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TMI Blog2002 (9) TMI 101X X X X Extracts X X X X X X X X Extracts X X X X ..... ame matter on which the show-cause notice has been issued to the main declarant. Then the order provides that a settlement in favour of the declarant will be deemed to be full and final in respect of other persons also. This order has to be read as a whole. Thus, even though the show-cause notice may have been adjudicated upon and an appeal is pending a party could still take the benefit of the Kar Vivad Samadhan Scheme and file a declaration. The object of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order is to give benefit of a settlement by the main party (i.e., the company in this case) to all other co-noticees. Admittedly, in this case, all the officers have paid the amounts in pursuance of the declaration made by them under section 88. Even if they have paid the amounts under protest they are not entitled to refund. The directors/officers in Kerala would also not have been entitled to refund by virtue of section 93. However, section 93 does not seem to have been pointed out to the High Court of Kerala. As, pursuant to the order of the High Court of Kerala, they have received refund we do not direct that they should repay the amounts to the Revenue. - Civil ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , (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 show-cause notice issued on or before the 31st day of March, 1998 under that enactment but remaining unpaid on the date of making a declaration under section 88, but does not include any demand relating to erroneous refund and where a show-cause notice is issued to the declarant in respect of seizure of goods and demand of duties, the tax arrear shall not include the duties on such seized goods where such duties on the seized goods have not been quantified. Explanation. -Where a declarant has already paid either voluntarily or under protest, any amount of duties, cesses, interest, fine or penalty specified in this sub-clause, on or before the date of making a declaration by h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f duty or any amount representing duty), cesses, interest, fine or penalty which constitutes the subject matter of a demand notice or a show-cause notice issued on or before the 31st day of March, 1998, but remaining unpaid and pending determination on the date of making a declaration and, where, in respect of the same matter stated in the said declaration, a show-cause notice has also been issued to any other person and is pending adjudication on the date of making the declaration, then, no civil proceeding for imposition of fine or penalty shall be proceeded with against such other person and in such cases the settlement in favour of the declarant under sub-section (1) of section 90 shall be deemed to be full and final in respect of such other person also on whom a show-cause notice was issued on the same matter covered under the declaration." The Commissioner of Customs and Central Excise issued a clarificatory note dated 16th December, 1998, wherein it was clarified that the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order only applied to cases where the show-cause notices had been issued on or before March 31, 1998, and where such notices were pending adjudication. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e company but also by each of the officers. Relying upon the provisions of the Kar Vivad Samadhan Scheme, Mr. Ganesh submitted that the Scheme was very clear. He submitted that the declarations had to be filed, not only by the company but by each of the directors/officers on whom show-cause notice had been issued. He submitted that each declaration had to be separately dealt with and a settlement amount arrived at for each declaration. He submitted that each declarant would then have to pay the amount settled. He submitted that a plain reading of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order showed that the benefit was to be given only in those cases where the show-cause notices were still pending adjudication. He submitted that once the show-cause notice had been adjudicated upon, as admittedly they were in this case, the directors/ officers were not entitled to the benefit of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order. He submitted that this position had been made clear by the clarificatory note dated December 16, 1998, which had been issued by the Commissioner. He submitted that the judgment of the High Court of Gujarat is the correct judgme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fficers. Thus they get no immunity under section 91 on a settlement by the company. Mr. Vellapally next submitted that the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order, if read as a whole, makes it clear that the benefit of the declaration made by the company was to accrue even to the officers of the company so long as the adjudication proceedings were pending. He submitted that the interpretation sought to be given by the Department would render nugatory the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order. He submitted that such an interpretation would lead to uncertainty. He submitted that the applicability of the order could not depend upon whether or not an officer has proceeded with adjudication expeditiously or not. He submitted that the object was to give benefit to all directors/officers of the company. He submitted that the restricted interpretation would defeat the object. We have heard the parties. In our view, a reading of the Kar Vivad Samadhan Scheme (Removal of Difficulties) Order shows that where a declaration had been made in respect of a tax arrear and where in respect of the same matter a show-cause notice had also been issued to any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It is settled law that if two views are possible then the one which is in favour of the assessee must be adopted. On this ground also the interpretation sought to be given by Mr. Ganesh cannot be accepted. In this view of the matter, Civil Appeals Nos. 6260-6265 of 2000 are dismissed. Civil Appeals Nos. 633 to 642 of 2002 are accordingly allowed and the judgment of the High Court of Gujarat is set aside. The question now arises whether the directors/officers are entitled to a refund. Section 93 of the Kar Vivad Samadhan Scheme reads as follows: "93. Any amount paid in pursuance of a declaration made under section 88 shall not be refundable under any circumstances." Admittedly, in this case, all the officers have paid the amounts in pursuance of the declaration made by them under section 88. Even if they have paid the amounts under protest they are not entitled to refund. The directors/officers in Kerala would also not have been entitled to refund by virtue of section 93. However, section 93 does not seem to have been pointed out to the High Court of Kerala. As, pursuant to the order of the High Court of Kerala, they have received refund we do not direct that they should ..... X X X X Extracts X X X X X X X X Extracts X X X X
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