The Petitioners Rely On The Decision Of This Court In Lukkose John Thoppial v. In View Of The Above Said Decisions, It Is Settled Law That What Is Relevant For The Purpose Of The Scheme Is Pendency Of The Revisions As On The Date Of Decl

IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN MONDAY, THE 5TH MARCH 2007 / 14TH PHALGUNA 1928 OP.No. 9193 of 1999(T) ---------------------------- PETITIONER: ------------------- E.N.MURALI, 19/284, ELAVANTHIKKAL HOUSE P.O. CHALAPPURAM, CALICUT. BY ADV. SRI.PGK.WARRIER SRI.K.S.MENON SRI.P.BALAKRISHNAN RESPONDENTS: ---------------------- COMMISSIONER OF INCOME -TAXCALICUT. BY ADV. SRI.P.K.RAVINDRANATHA MENON (SR.) SRI.GEORGE K. GEORGE THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 05/03/2007, ALONG WITH OP NO. 9213 OF 1999 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: 5.3.2007 ORDER ON CMP. NO.15293/1999 IN OP.9193/1999 DISMISSED SD/- S.SIRI JAGAN, JUDGE APPENDIX PETITIONER'S EXHIBITS EXT.P1:- COPY OF THE DECLARATION UNDER THE KVS SCHEME FILED BYPETITIONER FOR THE A.YS 1988-89 & 1993-94. EXT.P2:- -DO- -DO- FOR THE ASSESSMENT YEAR 1989-90 , 1990-01 AND 1991-1992. EXT.P3:- -DO- -DO- FOR THE ASSESSMENT YEAR 1992-93 AND 1994-95. EXT.P4:- COPY OF THE ORDER OF THE RESPONDENT DT.17.11.98 UNDER SECTION 264OF THE INCOME TAX ACT,1961. EXT.P5:- COPY OF THE ORDER OF THE RESPONDENT DT.18.11.98 REGARDING EXTS.P1TO P3. tss /TRUE COPY/ S. SIRI JAGAN, J. -------------------------- O.P.NO. 9193/99 &O.P.NO.9213 OF 1999 ------------------------- DATED THIS THE 5[th] DAY OF MARCH, 2007 JUDGMENT The issues involved in these two original petitions are identicaland therefore these original petitions are being disposed of by thiscommon judgment. 2.The matter relates to the claims of the petitioners underthe Kar Vivad Samadhan Scheme 1998 declared by the Finance ActNo.2/98 passed by the Parliament. Under the said scheme assesseesintending to avail of the benefits of the said scheme had to file adeclaration between 1[st] September 1998 and 31[st] December 1998. (Itwas stated at the bar that this period was extended for a period of onemonth, which is not relevant for the purposes of this case.) Forbecoming entitled to the benefits of the scheme, inter alia, the amountin dispute must be in arrears and an appeal or reference or writpetition in respect of the same must have been admitted and pendingbefore any appellate authority or the High Court or the Supreme Courton the date of filing of the declaration. 3.The petitioners in both original petitions had filed the O.P.Nos.9193.99 & 9213/99 revision petitions in respect of the amount in dispute for threeassessment years on 31.8.1998. They filed declaration under thescheme on 14.10.98. It is admitted by both sides that the amountin dispute was in arrears as on the date of declaration. Thus as onthe date of filing of declarations they were prima facie entitled toget their claim under the Kar Vivad Samadhan Scheme 1998considered in accordance with the scheme. But before consideringthe declarations for the benefits under the scheme, the respondenttook up the revision petitions for hearing and dismissed the sameon 17.11.98 by Ext.P4 order (in both original petitions). Thereafterthe declarations of the petitioners were took up by the respondentfor consideration and by Ext.P5 order dated 18.11.1998 (in bothoriginal petitions) rejected the petitioners' claim under the schemeon the ground that no appeal, reference writ or any valid revisionpetition is pending in respect of the petitioners' case and thereforethe scheme has no application to the petitioners' case. Thepetitioners are challenging Ext.P4 and P5 orders ( in both cases) inthese original petitions. 4.The petitioners rely on the decision of this Court inLukkose John Thoppial Vs. Commissioner of Income Tax (242ITR (1)) and the decision of the Division Bench in appeal againstthat decision in Commissioner of Income Tax Vs.(1) Mrs.Leelamma John Thoppil(W.A.NO.106 of 2000)(2) LukkoseJohn Thoppil (W.A.No.233 of 2000) (267 ITR 289) as also the O.P.Nos.9193.99 & 9213/99 4.The petitioners rely on the decision of this Court inLukkose John Thoppial Vs. Commissioner of Income Tax (242ITR (1)) and the decision of the Division Bench in appeal againstthat decision in Commissioner of Income Tax Vs.