LEELAMMA JOHN Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) The question involved in both these cases is similar and they are disposed of by a common judgment. Petitioners in both these Original Petitions were partners of a Firm called M/s. Thoppil Finance, which was an assessee under the Income Tax Act. By order dated 25.9.1997 of the Settlement Commission, the Assessing Authority, viz., the Assistant Commissioner of Income Tax, Investigation Circle I, Division I, Ernakulam revised the assessment of the petitioners and passed orders under S.155 of the Income Tax Act (hereinafter referred to as 'the Act'), redetermining the tax, surcharge and interest payable by the petitioners for the assessment year 1992-93. Ext. P1 in both these cases are the assessment orders. The revised assessment included interest under S.234A, 234B and 234C of the Act. While the petitioner in O. P. No. 4416/99 was assessed to an interest of Rs. 7,90,095/-, the petitioner in O. P. No. 4347/99 was levied an interest of Rs. 3,71,348/-.

(2.) Aggrieved by the levy of interest, the petitioners filed revisions under S.264 of the Act before the respondent. Copies of the revision petitions are produced in both these cases as Ext. P2. Thereafter, the petitioners filed before the respondent, who is the designated authority under the Kar Vivad Samadhan Scheme, 1998 applications in the prescribed form with necessary particulars seeking the benefits of the scheme. True copies of the applications are produced as Ext. P3 in both these cases. The petitioners thereafter received notices of hearing on revision petitions on 10.11.1998. The petitioners brought to the notice of the respondent about the filing of the applications under the Kar Vivad Samadhan Scheme and requested to keep the revision petitions pending till decisions are taken on the declarations filed by the petitioners. But by letter dated 14.12.1998, the respondent held that the revision petitions filed by the petitioners were not maintainable and cannot be treated as valid revision petitions. Hence, it was held that the declarations filed by the petitioners under the Kar Vivad Samadhan Scheme will not be acted upon. Copies of the letters dated 14.12.1998 are produced in both these cases as Ext. P5. The petitioners further filed petitions to reconsider Ext. P5. But the same was dismissed by Ext. P6. Ext. P7 is another communication by which it was held that since the revision petitions were not the valid revision petitions on the date of filing of the declarations under the Kar Vivad Samadhan Scheme, the assessments had not been challenged and hence, the petitioners are not entitled to the benefits of the Kar Vivad Samadhan Scheme.

(3.) The Original Petitions had been filed challenging Exts. P5, P6 and P7 in both the cases and for a mandamus directing to dispose of Ext. P3 declarations on merits and in accordance with the provisions of Kar Vivad Samadhan Scheme in Chap.4 of Finance Act (Act 2) of 1998.