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TMI Blog2006 (7) TMI 116X X X X Extracts X X X X X X X X Extracts X X X X ..... sailing the assessment made under the Kar Vivad Samadhan Scheme, 1998, as per order (P/4), dated February 19, 1999. 2. Precisely the submission of the petitioner in this petition is that the disputed income has been worked out on the basis of disputed tax which does not include levy of additional tax under section 143(1A) of the Income-tax Act, 1961. 3. The petitioner has submitted that for the assessment years 1994-95 and1995-96 disputed income was worked out. The petitioner filed a declaration under section 89 read with section 88 of the Finance (No. 2) Act, 1998, for settlement of tax payable to respondent No. 1. The total tax payable on the aforesaid amount was worked out to Rs.2,13,310. Respondent No.1 did not accept the afores ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... titioner under the Scheme was correct. Determination made by the Commissioner by including the figure of additional tax is illegal. The additional tax is not relatable to the determination of income. It is in the nature of a penalty which is imposed on an assessee in those cases where prima facie adjustments are made under section 143(1)(a) of the Income-tax Act, 1961. It is not relatable to the determination of income. Thus, it cannot be taken into account in determination of disputed income on which tax is payable at 30 per cent. under the Scheme. Circular (P/8) dated November 6, 1998, has been relied upon. Hence, this writ petition has been preferred for quashment of the order (P/4). 5. It is submitted in the return that for the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment year means whole or so much of the total income as is relatable to the disputed tax. The term "disputed tax" has been defined in section 87(f) of the Scheme which means the total tax determined and payable in respect of an assessment year but which remains unpaid as on the date of making the declaration under section 88 of the Scheme. The Central Board of Direct Taxes in its clarification in response to question No. 6 has given a clarification with regard to the treatment of additional tax. The question and answer is reproduced below (see [1998] 233 ITR (St.) 50, 51) "Question No. 6: Where in an assessment made under section 143(1) (a), the Assessing Officer makes certain adjustments to the total income and levies additional ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he 31st day of March, 1998, under that enactment in respect of an assessment year as modified in consequence of giving effect to an appellate order but remaining unpaid on the date of declaration; (ii) in relation to indirect tax enactment,— (a) the amount of duties (including drawback of duty, credit of duty or any amount representing duty), cesses, interest, fine or penalty determined as due or payable under that enactment as on the 31st day of March, 1998, but remaining unpaid as on the date of making a declaration under section 88; or (b) the amount of duties (including drawback of duty, credit of duty or any amount representing duty), cesses, interest, fine or penalty which constitutes the subject-matter of a demand notice or a s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inition makes it clear that total tax is determined and payable in respect of an assessment year under any direct tax enactment. Additional tax imposed under section 143(1A) is also a tax under the Act, which was unpaid on the date of filing of declaration under section 88. Apart from that, it is clear from the aforesaid quoted Central Board of Direct Taxes explanation to question No. 6 that additional tax is treated a part of the tax. Thus, I find that while passing the order (P/4) by respondent No. 1, Commissioner has not committed an illegality in computation which has been made. Inclusion of additional tax in arrear of tax is found to be proper and in accordance with the provisions of various sections of the Scheme and clarification iss ..... X X X X Extracts X X X X X X X X Extracts X X X X
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