Domino Printing Sciences PLC Vs CIT (Delhi High Court)
Patna High Court held that taxpayer will not be eligible for Direct Tax Vivad Se Vishwas Scheme 2024 [DTVSV Scheme] against notice issued under section 148 of the Income Tax Act since dispute tax is not ascertainable.
Facts- The petitioner is a company incorporated under the laws of the United Kingdom and is engaged in the business of manufacture and sale of coding and marking equipments; manufacture and sale of consumables; sale of spares; and rendering of after sales services. The petitioner has filed the present petition under Article 226 of the Constitution of India being aggrieved by the decision of the respondent [Designated Authority] to reject the petitioner’s declaration made in the prescribed form (Form 1) under the Direct Tax Vivad Se Vishwas Scheme, 2024 [DTVSV Scheme].
Conclusion- Held that at the stage of reopening of the assessment, it is not ascertained whether the income of the assessee chargeable to tax has escaped assessment. The quantum of any such income and tax payable on the same is yet to be determined; the same is determined by the AO at the culmination of the proceedings. There is no determination of the “disputed income”, “disputed tax”, “tax arrear”, “disputed penalty” and “disputed interest” at the stage of issuance of notice under Section 148 or 148A of the Act. Consequently, it would be impossible to determine the amount payable for settlement of the dispute under DTVSV Scheme which in terms of Section 90 of Finance (No.2) Act, 2024 is based on the quantum of “disputed tax”, “disputed penalty”, “disputed interest” or “disputed fee.” It is in this context that the FAQ No.26 of CBDT Circular No.12 of 2024 dated 15.10.2024 clarifies that in such cases DTVSV Scheme would be inapplicable. The FAQ 26 expressly indicates that it is in respect of writ petitions challenging notices issued under Section 148 or 148A of the Act. More importantly, the principle on the basis of which the clarification is rendered – that the disputed tax is not determined – is wholly inapplicable in the facts of the present case.
