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TMI Blog2006 (4) TMI 114X X X X Extracts X X X X X X X X Extracts X X X X ..... the preliminary objection regarding the maintainability of the Department's appeals, in view of the declaration granted to the petitioner under section 90 of the Finance (No. 2) Act, 1998. 2. All the appeals have been admitted on the following common questions of law : (1) Whether the Income-tax Appellate Tribunal was justified in holding that the appeal filed by the Revenue would survive for hearing notwithstanding the issuance and eventually acceptance of a declaration submitted by the assessee (appellant herein) under the KVS Scheme in full and final satisfaction of the demands for the year in question in an appeal filed by assessee ? (2) Whether the Income-tax Appellate Tribunal was right in holding that a separate declaration under the KVS Scheme was required to be filed in the case of an appeal filed by the Department and in the absence of not filing such a declaration by the assessee, the appeal filed by the Revenue will have to be heard on its own merits ? (3) Whether the Income-tax Appellate Tribunal acted contrary to the law, when it refused to follow its earlier decisions taking the view in favour of the assessee on the identically situated facts ? 3. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erable revenue also gets locked up in such disputes. Declogging the system will not only incentives honest tax-payers, enable the Government to realise its reasonable dues much earlier but coupled with administrative measures, would make the system more user friendly. I, therefore, propose to introduce a new scheme called 'Samadhan'. The scheme would apply to both direct taxes and indirect taxes and offer waiver of interest, penalty and immunity from prosecution on payment of arrears of direct tax at the current rates." 5. Prompted by the assurance given and the provisions of the scheme, the appellant duly made a declaration to the designated authority in accordance with the provisions of section 89 in respect of tax arrears and after payment of tax in accordance with the said scheme, a due certificate was issued to him by the designated authority in accordance therewith. Acting upon the provisions of the scheme, an application was filed before the ITAT for dismissing the appeals pending before it. The ITAT, however, was of the view that the composition of the amount under the scheme and the certificate granted thereunder did not have any adverse effect on the pending appeals o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rs to be furnished in the declaration. It says that a declaration under section 88 shall be made to the designated authority and shall be in such form and shall be verified in such manner as may be prescribed. 8. We may pause here to point out that power has been left to the authorities to prescribe mode and manner in which the declaration may be made and it is open to the authorities to make it compulsory for an assessee to give details including the details with regard to the remedies resorted to by the Department against the assessee including remedy against the order reducing the liability by any lower authority and other information consistent with the object of the Act. 9. Section 90 provides that within 60 days from the date of receipt of the declaration under section 88, the designated authority shall grant a certificate in such form and setting forth such particulars therein with regard to the tax arrear and the sum payable after determination towards full and final settlement of tax arrears. As the controversy devolves around the provisions of sections 90, 91 and 92, for ready reference these provisions are being reproduced hereunder (see [1998] 232 ITR (St.) 31, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h writ petition, appeal or reference and after withdrawal of such writ petition, appeal or reference with the leave of the court, furnish proof of such withdrawal along with the intimation referred to in sub-section (2). 91 . Immunity from prosecution and imposition of penalty in certain cases.— The designated authority shall, subject to the conditions provided in section 90, grant immunity from instituting any proceeding for prosecution for any offence under any direct tax enactment or indirect tax enactment, or from the imposition of penalty under any of such enactments, in respect of matters covered in the declaration under section 88. 92. Appellate authority not to proceed in certain cases.— No appellate authority shall proceed to decide any issue relating to the disputed chargeable expenditure, disputed chargeable interest, disputed income, disputed wealth, disputed value of gift or tax arrear specified in the declaration and in respect of which an order had been made under section 90 by the designated authority or the payment of the sum determined under that section : Provided that in case an appeal is filed by a Department of the Central Government in respect of s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts in creating two artificial classes between the same class of assessees, i.e., the litigating assessees in arrears ; (2) the definition of 'tax arrears' in clause (m) of section 87 should be so read as to mean the amount of tax, penalty or interest determined by any competent authority on or before March 31, 1998, though such determination might have been set aside at a later stage, if such setting aside has not been accepted by the Department and continues to remain under challenge before a court or the Tribunal. (3) The rest of the scheme is intra vires the Constitution." 12. Though learned counsel for the Revenue has vehemently argued that the decision of the Delhi High Court should not be taken as conclusive in view of the decision of the Andhra Pradesh High Court in Dr. (Mrs.) Renuka Datla v. CIT [1999] 240 ITR 463, we find that the case relied upon by learned counsel is distinguishable. In the said case there was no tax arrear against the assessee within the meaning of clause (m) of section 87 nor any disputed tax or income on the date of the declaration. Also, no appeal was pending on the date of filing of declaration in respect of the tax arrears for the clearance ..... X X X X Extracts X X X X X X X X Extracts X X X X
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