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2016 (9) TMI 701 - MADRAS HIGH COURT

2016 (9) TMI 701 - MADRAS HIGH COURT - TMI - Reopning of assessment - where the Commission shifted the terminal date for calculation of interest under Section 234B - Held that:- Commission had no jurisdiction to reopen the matter for the purpose of shifting the terminal date. - The observation of the Settlement Commission by extending terminal date upto 25.02.2000, calls for interference. Accordingly, the Writ Petitions are allowed to that extent and the terminal date as fixed by the Commiss .....

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the decision of this Court in the case of R.Vijayalakshmi V. Income Tax Settlement Commission, Chennai, in W.P.Nos.5553 to 5558 of 2008 and therefore, it is submitted that, that part of the order of the Commission requires to be set aside. 3. It is seen that the Revenue filed Special Leave challenging the order of the Settlement Commission. In the instant case, in C.A.Nos.110 114 of 2001 and 5836 5840 of 2000, this is along with the other batch of similar matters were clubbed together and the H .....

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aswala & Ors. Reported in 2002(1) SCC 633 has held that the Settlement Commission in exercise of its powers under Sections 245(D)(4)(6) does not have the power to reduce or waive the interest statutory payable under Section 234-A, 234-B, and 234-C except to the extent of granting relief under CBDT circulars. However, the learned counsel for the revenue points out that there are two circulars issued by the Board under Section 119 of the Income Tax Act, 1961, one dated 2nd May, 1994 F.No.212/4 .....

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to. The appeals are accordingly disposed of. 4. In terms of the above direction of the Hon'ble Supreme Court, all that the Commission was required to see as to whether the two circulars referred therein issued by the Central Board dated 02.05.1994 and 23.05.1996 would be applicable. Thus, in other words, the remand was a limited remand with a specific direction and the Commission cannot proceed beyond the said direction. In terms of the direction, the Commission has considered the matter an .....

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be withdrawn. 2. Interest u/s 234B 1.Interest for the A.Y.s 1990-1995-96 waived to the extent of 75%, 80% 60%, 60%, 60%, 75% and 50% respectively is not covered under the Board's circular and is accordingly withdrawn. Settlement Application No.:13/CHN/64/95-IT & 682/CHN/71/98/IT [W.P.No.5364/2005]: 1. Internet u/s 234A (i) Interest for the A.Y.s 1992-93 to 1993-94 waived to the extent of 80%, and 50% respectively is not covered under the Board's circular and is accordingly withdrawn .....

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sed by the Commission. 6. Thus, to the above extent, the order of the Commission stands confirmed. The petitioners are aggrieved only by the penultimate portion of the order where the Commission shifted the terminal date for calculation of interest under Section 234B of the Income Tax Act, based on the decisions in the case of Hindustan Bulk Carrier (259 ITR 449) and CIT V. Damani Bros. (259 ITR 475), the correctness of such order is being questioned in these writ petitions. 7. The very issue wa .....

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Commission passed under Section 245 shall be conclusive as to the matters stated therein and no matter covered by such order shall, save as otherwise provided in that Chapter, be reopened in any proceeding under the Act or under any other law for the time being in force. The said provision does not confer the power of review on the commission. It is settled legal position that power of review is to be specifically conferred on the authority by the statute and power of review is not inherent wit .....

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o reopen the proceedings. This position held the field till an amendment was inserted under Section 6(b) of Section 245D by Finance Act 2011 with effect from 1.6.2011. Even the said provision is not a power of review. But the phraseology used by the legislation is rectification and such rectification can be done on any mistake apparent from the record. Therefore, such power exercisable under sub Section 6D of Section 245D can be exercised only to rectify a mistake and such mistake should be appa .....

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ion of the Hon'ble Supreme Court in Brij Lal, held that the order passed by the Settlement Commission rectifying its earlier order cannot be sustained and must perish. In the said case, rectification was sought for by the commission on the ground that the order passed by the Commission was contrary to the Board's circular. The Court held that even otherwise, it is an error within the jurisdiction of the Commission and it was not an error which went to the root of its jurisdiction and hel .....

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