Direct tax Vivad se Vishwas – Appellant – Communication of assessment order – Order must be served in accordance with section 282 of the Act – Time limit to file appeal had not expired as petitioner had not received the assessment order

Direct tax Vivad se Vishwas – Appellant – Communication of assessment order – Order must be served in accordance with section 282 of the Act – Time limit to file appeal had not expired as petitioner had not received the assessment order

The petitioner had filed a return of income for A.Y. 2012-13 in March, 2013, declaring a total income of Rs. 7,02,170. The respondent issued a notice u/s 148 reopening the assessment for the said A.Y. 2012-13 in March, 2019.

According to the petitioner, he received a notice u/s 274 r/w/s 271 (1)(c) on 25th December, 2019 via e-mail and the said notice was also uploaded on his e-filing portal account. He had responded to the same through the e-filing portal on 23rd January, 2020, pointing out that he had not received the assessment order u/s 143(3) r/w/s 147, nor had the same been uploaded on the e-filing portal and therefore he was unable to reply to the show cause notice.

The petitioner had requested the respondent to send the assessment order to the address mentioned in his letter dated 29th January, 2020 filed on 3rd February, 2020. The petitioner was issued a letter by respondent No. 4, referring to the outstanding demand and directed to pay 20% of the outstanding demand amount. The petitioner once again, by an on-line response dated 8th February, 2020, communicated that the assessment order has not been received at his end; neither was the order uploaded on the e-filing portal nor was it served with the Notice of Demand u/s 156.

In the meantime, the Direct Tax Vivad se Vishwas Act, 2020 (‘DTVSV Act, 2020’) came into force under a Notification dated 17th March, 2020 to help settle matters in respect of disputed tax. The petitioner once again approached the respondents to issue the assessment order. He received the assessment order on 15th December, 2020 – which had been passed on 22nd December, 2019.

Now, u/s 2(1)(a)(ii) of the DTVSV Act, the term ‘appellant’ is defined as being an assessee in whose case the assessment order is passed by the A.O. and the time limit to file an appeal against such order has not expired on 31st January, 2020. The petitioner had opted for the DTVSV scheme by filing an application on 23rd December, 2020 in Forms 1 and 2 of the DTVSV Act and Rules thereunder. However, the status of the application filed by him under the DTVSV scheme showed that the application had been rejected for the reason that he had not filed any appeal against the order in respect of which he wished to avail benefit (an assessee has to file an appeal on or before 31st January, 2020) and since the appeal had not been filed, it did not fulfil the criteria prescribed under the DTVSV Act.

According to the petitioner, while the time limit to file appeal is 30 days from the date of communication of notice of demand u/s 249(2)(b), the benefit of the scheme under the DTVSV Act, 2020 would be available to him as the time limit to file an appeal had not expired because he had not received the assessment order despite repeated requests.

The respondents contended that the petitioner had been given an intimation letter through the e-proceedings on 22nd December, 2019 and, thus, it has to be presumed that the assessment order has been issued and served. It was submitted that the petitioner’s claim of non-receipt of assessment order through the on-line filing portal is difficult to be appreciated as there is no such grievance by any other assessee. Ordinarily, the assessment order is sent alongside. As such, non-receipt of assessment order through on-line filing portal is not probable; therefore, it cannot be said that the order was not issued to the assessee.

On verification, the respondents informed the Court that it does not appear that attachment of assessment order had accompanied the intimation.

In this context, the Court referred to section 282 which refers to service of notice. On perusal of the same, the Court observed that it is clear that the service of an order ought to have been made by delivering or transmitting a copy thereof in the manner contained in section 282, which admittedly had not been done until 15th December, 2020.

The Court observed that this was a peculiar case where the assessment order of 22nd December, 2019 had not been served upon the petitioner till he obtained a copy on 15th December, 2020 and as can be seen from the aforesaid discussion, the petitioner was handicapped from lodging an appeal before the specified date, i.e., 31st January, 2020 for no fault of his. In the circumstances, it would emerge that the petitioner would be able to avail benefit of the term ‘appellant’ under section 2(1)(a)(ii) of the DTVSV Act.

The Court also noted that in Circular No. 9 of 2020 dated 22nd April, 2020 in its reply to Question Nos. 1 and 23, it has been stated that where any order has been passed under the Act and the time limit to file an appeal has not expired on 31st January, 2020, then the assessee can very well opt for the said scheme. The purpose and object behind bringing in the DTVSV Act is to provide resolution of disputed tax matters and to put an end to litigation and unlock revenue detained under litigation.

The respondents were directed to consider the petitioner’s application in accordance with the provisions of the DTVSV Act and Rules. The petition was allowed.