ITAT Allows Income Tax Appeal Withdrawals as Taxpayer Opts for Vivad Se Vishwas

Oxford University Press Vs DCIT (ITAT Mumbai)

Income Tax Appellate Tribunal (ITAT) Mumbai has allowed Oxford University Press to withdraw its appeal against the final assessment order dated October 31, 2023, for the Assessment Year 2021-22. The appellant informed the tribunal that it intends to opt for the Vivad Se Vishwas Scheme (VSVS) 2024, a tax dispute resolution scheme introduced by the government. Instead of adjourning the hearing, the tribunal dismissed the appeal as withdrawn, allowing the assessee to revive it if the scheme application is unsuccessful.

The counsel for the assessee submitted a request either to keep the appeal in abeyance or grant permission for withdrawal with the liberty to restore it if the application under VSVS 2024 is not accepted. The tribunal referred to CBDT Circular No. 19 of 2024 and Guidance Note 2/2024, FAQ No. 8, which clarifies that appeals pending as of July 22, 2024, remain eligible for settlement under the scheme even if subsequently withdrawn.

The department’s representative (DR) raised no objections to the withdrawal, acknowledging that the appeal’s dismissal would not impact the assessee’s eligibility under the VSVS scheme. The tribunal held that since the appellant is availing of the scheme, the appeal should be dismissed as withdrawn while ensuring that the assessee retains the right to reinstate it if the settlement does not materialize.

This ruling aligns with previous ITAT decisions permitting assessees to withdraw pending tax appeals to benefit from settlement schemes. By dismissing the appeal with the option to revive, the ITAT Mumbai upholds procedural flexibility while allowing the assessee to explore a dispute resolution mechanism. The order was pronounced in January 2025.

FULL TEXT OF THE ORDER OF ITAT MUMBAI

The aforesaid appeal has been filed by the assessee against final assessment order dated 31/10/2023 passed by AO in pursuance of direction given by DRP for the A.Y.2021-22.

2. It has been stated by the ld. Counsel that assessee is going for ‘Vivad Se Vishwas Scheme-2024’ and is in the process of filing of the application. The ld. Counsel for the assessee stated that either to keep the appeal in abeyance or permission be granted to withdraw the appeal with the liberty that in case the application for ‘Vivad Se Vishwas Scheme-2024’ is not materialized or not accepted by the department, liberty may be given to restore / revise the appeal. Contents of the letter is reproduced hereunder:-

“The captioned appeal is scheduled for hearing before the ‘T’ Bench of the Hon’ble Tribunal on 02 January 2025.

In this regard, the Appellant humbly submits before Your Honours that it is in the process of filing Form 1 (Form for filing declaration and undertaking under the Direct Tax Vivad Se Vishwas Scheme, 2024) for opting the DTVSV 2024. The Appellant humbly submits that the Central Board of Direct Tax (CBDT) via Circular no 20/2024 dated 30 December 2024 (refer Annexure 1) has extended the due date for opting for the DTVSV 2024 from 31 December 2024 to 31 January 2025. Accordingly, the Appellant hereby submits that it is in the process of finalizing the Form 1 before the aforementioned extended due date.

In view of the above, we request Your Honours to kindly adjourn the hearing of the captioned appeal to any date convenient to Your Honours

We trust Your Honours will accede to our request and oblige. We apologize for the inconvenience caused in the matter.”

3. Instead of adjourning the appeal, we deem fit to dismiss the appeal as withdrawn. In this regard reference can be made to Circular No.19 of 2024 dated 16/12/2024 and the Guidance Note 2/2024, FAQ No.8 specifies the following: –

4. Thus, here in this case the appeal was pending as on 22/07/2024 and even if appeal is dismissed as withdrawn for the purpose of this scheme, then also assessee is eligible for settlement under the VSVS.

5. The ld. DR also does not have any objection if the appeal is dismissed as withdrawn if the assessee is availing the VSVS scheme.

6. Since assessee is availing VSVS scheme to settle the issue in the aforesaid appeal filed by the assessee, therefore, assessee’s appeal is treated as dismissed as withdrawn. Accordingly, assessee’s appeal is dismissed in limine, with a liberty to the assessee to restore / revive the appeal, in case the application for ‘Vivad Se Vishwas Scheme-2024’ in this appeal does not materialize or is not accepted by the department. With this observation the appeal of the assessee is dismissed as withdrawn.

8. In the result, appeal of the Assessee is dismissed as withdrawn.

Order pronounced on January, 2025.