMBHAI PARMAR
Versus
THE PRINCIPAL COMMISSIONER OF INCOME TAX
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Appearance:
MR SUDHIR M MEHTA(2058) for the Petitioner(s) No. 1
MS SHAILEE S MEHTA(5873) for the Petitioner(s) No. 1
KARAN G SANGHANI(7945) for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE BHARGAV D. KARIA
and
HONOURABLE MR. JUSTICE PRANAV TRIVEDI
Date : 08/09/2025
ORAL JUDGMENT
(PER : HONOURABLE MR. JUSTICE BHARGAV D. KARIA)
1. Heard learned advocate Mr. Sudhir M. Mehta for the petitioner and learned Page 1 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined Senior Standing Counsel Mr. Karan Sanghani for the respondent.
2. Having regard to the controversy involved, with the consent of the learned advocates for the respective parties, the matter is taken up for hearing.
3. The issue involved in both the petitions is identical and therefore, they have been heard together and would be disposed of by this common judgment.
4. Rule returnable forthwith. Learned Senior Standing Counsel Mr. Karan Sanghani waives service of notice of rule on behalf of the respondent in the respective petitions.
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5. For the sake of convenience, facts are recorded from Special Civil Application No.10560 of 2025.
6. By this petition under Article 227 of the Constitution of India, the petitioner has prayed to quash and set aside order dated 11.04.2025 rejecting the declaration made by the petitioner under Direct Tax Vivad Se Vishwas Scheme, 2024 (For short "the DTVSV Scheme, 2024").
7. The petitioner filed the return of income for the Assessment Year 2012-2013 which was the subject to the assessment order passed under section 144 read with section 147 of the Income Tax Act, 1961 (For short "the Act") dated 05.12.2019 making addition of Rs.30,80,770/-. Page 3 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025
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8. Being aggrieved, the petitioner preferred an appeal before the appellate authority along with application to condone the delay on 29.05.2023. Therefore, the appeal filed by the petitioner was pending as on 22.07.2024 which is the specified date as per provisions of section 89(1)(n) of the DTVSV Scheme, 2024.
9. By Finance (No.2) Act, 2024, the DTVSV Scheme, 2024 came into force as per Chapter IV from section 88 to section 99 of the said Act. As per the said Scheme for dispute resolution in respect of pending income tax litigation and to reduce the pending tax litigation in order to generate timely revenue for Government Page 4 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined and benefit the tax payers by providing them peace of mind, certainty and savings on account of time and resources that would otherwise be spent on the long drawn and vexatious litigation process, DTVSV Scheme, 2024 was notified with effect from 1.10.2024. The Rules under the DTVSV Scheme, 2024 have been notified on 20.09.2024.
10. Under section 97 of the DTVSV Scheme, 2024, the Central Board of Direct Taxes issued Guidance Note No.1/2024 in form of answers to the Frequently Asked Questions (FAQs) vide Circular No. 12 of 2024 dated 15.10.2024. Thereafter, Guidance Note No. 2/2024 was issued on 16.12.2024 and following FAQ NO.36 was inserted in place of FAQ NO.8 of Guidance Note No.1/2024 Page 5 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined which reads as under:
S. Issue Comments
No.
Eligibility of cases
36 Suppose a taxpayer is Yes, such
eligible to apply for cases are
DTVSV Scheme, 2024 as eligible for
his appeal is pending settlement as on 22.7.2024. But under the subsequently, before Scheme as the taxpayer could appeal was file declaration under pending as on the DTVSV Scheme, 22.7.2024. 2024, his appeal has Disputed tax been disposed off on will be merits or dismissed as calculated in withdrawn for the the same purposes of the manner as if Scheme. Can such a the appeal taxpayer still file pending on declaration under the 22.7.2024 is Scheme? yet to be disposed off.
11. The appeal preferred by the petitioner was disposed of by CIT(Appeals) in the month of October/December 2024 as non maintainable. The Central Government thereafter issued Notification No. S.O. 1650(E) [F.No.32/2025/F.No.370142/9/2025- Page 6 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined TPL] dated 8.04.2025 in exercise of the powers conferred by clause(l) of sub- section (1) of section 89 of the Finance (No.2) Act, 2024 and notified the last date as the 30th day of April, 2025 under the DTVSV Scheme, 2024 on or before which, a declaration in respect of tax arrear was to be filed by the declarant to the Designated Authority in accordance with the provisions of section 90 of the said Act.
12. Accordingly, the petitioner filed a declaration for the Assessment Year 2012- 2013 on 11.03.2025 in Form-1 under sub- section (1) of section 90 read with sub- section (4) of section 91 of the Finance (No.2) Act, 2024 under the DTVSV Scheme, 2024 wherein the petitioner stated that Page 7 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined appeal before the CIT(Appeals) was pending as on 22.07.2024. However the respondent Designated Authority rejected the declaration of the petitioner on the ground that the appeal filed by the petitioner was held to be non maintainable and therefore, the same was not a valid appeal and accordingly, the petitioner was held to be ineligible for the benefits of the DTVSV Scheme, 2024.
