Lex not cogit impossibila (law does not compel a man to do that which he cannot possibly perform) and impossibilum nulla oblignto est (law does not expect a party to do the impossible) are well known maxims in law and would squarely apply to the present case. In  ACIT v. Kamlakar Moghe (2015) 378 ITR 561 / 125 DTR 273 / 280 CTR 544 / (2016) 236 Taxman 439 (Bom.)(HC) Court held that if REC Bonds are not available during the prescribed period, time for investment has to be extended  . The same principle is applied in  CIT v. Cello Plast (2012) 76 DTR 439 / 209 Taxman 617 / 253 CTR 246 (Bom.)(HC). The assessee can make investment belatedly . The assessee can make an application to CBDT to condone the delay in making the investment. If CBDT rejects the application the assesee can approach High Court by filing writ against the order of the CBDT .

From our understanding, if the amount was disclosed in sales and tax has been paid on profit earned, the same cannot be taxed again under section 68 of the Act. Therefore, prima facie the case seems to have merit. 

If the assessee avails  the benefit of the scheme. Whether consequential entries in the books of account can be passed or not is debatable . Each case may have to be judged from the facts of the case .  Issue is raised before the CBDT in number of matters. We hope we may get some clarification on the issue of consequential entries in the books of account . 

As per Question No. 8 of CBDT Circular No. 9 of 2020 dated April 22, 2020, it would not be possible for the appellant to apply for settlement of penalty appeal only when the appeal on disputed tax related to such penalty is still pending.? 

Q .8 reads as under  imagine a case where an appellant desires to settle concealment penalty pending before CIT (A), while continuing to litigate quantum  appeal  that  has travelled to higher appellate  forum. Considering these are two independent and different appeals, whether appellant can settle one  to exclusion  of others?  If    yes, whether settlement of penalty  appeal will have any  impact  on  quantum  appeal? 

Ans : If both quantum appeal covering disputed tax and appeal against penalty levied on such disputed tax for an assessment year are pending, the declarant is required to file a declaration form covering both disputed tax appeal and penalty appeal. However, he would be required to pay relevant percentage of disputed tax only. Further, it would not be possible for the appellant to apply for settlement of penalty appeal only when  the appeal on disputed tax related to such penalty is still pending. 

There cannot be general guidelines , one has to take the decision considering the facts of each case . One may consider following issues may be worth settling ;  

-Honourable Tribunal in many of the matters held that no disallowance u/s 14A of the Act can be made in respect  strategic investments  however the Honourable Supreme Court in  Maxopp Investment Ltd ( 2008) 402 ITR 640 (SC) up held the disallowances on strategic investments   also refer , Ashish Estate & Properties (P.) Ltd. v. CIT (2018) 257 Taxman 585 (Bom.)(HC)

 -The department may be in appeal before the High Court or before Appellate Tribunal. Now the Supreme Court is against the assessee in   hence such issues it may be desirable to settle by paying only 50% of tax in dispute.

-In case of Bogus purchases, the Tribunal has estimated the GP and the assesees have filed an  appeal against the order of the Tribunal to avoid the penalty and prosecution. In such cases it may be desirable for the assesees to approach the scheme.

-Appeal matters  relating to, bogus penny stocks , bogus share capital , bogus expenses etc  are desired to be settled under the Scheme. 

-In Bombay High Court appeals since 2003 are pending for final disposal. There could be matters which are covered against the assessee by the Supreme Court, Jurisdictional High Court, or other High Courts considering the merits of the case the  it may be desirable for such an assesses to avail the Vivad se Vishaws Scheme.

It is pertinent to refer to the decision of the Hon’ble Supreme Court in the case of Suo Motu Writ Petition (Civil) No(s).3/2020 dated March 23, 2020  www.itatonline.org wherein it has been held that to ease the difficulties faced by the litigants and their lawyers across the country in filing their petition/ applications/ suits/ appeals, irrespective of the limitation prescribed under the general law or Special Laws whether condonable or not shall stand extended w.e.f. 15^th  March 2020 till further order/s to be passed by this Court in present proceedings.

Therefore, in the event where the last date for filing of appeal was on or after March 15, 2020, the same shall be extended according to the order. Therefore, the status of the deemed appeal under VSVA shall not be affected.

