ITTA/22/2026 of Smt. Neetha Pulasani Vs The Income Tax Officer on 25 February 2026

J3447 I IN THE HIGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD WEDNESDAY, THE TWENTY FIFTH DAY OF FEBRUARY TWO THOUSAND AND TWENTY SIX PRESENT THE HONOURABLE SRI JUSTICE P.SAM KOSHY AND THE HONOURABLE SRIJUSTIGE NARSING RAO NANDIKONDA lncome Tax Tribunal Appeal Under Section 260 A of the lncome Tax Act,1961 against the Order dated 03t11t2025 passed in M.A. No. 71lHydl2o25 in tfR No.tOg3t$ydt2019 for the Assessment Year 2015-2016 on the file of the lncome Tax Appellate Tribunal, Hyderabad Bench 'B', Hyderabad. Between: Smt. Neetha Pulasani, Wo. P Sukendra Reddy, age 63 years, A'23, Plot No. 23, Dews Villa Manchirevula village, Rajendranagar Mandal Ranga Reddy District PAN- AFNPP6473J. ...APPELLANT AND The lncorne Tax Officer, Ward - 14(1), Hyderabad .RESPONDENT Counsel for the Appellant : Sri C P Ramaswanti Counsel for the Respondent : Ms. B Sapna Reddy, Senior Standing Counsel for the lncome Tax DePartment The Court delivered the following: Judgment k IN THE IITGH COURT FOR THE STATE OF TELANGANA AT HYDERABAD TH,E HONOURABLE SRI JUSTICE P.SAM KOSHY AND THII HONOURABLE SRI JUSTICE NARSING RAO NANDTKONDA F

25.02.2026 Between Smt. Neetha Pulasani ...Appellant AND The Incorne Tax Offrcer, Ward-I4( I ), Hyderabad. JUDGMIENT: (per Hon'ble Sri Justice P.Sam Koshy) Heirrd Mr, C.P.Ramaswami, learned counsel for the petitioner and Ms. B.Sapna Reddy, learned Senior Standing Counsel for the Income Tax Department for the respondent. Perused the record.

2. The; instant appeal has been preferred assailing the order of the Inconre Tax Appellate Tribunal (ITAT) dated 03.11.2025 passed in M.A.No.71lHyd12025, arising out of I.T.A.No.1033/ Hydl20l9

3. The facts, in brief, are that the appellant is a home-maker and claims to have studied till Class X. The appellant for the assessment year 2015-16 had submitted a taxable income of Rs.14,75,6601-. The said return of income of the appellant was subjected to scrutiny and subsequently vide order dated 29.12.2017 passed by the Assessing Officer, the demand was raised for Rs.68,16,8201- disallowing the exemption under Section 54 of the lncome Tax Act, 196l (for short, 'the Act'). The appellant immediately preferred an appeal before the Commissioner of lncome Tax (Appeals) which too stood decided against the appellant vide order dated 28.03.2019. The said order was subjected to challenge before the ITAT, Hyderabad Bench which was registered as [.T.A.No.1033/ Hydl20l9.

4. For ready reference, the order passed by the ITAT on 25.48.2021 while disposing of the appeal is being reproduced hereunder: "At the outset, the ld. AR submitted that the assessee has opted to avail the benefit under the 'Direct Tax Vivad Se Vishwas Act, 2Q2O' in prescribed Forms 1 and 2, and Form 3 also was issued by the Pr. CIT-6, copy of which is placed on a.

record, and requested the Bench to permit the assessee to withdraw the appeal. Having regard to the facts and circumstances of the case, we are inclined to dismiss the appeal of the assessee as withdrawn, since the assesee has preferred to avail the Vivad-se-Vishwas Scheme and also received Form-3 in tune thereto, with a rider that it shall be very much open for the assessee to file for revival of this case, if the settlement benefit under the scheme is denied to the assessee for technical reasons".

5. ln view of the aforesaid progress of the matter that of the appellant having approached the authorities under The Direct Tax Vivad Se \/ishwas Act, 2020 and where the claim of the appellant was deterrnined under the said Vivad Se Vishwas Scheme vide order dated 31.12.2020 out of demand of Rs.68,16,8201-, the amount under the Vivad Se Vishwas Scheme payable was reduced to Rs.44,39,4151- if it is paid up to 3 I .03.2021 and if the amount is paid beyond 3I.03.2021, the amount to be paid was Rs.48,83,3:;71-. It appears that the appellant was not in a position to make the entire amount of Rs.48,83,3571-, but could make a payment ol' Rs.31,59,830/-, up till September, 202l. Thereafter, the appellant again approached the respondent authorities under the Vivad Se Vishwas Scheme,2024 and the application finally stood rejected on 12.03.2025. Meanwhile, the appellant had filed a miscellaneous application before the ITAT under Section 254(2) of the Act seeking for restoration of I.T.A.No.1033iHydl20l9 which at the first instance was disposed of on 25.08.2021 permitting the appellant to approach the department under the Vivad Se Vishwas Scheme. It is this miscellaneous application which now stands rejected vide order dated 03.1 I .2025 and which led to filing of the present appeal

