RENUKA DATLA Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE petitioner questions the legality of two similar orders passed by the respondent on February 26, 1999, rejecting the declarations filed by the petitioner under the provisions of the Kar Vivad Samadhan Scheme (hereinafter referred to as "the Scheme"), which was introduced by Chapter IV of the Finance Act (Finance (No. 2) Act of 1998), and seeks an order to direct the respondent to "consider" the declarations filed by the petitioner under Section 88 of the said Act on January 30, 1999. Three reasons are given for rejection of the declarations :

(2.) THE declarations relate to the income assessed for the years 1989-90 and 1992-93. The assessments of the petitioners for the aforementioned years were made under Section 143(3) of the Income-tax Act. The assessee-peti-tioner preferred appeals. The Commissioner of Income-tax (Appeals) by his orders dated July 51, 1997, and September 30, 1997, partly allowed the appeals, by giving partial relief in respect of unexplained investment in the co-ownership property of Raju Investments and also setting aside the addition in regard to unexplained investment in shares in one case and gold and jewellery in another case. For giving effect to the appellate order, modification orders were passed on September 30, 1997, and November 17, 1997, recomputing the income. The tax payable thereon was specified at Rs. 4,82,727 and Rs. 6,56,042 respectively. Thereafter, the competent authority granted waiver of interest payable-under Sections 234A, 234B and 234C by his order dated October 31, 1997. In order to give effect to that order, the Assessing Officer passed consequential orders on January 20, 1998. For the year 1989-90, the balance tax payable was shown as Rs. 3,25,401. This tax was paid in full on March 27,1998. For the year 1992-95, the refundable amount was arrived at Rs. 4,65,289. Questioning the order of the appellate authority in not granting full relief on the aforementioned items and upholding the levy of interest, the petitioner preferred appeals to the Income-tax Appellate Tribunal in the meanwhile. The appeals in so far as the interest is concerned, have become infructuous, as it was waived during the pendency of appeal. We are told that the appeals are still pending in the Tribunal, but that has no bearing on the present case inasmuch as the tax on the item disputed in the appeal was paid well before the crucial date, i.e., before the date of filing the declaration as noted above.

(3.) IN the declaration filed for the year 1989-90, the tax arrear on the date of filing the declaration was shown as Rs. 1,26,889 which is also the figure reflected in the fresh assessment order dated December 31, 1998, after excluding the interest under Sections 234A, 234B and 234C. The disputed income relatable to the tax arrear was calculated at Rs, 2,41,693 on which the petitioner offered to pay a tax of Rs. 96,677 under the scheme. Coming to the declaration for the year 1992-93, the tax arrear was shown as Rs. 5,42,174 on the date of making the declaration and the corresponding disputed income was calculated at Rs. 9,68,168. On this, the petitioner offered to pay the tax of Rs. 3,87,267 under the scheme.