(1) Mrs.Leelamma John Thoppil(W.A.NO.106 of 2000)(2) LukkoseJohn Thoppil (W.A.No.233 of 2000) (267 ITR 289) as also the O.P.Nos.9193.99 & 9213/99 judgment of the Supreme Court in Dr. Mrs. Renuka Datla andothers Vs. Commissioner of Income Tax and another (259ITR 258 SC). On the basis of the ratio of those decisions, thecounsel for the petitioners would contend that what is relevant forthe purpose of the Kar Vivad Samadhan Scheme 1998 is pendencyof a revision as on the date of filing declaration and not as on thedate of consideration of the declaration for benefit under the KarVivad Samadhan Scheme by the authority competent to pass ordersunder the Scheme. 5.In view of the above said decisions, it is settled law thatwhat is relevant for the purpose of the scheme is pendency of therevisions as on the date of declaration made by the petitionersunder the scheme. Admittedly, the declarations were made on14.10.98 and the revisions were pending at that time, the samehaving been filed on 27.8.98. That being so, the fact that therevisions were later dismissed on 17.11.98 and the respondent whohimself was the authority to pass orders under the scheme and therevisional authority, took up the declaration for consideration forgranting benefit under the Kar Vivad Samadhan scheme only on18.11.98, i.e., after dismissing the revisions of the petitioners, is noground for rejecting the claim of the petitioners under the scheme. 6.Learned standing counsel for the Income TaxDepartment also couldn't dispute this factual position as also thelegal preposition as laid down in the above said decision. Further Section 92 of the Finance Act No.2 of 98 reads as under:- “Appellate authority not to proceed incertain cases.- No appellate authority shallproceed to decide any issue relating to thedisputed chargeable expenditure, disputedchargeable interest, disputed income, disputedwealth, disputed value of gift or tax arrearspecified in the declaration and in respect ofwhich an order had been made under section 90by the designated authority or the payment ofthe sum determined under that section: Provided that in case an appeal is filed by aDepartment of the Central Government inrespect of such issue relating to the disputedchargeable expenditure, disputed chargeableinterest, disputed income, disputed wealth,disputed value of gift or tax arrear (except wherethe tax arrear comprise only penalty, fine orinterest), the appellate authority shall decide theappeal irrespective of such declaration.” 7.In view of this Section since the petitioners had fileddeclarations on 14.10.98 the respondent was not empowered toproceed with the revisions in respect of the disputed amounts andthe respondent ought to have considered the declarations of thepetitioners for benefits under the scheme, first. He having failed todo so both Exts.P4 and P5 orders (in both original petitions) are badin law and liable to be set aside. I do so. Consequently therespondent is liable to reconsider the declarations of the petitionersin accordance with the Kar Vivad Samadhan Scheme,1998. Therefore both the matters are remanded to the respondentfor fresh consideration of the declarations filed by the petitioners on14.10.98 in accordance with the Kar Vivad Samadhan Scheme 1998 O.P.Nos.9193.99 & 9213/99 7.In view of this Section since the petitioners had fileddeclarations on 14.10.98 the respondent was not empowered toproceed with the revisions in respect of the disputed amounts andthe respondent ought to have considered the declarations of thepetitioners for benefits under the scheme, first. He having failed todo so both Exts.P4 and P5 orders (in both original petitions) are badin law and liable to be set aside. I do so. Consequently therespondent is liable to reconsider the declarations of the petitionersin accordance with the Kar Vivad Samadhan Scheme,1998. Therefore both the matters are remanded to the respondentfor fresh consideration of the declarations filed by the petitioners on14.10.98 in accordance with the Kar Vivad Samadhan Scheme 1998 O.P.Nos.9193.99 & 9213/99 afresh. The respondent shall consider the same and passappropriate orders as contemplated under the Scheme asexpeditiously as possible, at any rate within three months from thedate of receipt of a copy of this judgment. If the decision of therespondent on the declaration is in favour of the petitioners therevision petitions shall be disposed of in terms of that decision. Ifthe same is against the petitioners, the revision petitions shall beheard and disposed of afresh on merits. Original petitions are allowed as above. S. SIRI JAGAN, JUDGE Acd