South India Corporation Ltd., Cloth Bazar Road, Ernakulam, Rep. by its Wholetime Director, Mr. VR. Veerappan V. Commissioner of Income Tax, Kochi, I.S. Press Road, Ernakulam

OP/13106/1999

AI Insights

The case involves South India Corporation Ltd., which sought to apply for benefits under the Kar Vivad Samadhan Scheme, 1998, for certain income tax disputes from the assessment years 1992-93 to 1994-95. The petitioner argued that the issues were still pending as of their application date, despite the Revenue's communication of a Tribunal decision rejecting the referral of a legal question related to one of the issues. The Revenue contended that the Tribunal had already decided on the questions before the petitioner's application. The High Court found that the issues were not pending at the time of the application, leading to the dismissal of the petition.

• Counselvise Citation: [2008] 140 COUNSELVISE.COM (IT) 810153 (HC-KERALA)
• Appeal Type: Others
• Pronouncement Date: 12-12-2008
• Assessment Year: misc
• Laws Referred To: Finance (No.2) Act, 1998
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: P K R MENON
• Assessee Lawyers: A M SHAFFIQUE; GEORGE GEORGE
• Keywords: Eligibility; Income Tax; Kar Vivad Samadhan Scheme; Pending appeal; Settlement of tax cases
• Section: 88

