Kar Vivad Samadhan Scheme settlement bars section 154 rectification of a demand already conclusively resolved.

A settlement under the Kar Vivad Samadhan Scheme becomes conclusive once the declaration is accepted, the amount determined under section 90 is paid, and the certificate is issued toward full and final settlement of the covered tax arrears. The scheme bars reopening the settled arrears in other proceedings, so the Assessing Officer could not use section 154 to rectify the assessment and withdraw depreciation after such settlement. The attempted rectification to revise a demand already covered by the scheme was therefore without jurisdiction and could not be sustained.

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Issues: Whether the Assessing Officer could invoke section 154 to rectify the assessment and withdraw depreciation after the tax arrears had been settled under the Kar Vivad Samadhan Scheme.

Analysis: The declaration under the Scheme was accepted by the designated authority, the amount determined under section 90 was paid, and the certificate was issued towards full and final settlement of the covered tax arrears. The Scheme makes the determination under section 90 conclusive as to the matters stated therein, and the settled tax arrears cannot be reopened in other proceedings. In these circumstances, a subsequent rectification by the Assessing Officer to revise the very demand already settled under the Scheme was not permissible.

Conclusion: The rectification under section 154 was without jurisdiction and could not be sustained; the assessee succeeds.

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