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2016 (7) TMI 1505 - HC - Income TaxChallenge of order of settlement commission - Condonation of delay - Partially Waiver of interest chargeable u/s. 234A, 234B and 234C granted by the Settlement Commission in original order - Rectification filed - Rectification of above order was allowed by commission - Assessee challenged before High Court - High Court held that no rectification is permissible in view of decision of Supreme Court in case of Brij Lal and ors [2010 (10) TMI 8 - SUPREME COURT] - department, thereupon, filed the present petitions challenging original order - HELD THAT:- Settlement Commission having accepted substantially the application of the rectification filed by the department in the year 2002, the department had no cause or grievance against the rectified order of the Settlement Commission. Once the Settlement Commission accepted the rectification prayer of the department, there was no order adverse to the department which could have been challenged. It was only by virtue of the High Court judgement dated 03.03.2014 that such order of the rectification came to be set aside thereby reviving the original unrectified order of the Settlement Commission dated 11.08.2000. The very right of the department to challenge the order of Settlement Commission therefore arose after 03.03.2014 by virtue of the judgement of the High Court. Till then, the department had no cause to feel aggrieved by the order of Settlement Commission. If there was no order adverse to the department, the department could not have challenged the same. Soon after the High Court passed the said order dated 03.03.2014, the department filed the present petitions. Looked from such angle, we do not find any delay or laches on part of the department in moving these petitions. Delay, if any, is duly explained. Had the department delayed filing these petitions after the High Court reversed the rectification order of the Settlement Commission by the judgement dated 03.03.2014, we would have certainly considered the opposition of the assessees. We must clarify that to the extent, the Settlement Commission in the order of rectification had turned down the prayers of the department, such issue cannot be re-agitated in the present petitions. In other words, the department not having challenged the order dated 11.10.2002 by which the rectification application of the department came to be partially disallowed, it cannot now reopen the same question after long gap of time in the present petitions, taking cue from the observations made by the High Court in the said judgement dated 03.03.2014. Under the circumstances, we direct modification of the order of Settlement Commission dated 11.08.2000 by reversing the waiver of interest in terms of Settlement Commission's directions contained in its order dated 11.10.2002. We adopt the same directions for modification of the Settlement Commission's original order dated 11.08.2000. It is undisputed position that as held by the Supreme Court in case of Brij Lal and ors vs. Commissioner of Income Tax [2010 (10) TMI 8 - SUPREME COURT] the Settlement Commission could have charged interest only upto the stage of passing order under Section 245D(1) of the Act. If the Settlement Commission had directed levy of such interest post the stage of Section 245D(1) in its order dated 11.08.2000, we clarify that beyond the said stage no interest shall be collected from the assesses.
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