Kar Vivad Samadhan Scheme settlement certificate withdraws pending appeal and bars further adjudication of covered tax arrears.

Issuance of a settlement certificate under the Kar Vivad Samadhan Scheme on payment of the amount determined by the designated authority triggers statutory withdrawal of any pending appeal relating to the declared tax arrears. Where the appeal or reference was pending, it is deemed withdrawn from the date of the order under Section 90(2), and Section 92 bars the appellate authority from deciding any issue covered by the declaration and settlement order. Once the certificate of full and final settlement was placed before the Tribunal, the dispute could not be adjudicated further and had to be treated as withdrawn by operation of the scheme.

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Issues: Whether the pending appeal stood withdrawn and the Tribunal was barred from deciding the dispute once the designated authority under the Kar Vivad Samadhan Scheme issued a certificate certifying full and final settlement of the declared tax arrears.

Analysis: The statutory scheme under Section 90(2) contemplates issuance of a certificate on payment of the amount determined by the designated authority. Section 90(4) provides that where an appeal or reference giving rise to tax arrears is pending, it shall be deemed to have been withdrawn on the date of the order passed under sub-section (2). Section 92 further bars the Appellate Authority from proceeding to decide any issue relating to the disputed amount covered by such declaration and order. Since the certificate of settlement was placed before the Tribunal, the statutory consequences followed and the dispute could not be adjudicated further.

Conclusion: The appeal was liable to be treated as withdrawn by operation of the scheme, and the Tribunal could not proceed to decide the merits of the dispute.

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