Tax Law Amendment Challenges Section 245C(5), Extends Interim Board Application Deadline to March 31, 2021

HC ruled on tax law amendments, finding Section 245C(5) overbroad. Court extended interim board application deadline from 1 Feb to 31 Mar 2021, invalidating prior rejections. Pending applications must be reconsidered on merits. Settlement Commissioner directed to comply with ruling. Writ petitions disposed without costs.

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The Madras High Court, through the Hon'ble Chief Justice Sanjay V. Gangapurwala and Justice D. Bharatha Chakravarthy, addressed writ petitions challenging amendments made by the Finance Act, 2021 to various provisions of the Income Tax Act, including Sections 245A, 245B, 245BC, 245BD, 245C, 245D, 245DD, 245F, 245G, 245H, and the insertion of new Sections 245AA and 245M. The petitioners sought declarations that these amendments were "arbitrary, illegal and void," and also sought to quash an order dated 24.11.2023.Relying on precedent from *M/s. Jain Metal Rolling Mills v. Union of India* (W.P.Nos.13455 of 2021, dated 17.11.2023), the Court read down Section 245C(5) by removing the retrospective deadline of 1 February 2021 and extending it to 31 March 2021. The Court held that applications pending between 1 February and 31 March 2021 shall be deemed pending for consideration by the Interim Board. Any rejections based solely on the absence of a pending case as of 31 January 2021 were set aside, and such applications must be reconsidered on their merits.Accordingly, the Settlement Commissioner was directed to pass orders consistent with this ruling. The impugned orders were set aside, the writ petitions disposed of, and no costs were awarded. Related miscellaneous petitions were closed.

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