2013 (7) TMI 575 - HC - Income Tax

Determining Tax Arrears order u/s 90 - whether Revenue could prosecute an appeal in respect of an assessment year, covered under the Kar Vivad Samadhan Scheme - Held that - The designated authority having determined the tax arrears as defined under the Act, would be deemed to include the amount of tax determined in respect of that assessment year as modified by any appellate order, but remaining unpaid on the date of declaration and further it would include such arrears, which after determination have been set aside - Court relied upon Killick Nixon Ltd., V/s. Dy. CIT (2002 (11) TMI 5 - SUPREME Court)- Sec. 90 required the designated authority to determine the amount payable by the declarant in accordance with the provisions of the Scheme and grant a certificate setting forth the particulars of the tax arrears and the sum payable after such determination towards full and final settlement of tax arrears - upon payment of such amount, determined and on an order having been passed u/s 90(1) - it is conclusive and shall not be reopened - In the instant case, the designated authority having issued such a certificate, the same attains finality appeal decided against revenue.

Summary

Issues:
1. Maintainability of appeal under Kar Vivad Samadhan Scheme (KVSS) for assessment years 1993-94 and 1994-95.

Analysis:
The judgment pertains to two appeals concerning the same assessee for the assessment years 1993-94 and 1994-95. During the appeal hearing before the Tribunal, the assessee presented a Certificate issued by the Commissioner of Income-Tax under the Kar Vivad Samadhan Scheme (KVSS) 1988, indicating full payment of taxes for the mentioned assessment years. Consequently, the appeal was deemed infructuous and dismissed by the Tribunal, prompting the Revenue to appeal against this decision.

The key issue revolved around whether the Revenue could pursue an appeal for assessment years covered by the KVSS. Reference was made to a previous decision in the case of Bhawaralal (HUF) v. Assistant Commissioner of Income Tax, where instructions were issued by the Central Government regarding the implementation of the Scheme. The Court highlighted that the Scheme required consideration of tax arrears for the relevant assessment year, regardless of whether the dispute was raised in an appeal by the assessee or the Revenue.

Furthermore, the judgment cited the decision of the Supreme Court in Killick Nixon Ltd. v. Dy. CIT, emphasizing the applicability of the law to the present case. The Court concluded that the designated authority's issuance of a certificate under the Scheme signified finality, in line with the provisions of Section 90. As a result, the appeals were deemed meritless and rejected based on established legal principles and precedents.

In essence, the Court's analysis focused on the interpretation and application of the KVSS in determining the maintainability of appeals by the Revenue for the specified assessment years. The judgment underscored the importance of adhering to the Scheme's provisions and relevant legal precedents to resolve the issue at hand effectively.