TMI Blog2002 (2) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... e Income-tax Settlement Commission constituted by the Chairman in exercise of his powers under section 245BA(5A) of the Income-tax Act, 1961 (hereinafter referred to as "the Act"). The reference to the Special Bench was in respect of the following questions: "1. Was the Special Bench of the Settlement Commission right in holding in the case of Om Metals and Minerals (Pvt.) Ltd., In re [1992] 193 ITR 57 (ITSC) (New Delhi) that the assessment order passed by the Assessing Officer before the admission of the settlement application subsisted and recovery proceedings continued even after the admission of the said application, especially after the judgment of the Supreme Court in the case of CIT v. Express Newspapers Ltd. [1994] 206 ITR 443? (The court, inter alia, made the following observation: It is equally evident that once an application made under section 245C is admitted for consideration, (after giving notice to, and considering the report of the Commissioner of Income-tax as provided by section 245D), the Commission shall have to withdraw the case relating to that assessment year (or years, as the case may be) from the assessing/appellate/ revising authority and deal with ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Commission's order under section 245D(4). The order of assessment stands modified to give effect to the order under section 245D(4) by the theory of merger applying to such order. (ii) In cases where assessment orders were passed before the filing of the application, the liability of interest under section 220(2), if any, will be up to the date of order under section 245D(1). There will be no liability for interest under section 220(2) thereafter. In cases where assessment orders were passed after the filing of the application, there will be no liability of interest under section 220(2). Question No. 3 Yes. The Commission has the power to reduce/waive interest chargeable under section 220(2)". Aggrieved, the Revenue has come up in appeal to this court. S. L. P. (C) Nos. 18012-18015 of 2000: The above special leave petitions have been filed against the order dated September 20, 1999, passed by the Income-tax Settlement Commission (IT WT), Additional Bench, Calcutta. The said order came to be passed on the applications seeking for rectification of the earlier order dated February 16, 1999, placing reliance upon the decision of the Settlement Commission, Special Ben ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd set aside, revoked or cancelled, on behalf of the assessee, a contrary position and stand has been asserted with equal vehemence. Both parties sought to place strong reliance upon the earlier decision of this court in CIT v. Express Newspapers Ltd. [1994] 206 ITR 443. We have carefully considered the matter in the light of the relevant provisions of the Act and decisions to which a reference will be made hereafter. The decision in Express Newspapers Ltd.'s case [1994] 206 ITR 443 (SC), has been rendered by a Bench of three learned judges. That was a case wherein a question of the nature now sought to be raised was not directly in issue or under detailed consideration and the judgment also specifically clarifies that the order therein was confined only to the question of jurisdiction of the Settlement Commission and the validity of its order taking seisin of the case. On the conclusion arrived at that the application filed before the Settlement Commission in that case was not in compliance with the first and foremost requirement of section 245C(1) the very application was held to be not maintainable and ought to have been rejected in limine. In the course of dealing with the s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or the proper disposal of the case pending before it". It was also observed therein as follows: "There are two other limitations upon this power, viz., that this reopening of the completed proceedings can be done, even for the aforesaid limited purpose, only with the concurrence of the assessee and secondly that this power cannot extend to a period beyond eight years from the end of the assessment year to which such proceeding relates. These two features make it abundantly clear that the section contemplates reopening of the completed proceedings not for the benefit of the assessee but in the interests of the Revenue. it contemplates a situation where the case before the Commission cannot be satisfactorily settled unless some previously concluded proceedings are reopened which would normally be to the prejudice of the assessee. It is precisely for this reason that the section says that it can be done only with the concurrence of the assessee and that too for a period within eight years. This section cannot be read as empowering the Commission to do indirectly what cannot be done directly." At page 631 of the Report, it is further observed as follows: "Lastly, we may refer ..... X X X X Extracts X X X X X X X X Extracts X X X X
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