Madras High Court
M/S.Cortex Enterprises vs The Income Tax Officer on 11 January, 2021
TCA.No.10 of 2021
IN THE HIGH COURT OF JUDICATURE AT MADRAS
DATED : 11.1.2021
CORAM
THE HONOURABLE MR.JUSTICE T.S.SIVAGNANAM
and
THE HONOURABLE MS.JUSTICE R.N.MANJULA
Tax Case Appeal No.10 of 2021 & CMP.No.195 of 2021
M/s.Cortex Enterprises,
Chennai-4 ...Appellant
Vs
The Income Tax Officer, Non
Corporate Ward 1(5), Chennai-34 ...Respondent
APPEAL under Section 260A of the Income Tax Act, 1961 against
the order dated 30.4.2019 passed by the Income Tax Appellate
Tribunal, 'B' Bench, Chennai made in I.T.A.No.3380/Chny/2018 for the
assessment year 2014-15.
For Appellant: Mr.P.Prithvi Chopda
For Respondent : Mr.T.Ravikumar, SSC
Judgment was delivered by T.S.SIVAGNANAM,J
This appeal has been filed by the assessee under Section 260A of
the Income Tax Act, 1961 ('the Act' for brevity) challenging the order
https://www.mhc.tn.gov.in/judis/
TCA.No.10 of 2021
dated 30.4.2019 made in I.T.A.No.3380/Chny/2018 on the file of the
Income Tax Appellate Tribunal, Chennai, 'B' Bench ('the Tribunal' for
brevity) for the assessment year 2014-15.
2. The assessee has filed this appeal by raising the following
substantial question of law:
“Whether, in the facts and circumstances
of the case, the Appellate Tribunal is correct in
law to uphold the disallowance under Section
40A(3) for the payment made in the course of
business due to unavoidable circumstance
falling under exceptional circumstance
provided under Rule 6DD of the Income Tax
Rules?”
3. We have heard Mr.P.Prithvi Chopda, learned counsel appearing
for the appellant – assessee and Mr.T.Ravikumar, learned Senior
Standing Counsel accepting notice for the respondent – Revenue.
4. The learned counsel for the appellant/assessee, on
instructions, submitted that the appellant/assessee intends to avail the
benefit of Vivad Se Vishwas Scheme ('VVS Scheme' for brevity) and in
this regard, the assessee is taking steps to file the application/
declaration in Form No.I.
5. It may not be necessary for this Court to decide the
substantial questions of law raised for consideration on account of
https://www.mhc.tn.gov.in/judis/
TCA.No.10 of 2021
certain subsequent developments. The Government of India enacted
the Direct Tax Vivad Se Vishwas Act, 2020 (Act 3 of 2020) to provide
for resolution of disputed tax and for matters connected therewith or
incidental thereto. The Act of the Parliament received the assent of the
President on 17th March 2020 and published in the Gazette of India on
17th March 2020.
6. In terms of the said Act, the assessee has been given an
option to put an end to the tax disputes, which may be pending at
different levels either before the First Appellate Authority or before the
Tribunal or before the High Court or before the Hon'ble Supreme Court
of India. Under Section 2(j) “disputed tax” has been defined. In terms
of Section 3, where a declarant means a person, who files a
declaration under Section 4 on or before the last date files a
declaration to the designated authority in accordance with the
provisions of Section 4 in respect of tax arrears, then, notwithstanding
anything contained in the Income Tax Act or any other law for the time
being in force, the amount payable by the declarant shall be
determined in terms of Section 3(a-c) thereunder.
7. The First Proviso to Section 3 states that in case, where an
Appeal or Writ Petition or Special Leave Petition is filed by the Income
Tax authority on any issue before the Appellate Forum, the amount
https://www.mhc.tn.gov.in/judis/
TCA.No.10 of 2021
payable shall be one-half of the amount in the table stipulated in
Section 3 calculated on such issue, in such a manner as may be
prescribed. The Second Proviso deals with the cases, where the matter
is before the Commissioner (Appeals) or before the Dispute Resolution
Panel. The Third Proviso deals with cases, where the issue is pending
before the Income Tax Appellate Tribunal. The filing of the declaration
is as per Section 4 of the Act and the particulars to be furnished are
also mentioned in the Sub Sections of Section 4. Section 5 of the Act
deals with the time and manner of the payment and Section 6 deals
with Immunity from initiation of proceedings in respect of offence and
imposition of penalty in certain cases. Section 9 of the Act deals with
cases, where the Act 3 of 2020 will not be applicable.
8. As observed, the assessee is given liberty to restore this
appeal in the event the ultimate decision to be taken on the
declaration to be filed by the assessee under Section 4 of the said Act
is not in favour of the assessee. If such a prayer is made, the Registry
shall entertain the prayer without insisting upon any application to be
filed for condonation of delay in restoration of the appeal and on such
request made by the assessee by filing a miscellaneous petition for
restoration, the Registry shall place such petition before the Division
Bench for orders.
https://www.mhc.tn.gov.in/judis/
TCA.No.10 of 2021
9. In the light of the above, we direct the appellant/assessee to
file the Form No.1 and the Competent Authority shall process the
application/declaration in accordance with the Act and pass appropriate
orders as expeditiously as possible preferably within a period of six (6)
weeks from the date on which the declaration is filed in the proper
form.
10. The tax case appeal stands disposed of with the
aforementioned liberty and the substantial question of law raised is left
open. No costs. Consequently, the connected CMP is closed.
11.1.2021
To
1.The Income Tax Appellate Tribunal, 'B' Bench, Chennai.
2.The Income Tax Officer, Non Corporate Ward 1(5), Chennai-34.
RS
https://www.mhc.tn.gov.in/judis/
TCA.No.10 of 2021
T.S.SIVAGNANAM,J
AND
R.N.MANJULA,J
RS
TCA.No.10 of 2021&
CMP.No.195 of 2021
11.1.2021
https://www.mhc.tn.gov.in/judis/
