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TMI Blog2023 (6) TMI 674X X X X Extracts X X X X X X X X Extracts X X X X ..... titioner for the Assessment Year 1992-1993. According to petitioner, despite repeated request to provide the reasons to believe, petitioner was not provided the same. The same, however, is annexed to the affidavit in reply filed by respondent no. 1. 4. Petitioner had, on 1st January 1993, filed its return of income for the Assessment Year 1992-1993. During the course of assessment proceedings, respondent no. 1 called for voluminous and comprehensive details and raised queries on various issues, one of which was relating to the amount assessable in the hands of petitioner in respect of its Portfolio Management Scheme (PMS) including transactions in units and transactions with Public Sector undertakings. All requisitions and queries of respondent no. 1 were fully complied with and answered by petitioner. In addition to obtaining detailed information from petitioner, respondent no. 1, for the purposes of making the assessment, even exercised his powers under Section 133(6) of the Act to call for information from third parties and also directed a special audit under Section 142(2A) of the Act. Respondent no. 1 also raised queries based on certain observations in the reports of the Jan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hat though it had very good chance of success in the appeals filed by petitioner, in order to settle all issues finally pertaining to the Assessment Year 1992-1993 and to put an end to all controversies, disputes and litigation, petitioner decided to take advantage of the KVSS. Accordingly petitioner, as per the requirements of the KVSS, on 6th November 1998 filed a declaration in prescribed Form 1A under Section 89 read with Section 88 of the Finance Act. 8. The office of respondent no. 2, in response to petitioner's declaration, determined the amount payable at Rs. 14.18 Crores, which was reduced to Rs. 9,83,65,400/-. Respondent no. 2, by an order dated 18th December 1998 issued under Section 90(1) of the Finance Act, certified, by issuing Form 2A, the amount payable by petitioner pursuant to the declaration at Rs. 9,83,65,400/-. Respondent no. 2 subsequently issued a fresh certificate dated 7th January 1999 in Form 2A redetermining the amount payable at Rs. 10,30,20,815/-. According to petitioner, though respondent no. 2 did not have the power to issue such a revised Form 2A certificate, to put an end to all its proceedings for Assessment Year 1992- 1993 and since the differenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It was not open to the Income Tax Authorities to put back the clock by going back thereupon; (c) the order of the Designated Authority is conclusive on all items/heads which go into the computation of the total income of the assessee and not confined only to the heads of income in respect of which an appeal or reference may be pending; (d) once the payment has been made by the assessee of the sum determined by the Designated Authority and order by the Designated Authority has been passed, it shall be conclusive as to the matters stated therein and no matter covered by such order shall be reopened in any other proceeding under the direct tax enactment or indirect tax enactment or under any other law for the time being in force. Therefore, petitioner having paid the amount as determined by the Designated Authority and Form 3 has been issued under Section 90 of the Finance Act, the notice impugned in the petition could not have been issued. This has been so held in Killick Nixon Ltd. V/s. Deputy Commissioner of Income Tax, Mumbai and Ors. (2003) 1 SCC 145. (e) infact under Section 91 of the Finance Act, there is even immunity from prosecution and imposition of penalty; (f) ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e Form 3 issued. 15. As regards the case of Killick Nixon Ltd. (Supra), which was a similar case, the Apex Court has held that once the Designated Authority has issued the order under Section 90, it will be conclusive in respect of tax arrears and sums payable after such determination towards full and final settlement of tax arrears. Once the declarant makes payment of the amount so determined under Section 90, the immunity under Section 91 springs into effect. The Apex Court has also expressed a view that upon such declaration being made, tax arrears being determined, paid and certificate issued under the KVSS, there is no jurisdiction for the Assessing Officer to reopen the assessment by a notice under Section 143 of the Act, except where the case falls under the proviso (2) of sub-section (1) of Section 90 where it is found that any material particular furnished in the declaration is found to be false. Paragraphs 5 to 10 and 19 read as under : 5. Pursuant to the order of the CIT (Appeal), the Assessing Officer made an order dated 25.9.1998 giving effect to the appellate order. The Assessing Officer determined the assessed income of the appellant at Rs. 33,65,298.00 and raised ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... In this Scheme, unless the context otherwise requires - xxx xxx xxx (e) "disputed income", in relation to an assessment year means the whole or so much of the total income as is relatable to the disputed tax; (f) "disputed tax" means the total tax determined and payable in respect of an assessment year under any direct tax enactment but which remains unpaid as on the date of making the declaration under Section 88; xxx xxx xxx (m) "tax arrear" means - (1) in relation to direct tax enactment, the amount of tax penalty or interest determined on or before the 31st day of Mach, 1998 under that enactment in respect of an assessment year as modified in consequence of giving effect to an appellate order but remaining unpaid on the date of declaration; xxx xxx xxx Section 88 - "Subject to the provisions of this Scheme, where any person makes, On or after the 1st day of September, 1998 but on or before the 31st day of December, 1998, a declaration to the designated authority in accordance with the provisions of Section 89 in respect of tax arrear, then, notwithstanding anything contained in any direct tax enactment or indirect tax enactment or any other provision fo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the total income of the assessee and not confined only to the heads of income in respect of which an appeal or reference may be pending. xxx xxx xxx 19. As far as the provisions of KVSS are concerned, we agree with the contention of the learned Senior Counsel for the assessee that the order to be made by the Designated Authority under Section 90 is a considered order which is intended to be conclusive in respect of tax arrears and sums payable after such determination towards full and final settlement of tax arrears. Once the declarant makes payment of the amount so determined under Section 90, the immunity under Section 91 springs into effect. We are also of the view that upon such declaration being made, tax arrears being determined, paid and certificate issued under the KVSS, there is no jurisdiction for the Assessing Officer to reopen the assessment by a notice under Section 143 of the Act except where the case falls under the provisio (2) of sub-section (1) of Section 90 as it is found that any material particular furnished in the declaration is found to be false. In the present case, it is not the case of the Revenue that any material particular furnished by the appe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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