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M/s. Tigrania Steel Corporation Versus The Commissioner of Income Tax & Others

2016 (10) TMI 774 - BOMBAY HIGH COURT

Withdrawal of relief in levy of penalty - rectification of order u/s 154 - relief of 50% of penalty under Section 271(1)(c) - scope of Section 273A(1) as well as 273A(4) - availing benefit of KVSS - Held that:- As clarified by the Circular dated 7th October, 1998 issued under Section 96 of Samadhan Scheme, a mere initiation of criminal proceedings would by itself not be a bar, if the assessee concerned has been discharged. The only exclusion is of pending proceedings for conviction or conviction .....

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. In terms of Section 90 of the Finance No.2 Act, the designated Authority is required to dispose of an application under the Samadhan Scheme within 60 days from the date of its receipt. - Decided partly in favor of assessee. - Writ Petition No. 2326 of 1999 - Dated:- 30-9-2016 - M. S. Sanklecha And S. C. Gupte, JJ. Mr. P.J. Pardiwala, Senior Counsel a/w Mr. K.B. Bhujle for the petitioner Mr. A.R. Malhotra for the respondents ORDER P. C. 1. This petition under Article 226 of the Constitution of .....

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999. However, interim relief was refused. 3. Today, at the final hearing, the petitioner is only pressing for relief in respect of the order dated 30th November, 1998 passed by the Designated Authority under Samadhan Scheme. The Finance No.2 Act, 1998, in Chapter IV thereof from Section 86 to Section 98 therein, introduced the Samadhan Scheme. 4. Briefly, the facts relevant to the challenge to the order dated 30th November, 1998 are as under : (a) Assessment order dated 28th September, 1999 for .....

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was imposed. (c) Thereafter, in 1996, the petitioner made application to Commissioner of Income Tax for waiver of penalty imposed by order dated 17th December, 1990 under Section 273A(1) as well as 273A(4) of the Act. (d) The petitioner's application for waiver under Section 273A(1) of the Act was rejected by order dated 26th March, 1996. However, by order dated 11th March, 1997, the Chief Commissioner of Income Tax granted his approval to 50% waiver of penalty imposed. This was communicated .....

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king a false statement of Income to the extent of ₹ 16.25 lakhs before the Additional Chief Metropolitan Magistrate. (f) However, as the penalty imposed under Section 271(1)(c) of the Act had been reduced by 50% by order dated 21st March, 1997, the petitioner filed an application for discharge before the Additional Chief Metropolitan Magistrate. On 19th June, 1997, the Metropolitan Magistrate passed an order discharging the petitioner and its partners from the prosecution in Case No. 178 o .....

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7 of the Additional Chief Metropolitan Magistrate. (g) On 14th September, 1998, the petitioner filed a declaration under the Samadhan Scheme, seeking to settle the outstanding penalty and interest payable aggregating to ₹ 2.12 lakhs. (h) By the impugned order dated 30th November, 1998, the Designated Authority rejected the petitioner's declaration dated 14th September, 1998. This on the ground that the prosecution for concealment of income had already been instituted before the date of .....

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amadhan Scheme would be valid for the purpose of being entertained, was negatived. This by holding that the impugned order dated 19th June, 1997 of the Additional Chief Metropolitan Magistrate discharging the petitioner is not final, for the reason that a Criminal Revision Petition has been filed by the Revenue before the High Court and the same was at the relevant time awaiting admission. In the above view, the Designated Authority rejected the petitioner's declaration made in terms of the .....

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r, to any tax arrears in respect of a person of such assessment year under such direct tax enactment or in respect a person who has been convicted for concealment on or before the date of filing the declaration. (b) & (c) ….. (ii) (iii) (iv) & (v) ….. Extract of Circular dated 7 th October, 1998 : Question No.33 :Where prosecution has been launched for any particular year but the assessee has since been discharged by the competent Court, can the declaration be made under th .....

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that the direction does not contemplate a situation of the Revenue taking up the issue of discharge of an accused assessee by a Criminal Court in Revision Petition before a superior forum. In any case, it is further submitted that on the plain reading of the directions given by the Central Board of Direct Taxes, dated 7th October, 1998 under Section 96 of Samadhan Scheme as the petitioner had been discharged by a Criminal Court prior to its making an application for settlement under the Samadha .....

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sdiction. 8. We find merit in the submission made on behalf of the petitioner. As clarified by the Circular dated 7th October, 1998 issued under Section 96 of Samadhan Scheme, a mere initiation of criminal proceedings would by itself not be a bar, if the assessee concerned has been discharged. The only exclusion is of pending proceedings for conviction or conviction prior to filing of the declaration. The Circular dated 7th October, 1998 clarifies that where an assessee has been discharged befor .....

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