Judgement Text

" IN THE HIGH COURT OF KERALA AT ERNAKULAM PRESENT : THE HONOURABLE MR. JUSTICE S.SIRI JAGAN FRIDAY, THE 12TH DECEMBER 2008 / 21ST AGRAHAYANA 1930 OP.No. 13106 of 1999(I) ----------------------- PETITIONER(S): --------------- SOUTH INDIA CORPORATION LTD., CLOTH BAZAR ROAD, ERNAKULAM, REP. BY ITS WHOLETIME DIRECTOR, MR.VR.VEERAPPAN. BY ADV. SRI.A.M.SHAFFIQUE SRI.GEORGE K. GEORGE, SC FOR IT RESPONDENT(S): --------------- COMMISSIONER OF INCOME TAX, KOCHI, I.S.PRESS ROAD, ERNAKULAM. ADV. SRI.P.K.R.MENON,SR.COUNSEL, GOI(TAXES) THIS ORIGINAL PETITION HAVING BEEN FINALLY HEARD ON 12.12.2008 THE COURT ON THE SAME DAY DELIVERED THE FOLLOWING: O.P.No. 13106/99. APPENDIX PETITIONER(S)' EXHIBITS P1. COPY OF THE ASSESSMENT ORDER FOR 92-93. P2. COPY OF THE ASSESSMENT ORDER FOR 93-94. P3. COPY OF THE ASSESSMENT ORDER FOR 94-95. P4. COPY OF THE APPELLATE ORDER FOR 92-93. P5. COPY OF THE APPELLATE ORDER FOR 93-94. P6. COPY OF THE APPELLATE ORDER FOR 94-95. P7. COPY OF THE COMMON ORDER OF THE TRIBUNAL FOR 93-94 DTD.30.12.97. P8. COPY OF THE TRIBUNAL ORDER FOR 94-95 DTD.28.4.98. P9. COPY OF THE FINAL ORDER BY THE TRIBUNAL. P10. COPY OF THE ORDER IN R.A.161(COCH)/1998. FOR 1994-95 DTD.20.10.98. P11. COPY OF THE APPLICATION FOR 1992-03 TO 1994-95 IN FORM NO.1A. P12. COPY OF THE CERTIFICATE ISSUED BY THE COMMISSIONER OF INCOME TAX DTD.26.2.99. P13. COPY OF THE LETTER TO THE COMMISSIONER OF INCOME TAX DTD.26.3.99. Sdk+ ///True copy/// P.A. to Judge S.SIRI JAGAN, J. ================== O.P.No. 13106 of 1999 ================== Dated this the 12th day of December, 2008 J U D G M E N T The issue involved in this original petition relates to the eligibility of the petitioner for applying for the benefits under the Kar Vivad Samadhan Scheme, 1998, introduced by the Finance (No.2) Act, 1998. This scheme has been introduced for settlement of pending income tax cases. For becoming eligible for applying under the Scheme, the issue in respect of which the benefit is claimed should be one pending in appeal, revision, reference etc. before any authority or court on the date of application for benefit of the scheme. The assessment years involved are 1992-93 to 1994-95. The appeals filed against the assessment were apparently allowed in favour of the petitioner. The Department filed application for reference of certain questions of law for decision by the High Court. According to the petitioner, five questions of law were sought to be referred for decision of this Court in the reference application submitted by the Revenue. The final decision on the same was still pending with the Tribunal when the Kar Vivad Samadhan Scheme came o.p.13106/99 2 into force. Therefore, by Ext.P11, the petitioner submitted application for benefit of the scheme on 29.1.1999. The petitioner sought benefit in respect of two issues. In respect of one issue, the petitioner was given the benefit. But, by Ext.P12 order, the Revenue rejected the claim under the Scheme in respect of other issue on the ground that that issue was not pending on the relevant date. 2. According to the petitioner, Ext.P12 order to that extent is unsustainable in so far as the order refusing to refer the question of law on the issue at the instance of the Revenue was communicated to the petitioner only on 13.2.1999, ie. after the petitioner submitted Ext.P11 application for benefit of the scheme. Therefore, according to the petitioner, as on the date of application under the Scheme, the issue was still pending consideration. The petitioner challenges Ext.P12 to that extent and seeks the following reliefs: “i) to issue a writ of certiorari quashing Ext.P12 as illegal, arbitrary and unauthorised; and ii) to issue a writ of mandamus directing the respondent to permit settlement under Section 88 of Finance (No.2) Act, 1998 in respect of the disputed income and tax offered by the petitioner under Ext.P11 for the assessment years 1992-93, 1993-94 and 1994-95.” o.p.13106/99 3 3. The learned Standing Counsel for the Revenue opposes the contentions of the petitioner. According to him, the reference applications were heard and the question of law in respect of the issue in question was refused to be referred by the Tribunal to the High Court even before the date of application. Out of the five questions included in the reference applications, only one question was referred, which was not in respect of the issue for which the petitioner sought benefit under the scheme. The draft statement containing only one question was circulated to the parties by the Tribunal much before the application of the petitioner on 29.1.1999, is the contention raised by the counsel for the Revenue. The counsel for the Revenue would, therefore, submit that since at the time of application submitted by the petitioner no issue was pending consideration by any forum, the petitioner is not entitled to the benefit of the scheme. 4. I have considered the rival contentions in detail. 5. The question to be considered is as to whether the issue in question was pending consideration by any forum on the date of application by the petitioner by Ext.P11. On 29.1.1999 if the issue in respect of which the petitioner is claiming benefit of o.p.13106/99 4 the scheme was not pending consideration by any forum, then the petitioner is not entitled to the benefit of the scheme. The contention of the petitioner is that the issue was pending since the refusal by the Tribunal to refer the question of law in respect of that issue was made known to the petitioner only on 13.2.1999. But this contention is belied by the averments of the petitioner in the original petition itself. In paragraph 2 of the original petition the petitioner themselves categorically state thus: “2. .... It may be noticed that the Tribunal had prepared a draft statement dated 30.6.1998 and served the copy of the same on the petitioner on 9.7.1998. Ext.P9 was issued after giving a hearing on 7.8.1998. The reference application filed by the respondent for the assessment year 1994-95 was dismissed by the Tribunal vide order dated 20.10.1998 and a copy of the same was served on the petitioner on 7.11.1998...” That being so, the petitioner himself admits that the copy of the draft statement was received by the petitioner on 9.7.1998 and 7.11.1998 for the assessment years in question. Admittedly, the draft statement did not contain the question of law in respect of the issue for which the petitioner sought benefit of the scheme. It is admitted that the draft statement contains the question of law decided to be referred to the High Court and only corrections can be carried out in the same. Therefore, as on the date of Ext.P11, o.p.13106/99 5 viz., 29.1.1999 no issue was pending consideration for which the petitioner is seeking benefit under the Scheme. That being so, I do not find any merit in the original petition and accordingly, the same is dismissed. Sd/- sdk+ S.SIRI JAGAN, JUDGE ///True copy/// P.A. to Judge o.p.13106/99 6 S.SIRI JAGAN, J. ================ O.P.No. 13106 of 1999-I ================ J U D G M E N T 12th December, 2008 "