Case Law Details
Naveen Kumar Aggarwal Vs Central Board of Direct Taxes & Anr (Delhi High Court)
In the case of Naveen Kumar Aggarwal vs. Central Board of Direct Taxes & Anr, the petitioner challenged the constitutional validity of Chapter IV of The Finance (No. 2) Act, 2024, specifically the Direct Tax Vivad Se Vishwas Scheme, 2024. The petitioner contested Section 89(1)(a) of the Act, arguing that it unfairly limits the term “appellant” to individuals who have already filed an appeal, writ petition, or special leave petition, excluding those who are eligible to file but have not yet done so. This, the petitioner claims, is discriminatory compared to the 2020 scheme, which included cases where the time for filing an appeal had not expired.
The Delhi High Court acknowledged the petitioner’s concerns and found merit in examining the issue. The court highlighted that a similar situation in the 2020 scheme was resolved through a clarifying circular issued by the Central Board of Direct Taxes (CBDT). To address the anomaly, the court directed the CBDT to review the petition as a representation and consider issuing a similar circular for the 2024 scheme. With the scheme’s cut-off date of December 31, 2024, the court requested that the matter be resolved within two weeks.
While disposing of the petition, the court clarified that the petitioner could approach the judiciary again if the issue remains unresolved. This case underscores the necessity of addressing potential inequities in tax settlement schemes to ensure fairness and inclusivity for all taxpayers.
FULL TEXT OF THE JUDGMENT/ORDER OF DELHI HIGH COURT
1. The petitioner has filed the present petition challenging the constitutional validity of Chapter IV of The Finance (No.2) Act, 2024 – Direct Tax Vivad Se Vishwas Scheme, 2024. The petitioner is particularly aggrieved by Section 89(1)(a) of the said Act inasmuch as it has confined the meaning of the appellant to a person in whose case an appeal or a writ petition or a special leave petition has been filed by him or the Income Tax Authorities.
2. According to the petitioner, the same does not take into account a person who intends to file an appeal and the time for filing the appeal has not expired. It is pointed out that this is in contrast with Section 2(1)(a) of the Direct Tax Vivad Se Vishwas Act, 2020. It is contended that the definition of the term ‘Appellant’ thus discriminates between a person who has filed an appeal before the specified date and a person who is in process of filing an appeal. Prima facie, we find it difficult to accept that differentiating between assessee on the basis whether they have filed an appeal before the specified date or thereafter could be dispositive of the assessee’s right to claim benefit under the Direct Tax Vivad Se Vishwas Scheme, 2024. We also note that in respect of the Finance Act, 2020 the Central Board of Direct Taxes (hereafter CBDT) had issued a comprehensive circular to clarify that a case where an appeal is not filed but the time for filing the same has not expired would also be included in the scheme.
3. In the aforesaid circumstances, we consider it apposite to direct the CBDT to consider the anomaly pointed out by the petitioner in the present petition and to examine whether it would be apposite to issue a circular in the said regard. Since 31.12.2024 has been fixed as a cut off date for availing the maximum benefit, we request the CBDT to consider the present petition as a representation as expeditiously as possible, and preferably within a period of two weeks from date.
4. The writ petition is disposed of in the aforesaid terms. Pending applications also stand disposed of.
5. We clarify that if the grievance of the petitioner is not addressed, he is at liberty to apply afresh.
Author Bio
After the High Court Judgement whether any circular issued by the CBDT to accomodate such cases ? Whether Form 1 accomodates these cases now? Can you please throgh some ligh on the same. Thank You