2005 (10) TMI 72 - HC - Income Tax

Application of the petitioner under the Kar Vivad Samadhan Scheme, 1998 was rejected - respondents have considered payment of tax within time on July 6, 19 1999, for the assessment year 1989-90 and refused for the year 1993-94 without assigning any cogent and valid reason. - Therefore, the orders are hereby quashed and the respondents are directed to issue immunity certificates for the assessment year 1993-94 as per provision under sections 90(2) and 91 of the Kar Vivad Samadhan Scheme, 1998.

Summary

Issues Involved:
1. Quashment of documents rejecting the petitioner's application under the Kar Vivad Samadhan Scheme, 1998 (KVSS, 98) for the assessment year 1993-94.
2. Whether the petitioner deposited the required tax within the stipulated time frame.
3. Validity of the respondents' refusal to issue immunity certificates for the assessment year 1993-94.
4. Procedural fairness and adherence to principles of natural justice by the respondents.

Detailed Analysis:

1. Quashment of Documents:
The petitioner sought quashment of documents annexures P9 and P11, which rejected his application under KVSS, 98 for the assessment year 1993-94. The rejection was based on the ground that the petitioner did not deposit the required tax within 30 days as mandated by the modified certificate issued under section 90(1) of KVSS, 98.

2. Timely Deposit of Tax:
The petitioner argued that he deposited the tax within 30 days from the last modified order dated June 7, 1999. The factual matrix showed that the petitioner received multiple certificates with varying tax amounts and deadlines. The petitioner deposited the tax for seven assessment years on two dates: March 31, 1999, and July 6, 1999. The respondents contended that the final order for the assessment year 1993-94 was dated March 26, 1999, and thus the tax was deposited beyond the 30-day period.

3. Validity of Refusal to Issue Immunity Certificates:
The court found that the respondents' refusal to issue immunity certificates for the assessment year 1993-94 was contrary to the documents on record. The respondents issued three certificates, with the last one dated June 7, 1999, which should be considered the final certificate. The petitioner deposited the tax within 30 days from this date. The court noted that each amended certificate superseded the previous one, and thus the computation of the 30-day period should start from the last certificate.

4. Procedural Fairness and Natural Justice:
The court held that the respondents' order dismissing the petitioner's declaration for the year 1993-94 without issuing a show-cause notice or affording an opportunity for a hearing was contrary to the principles of natural justice. The order was deemed a non-speaking order as it lacked reasons for not accepting the declaration for 1993-94. The court emphasized the importance of the principle of audi alteram partem (hear the other side) and passing a reasoned order in the administration of justice.

Conclusion:
The court quashed the orders refusing to issue immunity certificates for the assessment year 1993-94 and directed the respondents to issue the certificates as per sections 90(2) and 91 of KVSS, 98. The court found that the petitioner had deposited the tax within the stipulated time frame based on the last modified order and that the respondents failed to provide a valid reason for their refusal, thus violating principles of natural justice.