13. Learned Advocate Mr. Sudhir Mehta for the petitioner submitted that the eligibility criteria for filing declaration in Form-1 under the DTVSV Scheme, 2024 is that the appeal filed by the petitioner before the CIT(Appeals) should be pending on the specified date i.e. 22.07.2024.
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14. It was submitted that as per FAQ No.36 which is inserted by Guidance Note No.2/2024 dated 16.12.2024, CBDT has clarified that the assessee would be eligible for settlement under the Scheme as the appeal was pending as on 22.07.2024 and the disputed tax will be calculated in the same manner as if the appeal pending on 22.07.2024 is yet to be disposed of though appeal would have been disposed of on merits or dismissed as withdrawn.
15. It was therefore, submitted that even if the appeal is held to be non maintainable by CIT(Appeals) subsequently after 22.07.2024, the petitioner would be eligible for benefits under the DTVSV Scheme, 2024.
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16. In support of his submissions, reliance was placed on the following decisions:
i) Tushar Agro Chemicals v. Principal Commissioner of Income-tax-1 reported in (2022) 441 ITR 179 (Gujarat).
ii) Atul Roshanlal Gupta v. Principal Commissioner of Income-tax reported in (2024) 167 taxmann.com 634 (Gujarat).
17. Per contra, learned Senior Standing Counsel Mr. Karan Sanghani for the respondent submitted that the reliance placed by the petitioner on FAQ No.36 as well as the aforesaid decisions would not be applicable in facts of the case as the Page 10 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined appeal preferred by the petitioner was held to be non maintainable and therefore, the appeal was an invalid appeal as held by CIT(Appeals) and such order has achieved finality.
18. It was therefore, submitted that an invalid appeal cannot be said to be pending as on the specified dated i.e 22.07.2024 and therefore, the Designated Authority has rightly rejected the declaration of the petitioner on the ground of invalid appeal.
19. Having considered the rival submissions made by learned advocates for the respective parties, it would be germane to refer to the relevant provisions of the DTVSV Scheme, 2024 as Page 11 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined contained in sections 88 to 99 in Finance (No.2) Act, 2024 as under:
"89.(1) in the Scheme, unless the context otherwise requires-
(l) "last date" means such date as may be notified by the Central Government in the Official Gazette."
(n) "specified date" means the 22nd day of July, 2024"
20. As per section 90 of the the DTVSV Scheme, 2024, a declarant assessee has to pay the tax as on 1st day of January, 2025. The date of computation of tax payable was further extended by Circular No.20/2024 dated 30.12.2024 from 31st December, 2024 to 31st January, 2025 and in view of Notification dated 8.04.2025, the last date of the Scheme was notified as the 30th day of April, 2025. Accordingly, the petitioner has filed a declaration under section 90(1) read with Page 12 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined section 91(4) of the DTVSV Scheme, 2024 in Form-1 on the ground that the appeal preferred by the petitioner before the CIT(Appeals) though disposed of in October/December, 2024 was pending as on the specified date i.e. 22.07.2024 as per the provisions of section 89(1)(n) of Finance (No.2) Act, 2024.
21. In case of Tushar Agro Chemicals(supra), this Court has held as under:
"10. At this juncture, it would be relevant to refer to the decision of Supreme Court in case of Commissioner of Income Tax v. Shatrusailya Digvijaysingh Jadeja, relied upon by the learned Senior Advocate Mr. Hemani, in which the S.C. had an occasion to deal with the issue, as to whether, the department could have rejected the Declaration filed under the similar scheme called Kar Vivad Samadhan Scheme, introduced vide the Finance [No.2] Act 1998, on Page 13 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined the ground that the Revision / Appeal filed by the concerned Petitioner was time barred or was not valid. In the said case, the Supreme Court considered the object of the said Scheme as also the other earlier decisions, and observed as under:
"13. In our view, the Scheme was in substance a recovery scheme though it was nomenclatured as a "litigation settlement scheme" and was not similar to the earlier Voluntary Disclosure Scheme. As stated above, the said Scheme was a complete Code by itself. Its object was to put an end to all pending matters in the form of appeals, reference, revisions and writ petitions under the IT Act/WT Act. Keeping in mind the above object, we have to examine section 95(i)(c) of the Scheme, which was different from appeals under section 246, revisions under section 264, appeals under section 260A etc. of the IT Act and similar provisions under the W.T. Act. Under the I.T. Act, there is a difference between appeals, revisions and references. However, those differences were obliterated and appeals, revisions and Page 14 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined references were put on par under section 95(i)(c) of the Scheme. The object behind section 95(i)(c) in putting on par appeals, references and revisions was to put an end to litigation in various forms and at various stages under the IT Act/Wealth Tax Act and, therefore, the rulings on the scope of appeals and revisions under the IT Act or on Voluntary Disclosure Scheme, will not apply to this case.
15. In the case of Dr. Mrs. Renuka Delta (supra), this Court has held on interpretation of section 95(i)(c) that if the appeal or revision is pending on the date of the filing of the declaration under section 88 of the Scheme, it is not for the DA to hold that the appeal/revision was "sham", "ineffective" or "infructuous"
as it has.
