TMI Blog2002 (4) TMI 17X X X X Extracts X X X X X X X X Extracts X X X X ..... e (No.2) Act, 1998, is entitled to the benefit of the "Kar Vivad Samadhan Scheme, 1998" and, therefore, the impugned communications issued by the respondents, are quashed and set aside. - - - - - Dated:- 2-4-2002 - Judge(s) : J. N. PATEL., P. S. BRAHME. JUDGMENT The judgment of the court was delivered by J.N. PATEL J.-The petitioner-assessee has approached this court invoking its extraordinary jurisdiction to quash and set aside the communications dated August 10, 1999 (annexure No.4), and September 1, 1999 (annexure No. 6), and for seeking declaration that the petitioner has made payment in time and is entitled to the benefit of the "Kar Vivad Samadhan Scheme, 1998", and for directions to the respondents to issue necessary certif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r dated January 7/8, 1999, in Form No. 2B of the "Kar Vivad Samadhan Scheme, 1998" and the assessee who was the declarant seeking benefit under the Scheme, was directed to make payment of the same within 30 days from the date of the said certificate. The said certificate was received by the assessee on January 13, 1999, pursuant to which the assessee made payment of the said amount by cheque drawn on Parmatma Ek Sevak Nagarik Sahakari Bank Ltd., Nagpur, dated February 10, 1999, in the sum of Rs. 2,11,021 in favour of the Revenue through the State Bank of India, Chhaoni Branch. Against the said payment, the account of the assessee came to be debited as the assessee's bank cleared the payment on February 12, 1999, but the same was credited in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... madhan Scheme, 1998", the respondents are proceeding further in the matter, therefore, the impugned communication deserves to be quashed and set aside and the assessee be declared as entitled to the benefit of the "Kar Vivad Samadhan Scheme, 1998". It is the contention of Mr. Bhangade, that it is a settled law that if the cheque is honoured the payment under the said cheque relates back to the date of deposit of the said cheque. Thus, it is clear that the petitioner has made the payment on the 30th day to be reckoned from January 13, 1999, the date of receipt of the order dated January 13, 1999. It is further submitted that even if it is accepted that there is a delay of one day, the same can be condoned as the said delay is due to the circ ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ne the communication dated August 10, 1999, which is annexure No.4, under which the respondents communicated to the petitioner that the benefit of the "Kar Vivad Samadhan Scheme, 1998" cannot be extended to them because they had paid the amount on February 13, 1999, i.e., on the 31st day which is beyond 30 days time limit. Therefore, the facts are not much in dispute. The certificate of intimation was received by the assessee on January 13, 1999, pursuant to which the assessee made payment of the amount demanded under the certificate by cheque dated February 10, 1999. The said cheque was cleared on February 13, 1999. A cheque is a bill of exchange drawn on a banker and payable on demand and a common way of paying a debt. It is not in disp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... material is when the cheque was given and the payment is made when the cheque was given and not when the cheque was cashed at the instance of the creditor. Consequently, even when a cheque is accepted by the creditor as conditional payment, the preference by the creditor of accepting a cheque rather than cash, operates as a payment to the creditor when the cheque is given although the liability of the debtor may revive in the event of the cheque not being ultimately cashed. In another case, i.e., in CIT v. Ogale Glass Works Ltd. [1954] 25 ITR 529; AIR 1954 SC 429, the Supreme Court said: "The position, therefore, is that in one view of the matter there was, in the circumstances of this case, an implied agreement under which the cheques ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ce Act that the declarant has to pay the tax within three months from the date of filing the declaration and relying upon the circular dated September 3, 1998, issued by the Central Board of Direct Taxes and more particularly clauses II and IV of the said circular. It was submitted that the assessee ought to have deposited the amount of tax within 90 days and the cheque deposited by the assessee ought to have encashed within 90 days from the date of said declaration and the cheque was encashed beyond the prescribed period. The assessee was held not to be entitled for a certificate under section 68(2) of the Finance Act 1997. The High Court held that the petitioner has been wrongly denied the certificate under the provisions of section 68(2) ..... X X X X Extracts X X X X X X X X Extracts X X X X
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