2002 (11) TMI 83 - HC - Income Tax

Kar Vivad Samadhan Scheme - The question that really falls for consideration in this petition is what is the true interpretation of section 95(i)(c) of the Scheme? In other words, the fate of the petition depends upon the true interpretation of section 95(i)(c) of the Scheme. - it is not in dispute that the appeal filed by the petitioner on December 26, 1998, before the Tribunal was not an admitted appeal as on December 31, 1998, i.e., the date on which the petitioner submitted the declaration but it was only an appeal pending hence, it was hit by section 95(i)(c) of the Scheme resulting in its rejection as not being in conformity with the requirement of the Scheme. In other words, the declaration did not satisfy the requirement of section 95(i)(c) ibid and the Scheme had no application to the declaration submitted by the petitioner.

Summary

Issues Involved:
1. Legality of the rejection of the petitioner's declaration under the Kar Vivad Samadhan Scheme, 1998.
2. Interpretation of Section 95(i)(c) of the Kar Vivad Samadhan Scheme, 1998.
3. Whether the appeal filed by the petitioner was "admitted and pending" as required under Section 95(i)(c).

Issue-wise Detailed Analysis:

1. Legality of the rejection of the petitioner's declaration under the Kar Vivad Samadhan Scheme, 1998:
The petitioner challenged the orders dated February 26, 1999, and December 7, 2001, which rejected their declaration under the Kar Vivad Samadhan Scheme, 1998. The rejection was based on the ground that no appeal/revision was pending on the date of the declaration submission (December 31, 1998). The court upheld the rejection, stating that the appeal was not "admitted and pending" as required by the Scheme.

2. Interpretation of Section 95(i)(c) of the Kar Vivad Samadhan Scheme, 1998:
The court focused on the true interpretation of Section 95(i)(c) of the Scheme, which states that the Scheme shall not apply to cases where no appeal, reference, or writ petition is "admitted and pending" before any appellate authority, High Court, or Supreme Court on the date of filing the declaration. The court emphasized the importance of the words "admitted and pending," indicating that mere filing of an appeal is insufficient; it must be admitted for hearing and pending.

3. Whether the appeal filed by the petitioner was "admitted and pending" as required under Section 95(i)(c):
The petitioner argued that their appeal, filed on December 26, 1998, should be considered pending, and thus they were entitled to the Scheme's benefits. However, the court noted that the appeal was barred by limitation and was not admitted by the Tribunal before the declaration submission date. The court held that for the Scheme's benefits, the appeal must be both admitted for hearing and pending. The Tribunal's subsequent condonation of delay did not retroactively validate the appeal as "admitted and pending" on the relevant date.

The court also addressed the petitioner's argument that the Income-tax (Appellate Tribunal) Rules do not provide for admission of appeals, stating that the rules and the powers of the Appellate Tribunal under Section 253(5) indicate a necessary admission process for appeals. The court dismissed the reliance on Raja Kulkarni v. State of Bombay, AIR 1954 SC 73, as the case was distinguishable due to the absence of the word "admitted" in the relevant section of the Industrial Disputes (Appellate Tribunal) Act.

Conclusion:
The court concluded that the petitioner's appeal was not "admitted and pending" as required by Section 95(i)(c) of the Scheme on the date of filing the declaration. Therefore, the rejection of the declaration was legal and proper, and the writ petition was dismissed.