2020 (4) TMI 628 - HC - Income Tax

Court sets aside rejection under Samadhan Scheme, emphasizes timely payment over strict deadline, directs certificate issuance within two months.

S. Gengaraman Versus The Commissioner of Income-tax (Appeals), The Income Tax Officer, Ward I (4) Coimbatore

The Court allowed the writ petition, setting aside the rejection of the declaration under the Samadhan Scheme. The petitioner's compliance with the ... Kar Vivad Samadhan Scheme - Tax arrears - petitioners have not paid the amounts demanded within the specified time limit - HELD THAT:- Under similar circumstances, this Court has passed an order in the case of Sri Balaji Finance v. Income-tax Officer [2010 (9) TMI 498 - MADRAS HIGH COURT] in which it is stated that payment of amount by assessee beyond 30 days but within a reasonable time as per amendment order would satisfy the requirements of Kar Vivad Samadhan Scheme, 1998. Writ petition is allowed and the impugned order is set aside. The first respondent is directed to issue necessary certificate under Section 90(2) of the Finance Act, 1998 to the petitioner, within a period of two months from the date of receipt of a copy of this order. Issues:Challenge to rejection of declaration under Samadhan Scheme.Analysis:The petitioner was assessed to income tax for the years 1992-93 and 1993-94, with tax arrears and interest levied by the Department. The Government introduced a Kar Vivad Samadhan Scheme, under which the petitioner filed declarations to avail benefits. A Certificate of Intimation was issued, determining the total payable amount. Despite making the required payment within the specified time, the petitioner was asked for additional proof and payment, which was also complied with. Subsequently, the declaration was rejected for not paying an additional amount within the specified time limit, leading to the writ petition.The petitioner argued that all requirements of the Scheme were met, and the rejection was unjustified. The additional demand was paid to cooperate with the Department, even though it was not a valid demand. The Court considered the submissions made by the petitioner's counsel and the Government Advocate (Taxes) and referred to a previous judgment where payment made beyond 30 days but within a reasonable time was deemed sufficient to satisfy the Scheme's requirements. The Court emphasized that the payment should be made within a reasonable time or as stipulated in the order itself, rather than a strict 30-day limit.Applying the principles from the previous judgment to the present case, the Court allowed the writ petition, setting aside the impugned order. The first respondent was directed to issue the necessary certificate under Section 90(2) of the Finance Act, 1998 to the petitioner within two months from the date of the order. No costs were awarded, and the connected miscellaneous petition was closed.