VENUGOPALA REDDY Y Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) BY this writ petition, the order of the Commissioner of Income-tax dated January 19, 1999, passed under the Kar Vivad Sama-dhan Scheme, has been challenged. The prayer made for revision of calculation to the Commissioner of Income-tax was rejected on January 19, 1999. The petitioner moved the Central Board of Direct Taxes on January 1, 1999, stating that the amount along with the returns should be appropriated towards tax but not towards interest. In pursuance of the representation the petitioner was informed that the Scheme of 1998 is different from Section 140A of the Income-tax Act.

(2.) LEARNED counsel for the petitioner submitted that, the Finance Minister in his Budget Speech, while explaining the objectives of the Kar Vivad Samadhan Scheme, observed (see [1998] 231 ITR (St.) 67) :

(3.) THE answer to the question was given that part payments are appropriated first towards tax and then towards interest. It is also submitted that, power has been given under Section 96 of the Kar Vivad Samadhan Scheme, 1998, to the Central Government to issue instructions which are binding on the respondents and since a clarification has already been given by the Government, the Commissioner should have accepted it, in view of the provisions of Section 96(2) of the Scheme, 1998.