16. In the case of Raja Kulkarni v. The State of Bombay reported in AIR 1954 SC 73, this Court laid down that when a section contemplates pendency of an appeal, what is required for its application is that an appeal should be Page 15 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined pending and in such a case there is no need to introduce the qualification that it should be valid or competent. Whether an appeal is valid or competent is a question entirely for the appellate court before whom the appeal is filed to decide and this determination is possible only after the appeal is heard but there is nothing to prevent a party from filing an appeal which may ultimately be found to be incompetent, e.g., when it is held to be barred by limitation. From the mere fact that such an appeal is held to be unmaintainable on any ground whatsoever, it does not follow that there was no appeal pending before the Court.
17. To the same effect is the law laid down by the judgment of this Court in the case of Tirupati Balaji Developers (P) Ltd. v. State of Bihar & Others reported in (2004) 5 SCC 1, in which it has been held that an appeal does not cease to be an appeal though irregular and incompetent."
11. In view of the aforestated legal position, there remains no shadow of doubt that appeal could Page 16 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined be said to be pending, even if the delay occurred in filing the same was not condoned and even if it was allegedly irregular or incompetent. In the instant case therefore also, the Respondent could not have rejected the Declaration Form of the Petitioner filed under the said Act merely on the ground that the Appeal was not valid or competent, as the delay occurred in filing the Appeal was not condoned by the Appellate Authority. In the opinion of the Court, the Respondent had to only take into consideration, as to whether, the Petitioner had filed an Appeal, and the same was pending on the 'specified date' i.e. 31.1.2020. It was not for the Respondent to decide, as to whether, such Appeal was irregular or incompetent or invalid in the eye of law."
22. In case of Atul Roshanlal Gupta(supra), it was held by this Court as under:
"7. In view of the above provisions of the VSV Act, it emerges that the petitioner has to be an appellant so as to be eligible on the specified date i.e. 31st January, 2020 to file Page 17 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined declaration under Sections 3 and 4 of the VSV Act. Admittedly, the appeal filed by the petitioner in the year 2015 was not pending as on 31st January, 2020. However, in view of order dated 03rd September, 2020 passed by the Tribunal recalling its order dated 26th March, 2019 whereby appeal filed by the petitioner was dismissed, the appeal was restored to its file i.e. Appeal filed in the year 2015. Therefore, the appeal of the petitioner has to be considered as pending as on 31st January, 2020 which is the specified date as per the VSV Act.
7.1 It is also pertinent to note that when the petitioner has filed declaration under the VSV Act to claim the benefit of the Scheme, the Tribunal had already recalled the order dated 26th March, 2019 and therefore, the appeal preferred by the petitioner before the Tribunal was pending as on 31st January, 2020.
7.2 In view of the above facts, it cannot be said that no appeal was pending as on 31st January, 2020 when the petitioner filed the application/declaration under the provisions of the Scheme in view of order dated 03rd September, 2020 passed by the Tribunal in Miscellaneous Application Page 18 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined No.75/Ahd/2020 preferred by the petitioner to recall order dated 26th March, 2019 whereby appeal of the petitioner was dismissed for non-prosecution."
8. Considering the above facts, the impugned action of the respondent authority of rejecting the declaration filed by the petitioner is not tenable and accordingly, the same is quashed and set aside. The respondent authority is directed to consider and process the declaration filed by the petitioner under the provisions of the VSV Act within a period of 12 weeks from the date of receipt of copy of this order. The petition is accordingly disposed of. Notice is discharged. No order as to costs."
23. Applying the above decisions to the facts of the case and in view of FAQ No.36, it is not in dispute that appeal filed by the petitioner was pending on the specified date i.e. 22.07.2024 and therefore, we are of the opinion that the Designated Authority was not justified in Page 19 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined rejecting the declaration filed by the petitioner in Form-1 on the ground that appeal filed by the petitioner was an invalid appeal as the appeal was very much pending as on 22.07.2024 even if the same was held to be invalid subsequently. The appeal cannot be said to be not filed or pending only on the ground that it was held to be non maintainable by CIT(Appeals) subsequently. Therefore, the respondent Designated Authority could not have rejected the declaration in Form-1 filed by the petitioner under the said Act merely on the ground that the appeal was not valid or competent.
24. In view of the foregoing reasons, the impugned communication in both the petitions dated 11.04.2025 displayed on Page 20 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025 NEUTRAL CITATION C/SCA/10560/2025 JUDGMENT DATED: 08/09/2025 undefined the Portal of the Department, rejecting declaration in Form-1 filed by the petitioner under the DTVSV Scheme, 2024 is hereby quashed and set aside. The respondent Designated Authority is directed to process the declaration in Form-1 filed by the petitioner under the DTVSV Scheme, 2024 in accordance with the said scheme.
25. Petitions are accordingly allowed and disposed of. Rule is made absolute to the above extent in each petition. No order as to costs.
(BHARGAV D. KARIA, J) (PRANAV TRIVEDI,J) RAGHUNATH R NAIR Page 21 of 21 Uploaded by RAGHUNATH R NAIR(HC00196) on Mon Sep 15 2025 Downloaded on : Mon Sep 15 21:47:37 IST 2025