M.S. Viswambharan V. The Commissioner of Income Tax, Cochin and The Asst. Commissioner of Income Tax, Investigation Circle I, Trichur

OP/7467/1999

AI Insights

The case revolves around the petitioner's application for settlement of income tax liability for the year 1982-83 under the Kar Vivad Samadhan Scheme of 1998. The dispute arose when the tax authorities adjusted the tax liability of Rs. 87,232 from a refund due for 1984-85, as per Ext.P3 proceedings. The petitioner contended that this adjustment was made without notice and was therefore not binding. However, the court noted that the petitioner had already acknowledged and acted upon the adjustment by settling the balance tax due. The court dismissed the petition, emphasizing that the petitioner could not benefit from the scheme retroactively to obtain a better settlement than what was already agreed upon and acted upon.

• Counselvise Citation: [2008] 140 COUNSELVISE.COM (IT) 793824 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 14-03-2008
• Assessment Year: misc
• Laws Referred To: Income Tax Act, Kar Vivad Samadhan Scheme, 1998
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: P K R MENON; GEORGE K GEORGE
• Assessee Lawyers: K M V PANDALAI
• Keywords: Adjustment; Income Tax Liability; Kar Vivad Samadhan Scheme; Settlement
• Section: 154

Judgement Text

" IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE C.N.RAMACHANDRAN NAIR FRIDAY, THE 14TH MARCH 2008 / 24TH PHALGUNA 1929 OP.No. 7467 of 1999(L) ---------------------- PETITIONER: ------------ M.S. VISWAMBHARAN, METHANATH HOUSE, SOUTH MARADY, MUVATTUPUZHA. BY ADV. SRI.KMV.PANDALAI SMTS.HEMALATHA RESPONDENTS: ------------- 1. THE COMMISSIONER OF INCOME TAX, COCHIN (DESIGNATED AUTHORITY UNDER KAR VIVAD SAMADHAN SCHEME, 1998) 2. THE ASST. COMMISSIONER OF INCOME TAX, INVESTIGATION CIRCLE I, TRICHUR. BY ADV. SRI.P.K.R.MENON,SR.COUNSEL,GOI(TAXES) SRI.GEORGE K. GEORGE, SC FOR IT THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 14/03/2008, THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: 2 ORDER ON CMP 12592 OF 1999 IN OP 7467 OF 1999 DISMISSED 14.3.2008 SD/-C.N.RAMACHANDRAN NAIR, JUDGE. APPENDIX PETITIONER'S EXHIBITS: EXT.P1 TRUE COPY OF THE ASSESSMENT ORDER DATED 5.1.94 PASSED BY THE FIRST RESPONDENT. EXT.P2 TRUE COPY OF THE PROCEEDINGS F.NO. 46003-PN-3538/AC-INV-1 DATED 24.11.95 PASSED BY THE 2ND RESPONDENT. EXT.P3 TRUE COPY OF THE PROCEEDINGS F.NO. 46003-PN-3538/AC.INV-1 DATED 24.11.95 PASSED ;BY THE 2ND RESPONDENT. EXT.P4 TRUE COPY OF THE DECLARATION DATED 30.12.98 BY THE PETITIONER. EXT.P5 TRUE COPY OF THE COMMUNICATION DATED 26.2.999 BY THE FIRST RESPONDENT. EXT.P6 TRUE COPY OF THE NEWS APPEARED IN THE ECONOMIC TIMES DATED 25.12.98 EXT.P7 TRUE COPY OF THE LETTER DATED 8.3.99 SUBMITTED BY THE PETITIONER BEFORE THE FIRST RESPONDENT. RESPONDENTS' EXHIBITS: NIL. TRUE COPY P.S. TO JUDGE. C.N. RAMACHANDRAN NAIR, J. -------------------------------------------- O.P. NO. 7467 OF 1999 -------------------------------------------- Dated this the 14th day of March, 2008 JUDGMENT Heard counsel for the petitioner and senior standing counsel appearing for the respondents. Petitioner applied for settlement of income tax liability for the year 1982-83 under the Kar Vivad Samadhan Scheme of 1998. The proceedings issued vide Ext.P5 show that liability due for 1982-83 was only interest payable under various provisions of the Income tax Act and the petitioner was allowed to settle the liability by paying 50% in terms of the Scheme. However, petitioner's case is that there was balance tax liability for 1982-83 and if that was reckoned petitioner would have been able to settle the liability by paying 30% of the total disputed income to which balance tax is attributable. However, department's case is that tax liability of Rs. 87,232/- got adjusted from refund due for 1984-85 as is evident from Ext.P3 proceedings. Petitioner's counsel contended that adjustment under Section 154 is made without notice to the petitioner and therefore adjustment is not binding on the petitioner. However, it 2 is seen that against Ext.P2 demand for 1982-83 wherein demand of tax alone was Rs. 7,27,925/-, petitioner discharged the liability after reckoning the adjustment made vide Ext.P3. I do not think petitioner is entitled to challenge Ext.P3 proceedings after acting upon the same by making payments of balance amount due merely because the Kar Vivad Samadhan Scheme would have resulted in better benefit to the petitioner, had the adjustment not been made by the assessing officer. Petitioner having discharged the balance tax liability after reckoning the adjustment made vide Ext.P3 cannot request for reversal of the adjustment after three years of the order. O.P. therefore fails and is dismissed. (C.N. RAMACHANDRAN NAIR) Judge kk 3 "