6. At the outset, the learned counsel for the appellant submits that the limited relief that the appellant seeks for in the present appeal is for setting aside the order of the Tribunal and for remitting the matter back after restoring I.T.A.No.l033l[ydl20l9 so that the appeal which the appellant had preferred against the orders of the Assessing Officer dated 29.12.2017 and 28.03.2019 be decided on its own merits in accordance with law. According to the appellant, the earlier order of the Tribunal dated 25.09.2019 was without entering into the merits of the case and as such the grounds of appeal in I.T.A.No.1033/Hydl20l9 are still open to be e. -..

decided or merits. The further contention of the appellant is that in the evert ofnon-restoration ofthe said appeal, on the one hand the appeal stands decided without any adjudication on the grounds raised in the appeal and on the other, the appellant in the meanwhilt: has already parted more than Rs.3 I lakhs under the Vivad Se \/ishwas Scheme with the department and now would be left remed:less so far as the original demand of Rs.68,16,820/- is concemed. The leamed counsel for the appellant also makes a submission that in the event if the appeal is restored, there is also a possibility for the appellant to approach the authorities for settlement of the dispute again under the prevailing Vivad Se Vishwas Scheme so far as the balance amount payable ts concerned and for which also the contention of the learned counsel for the appellant is that restoration of the appeal would be mandatorily'required, as in the absence ofany appeal pending, the authorities rvould not be in position to entertain the application of the appellant for settlement under the Vivad Se Vishwas Scheme. Though it ir; after the order passed under the Vivasd Se Vishwas Scheme at the first instance on 31.03.2020, there does not seem to

( have serious efforts made by the appellant in approaching the department seeking for extension of time for the balance payments to be made in terms of the order under the Vivasd Se Vishwas Scheme dated 31.12.2020. There also does not seem to be any prompt steps taken by the appellant in getting the appeal revived/ restored at the earliest. Both these efforts have been made in the year 2024-25. Though the appellant pleads ignorance on her part that she is not a highly qualified person but only claims herself to have passed Class X, nonetheless the appellant seems to have been taking the assistance of legal experts in the field. Therefore, the ground of ignorance will not come to the rescue of the appellant. Meanwhile, however, another aspect which needs to be considered is the period during which the application under the Vivad Se Vishwas Scheme was accepted i.e., 31.12.2020 which was peak COVID period and which lasted up till March, 2022 Therefore, even there appears to be any default on the part of the appellant, the same can be ignored under the garb of the COVID pandemic which was prevalent up tilt March, 2022. This aspect also needs to be considered by the authorities if the appellant ,1

approaches the department again for availing the benefit under the present <lay Vivad Se Vishwas Scheme which is in operation. The fact which also impresses the Bench is the bonafides on the part of the appellant that in terms of the order under the Vivad Se Vishwas Scheme dated 31.12.2020, the appellant was supposed to deposit Rs.48,83,357l- by September,202l but had already paid an amount of Rs.3 1,59,830/- which definitely amounts to more than 75%o of the amount quantified under the Vivad Se Vishwas Scheme and it was only a portion of the amount which was yet to be paid to the department.

7. Corrsidering the contentions raised by the appellant at the first instance, we are inclined to admit the appeal on the ground as to whether the Tribunal was justified in rejecting the miscellaneous application filed under Section 254(2) of the Act and in reviving the appeal, more particularly when the offer under the Vivad Se Viswas Scheme stands defaulted.

8. For all the aforesaid reasons, we are of the considered opinion thzrt the application sought for by the appellant seeking for restoration of the appeal ought not to hat'e been rejected by the i Tribunal rather the appeal could have been revived/restored and the Tribunal ought to have decided the appeal on its own merits in accordance with law and considering the ground which would also entail the appellant, if she so wants, to approach the respondents for settlement of the dispute under the Vivad Se Vishwas Scheme and for which also the pendency of the appeal becomes necessary.

9. [n view of the same, the appeal stands allowed. The impugned order 03.11 .2025 passed in M.A.No.7llHydl2025 stands set aside, In the process, the appeal t.T.A.No.1033/Hyd/ 2019 stands restored/revived to be decided on its own merits in accordance with law by the Tribunal at the earliest. There shall be no order as to costs. Consequently, miscellaneous petitions pending, if any, shall stand closed. SD/.M.MANJULA JOINT REGISTRAR ,/TRUE COPY// SECTION OFFIGER

1. The lncome Tax Appellate Tribunal, Hyderabad Bench 'B', Hyderabad

2. One CC to Sri C P Ramaswami, Advocate IOPUC]

3. One CC to Ms. B Sapna Reddy, Senior Standing Counsel for the lncome Tax Department [OPUC]

4. Two CD Copies W ai To,

HIGH COI'RT DATED: 2510212026

JUDGMENT

lTTA.No.22i, of 2026 ALLOWING THE ITTA WITHOUT C}OSTS oot 1 2 \!,q ntr * 0R rdE s ( e { "S ircHr, * K} 1 ,l lr L6