In such a scenario, the assessee should be permitted to treat the matter set aside to the CIT(A) as different from the appeal against the order of the Ld. AO as both appeals emanate from different orders of the  AO. The assessee  can  avail an option to declare either of the two appeals or both under the VSVA. One may refer  Q. No.14 which reads as under “ Whether assessee can avail of the Vivad se Vishwas for some of the issues and not accept other issues?  “

Ans : “Refer to answer to question no 11. Picking and choosing issues for settlement of an appeal is not allowed. With respect to one order, the appellant must chose to settle all issues and then only he would be eligible to file declaration.” 

On the facts of the querist there are two separate orders and two separate appeals . Accordingly the querist can avail the benefit in respect of either of the two appeals or both under VSVA . 

In ACIT v. Ajay Kalia (2016) 157 ITD 187 (Delhi) (Trib) held that though the cross objection of the revenue is dismissed because of low tax effect, the cross objection could not be dismissed. Cross objection survives and considered as an appeal. In   Badru (Since Deceased) through L.R. and Ors. v. NTPC Ltd  and Ors. AIR 2019 SC  3385  the Apex Court held that cross objection to be disposed of independently on merits . Accordingly, the assessee is eligible for VSVA. 

Yes . In Jehangir H.C . Jehangir v ITO ( 2015) 229 Taxman 392 ( Bom) (HC)  held that  issue specifically taken before the AO could not be refused  to be considered by Tribunal merely because the CIT (A)  did not have any view on it . Order of Tribunal was set aside.  Accordingly, the Querist can avail the benefit of VSVA. In respect of all the issues pending before the Tribunal In  All Cargo Global Logistics Ltd. v. Dy. CIT (2012) 137 ITD 26 / 72 DTR 1 / 146 TTJ 657 / 16 ITR 38 (SB)(Mum.)(Trib.)   the SB held that , a pure question of law arises for which facts are on record of the authorities below , the question should be allowed to be raised if it is necessary to assessee the correct tax liability . Revenue has challenged the order of Special Bench before the High Court  on other grounds and not on the issue of admission of additional grounds. CIT v. All Cargo Global Logistics Ltd. (2015) 374 ITR 645 / 120 DTR 89/279 CTR 389 / 232 Taxman 270 (Bom.)(HC) 

Accordingly the assessee can avail the benefit of the scheme in respect of entire appeal which is pending before the ITAT .   

Yes , TDS paid has to be considered, dealing with IDS scheme the Delhi High Court held that there is no bar for an assessee or declarant to claim credit of advance tax and TDS paid previously relating to assessment years for which it seeks benefit under. Kumudam Publications P. Ltd. v. CBDT (2017) 393 ITR 599 /247 Taxman 25/294 CTR 54 /150 DTR 33 (Delhi) (HC) SLP of revenue is dismissed ; CBDT v  Kumudam Publications P. Ltd ( 2020) 269 Taxman 207 (SC) .   The Direct Tax Vivad Se Viswas Act 2020 S. 2(k)  reads as under . “ Income -tax Act “ means the Income -tax Act , 1961 ; S.2. 2. reads as  under “   The words and expressions used herein and not defined but defined in the Income-tax Act shall have the meanings respectively assigned to them in that Act.” 

Accordingly the  TDS paid relating to the assessment has to be considered .

Rectification u/s 254 (2) is continuation of appeal proceedings before the ITAT,   hence one may take the view that even when rectification application is pending it can be construed as pending. let us take an example if rectification is allowed the appeal is restored ,  it relate back the date of filing of an appeal. Hence the assessee can opt for the scheme when the miscellaneous application is pending for final disposal.  One may   have to consider in following cases the Courts have held that order rejecting the application made u/s. 254(2) of the Act is not maintainable. Chem Amit v. ACIT (2005) 272 ITR 397 (Bom.)(HC) , Safari Mercantile Pvt. Ltd. v. ITAT (2016) 386 ITR 4 (Bom.) (HC), CIT v. Singhal Industries (2017) 395 ITR 264 (Raj) (HC), Madhav Marbles & Granites v. ITAT (2012) 65 DTR 217 / 246 CTR 243 / 2012 Tax LR 465 (Raj.)(HC)

However, in L. Shobanraj v  Dy.CIT ( 2003) 260 ITR 155 (Karn) (HC) DCIT v. H.V. Shantharam (2003) 260 ITR 156 (Karn)(HC) The Hon’ble Karnataka High Court has taken a view that an appeal u/s. 260A lies against an order u/s. 254(2) of the Act on a substantial question of law.  It may be desirable to Board clarify the issue.