2017 (8) TMI 486 - HC - Income Tax

Kar Vivadh Samadhan Scheme (KVSS) benefit eligibility - withdrawing the benefit of KVSS alleging that the petitioner has not paid the amount demanded within due date - Held that - Admittedly the declaration filed by the petitioner was processed and an order in Form No.3 dated 06.05.1999 was issued certifying that the petitioner paid the full tax arrears. On account of some mistakes committed in the calculation Revision Form 2A dated 28.07.2000 was issued stating that the petitioner has to pay further sum of 76, 090 for being entitled to KVSS Scheme. The notice in Revised Form 2A was received by the petitioner on 03.08.2000 and within 30 days from the receipt of the same on 31.08.2000 the petitioner has paid the said sum. However the second respondent would state that the amount was not paid within 30 days from the date of the revised certificate. Similar is the stand taken in the counter affidavit by the respondents at para 10. The elementary principle is that limitation can be computed only from the date of receipt of the order or the proceeding. A mere passing of order by an Officer and keeping it on his file will not be sufficient but the order should be communicated to the assessee or the person aggrieved. Therefore this Court finds that the petitioner has complied with the condition and paid the money within a period of 30 days from the date of receipt of the Revised Form Notice. Hence the impugned orders have been passed on a thorough misconception of the legal position.

Summary

Issues:
Challenge to order withdrawing benefit of Kar Vivadh Samadhan Scheme (KVSS) - Compliance with payment deadline - Calculation mistakes leading to additional payment demand - Communication of revised certificate - Computation of limitation period - Entitlement to KVSS Scheme for Assessment year 1995-96.

Analysis:
The petitioner filed two Writ Petitions challenging orders by different respondents. The first petition challenged the withdrawal of KVSS benefit by the second respondent due to alleged non-payment within the deadline. The second petition sought to quash an order by the first respondent directing the petitioner to pay an additional sum and grant KVSS benefit for the Assessment year 1995-96.

The petitioner had initially paid the full tax arrears as demanded, leading to a certification of entitlement for immunity from prosecution under the Income Tax Act, 1961. However, a revision form issued later demanded further payment, which the petitioner paid within 30 days of receiving the notice. The respondents contended that the payment was not made within 30 days from the revised certificate date.

The Court emphasized that limitation for compliance should be calculated from the date of receipt of the order or proceeding, requiring communication to the assessee. As the petitioner paid within 30 days of receiving the revised notice, the Court found compliance with the condition and criticized the misconception in the impugned orders.

Consequently, the Court held in favor of the petitioner in both Writ Petitions, setting aside the impugned orders. No costs were awarded, and the connected Miscellaneous Petition was closed.