TaxTMI 
TaxTMI 
2016 (9) TMI 870
X X X X Extracts X X X X
X X X X Extracts X X X X
....ity in accordance with the provisions of the Act and for which purpose, he is required to issue notice to the dealer so as to determine as to the amount payable at the rate specified in Section 7 of the Act. A notice was issued on 15.12.2012 stating the amount to be paid by the petitioner in terms of Section 7[C] of the Act. The petitioner was informed in the said notice that if the admissible amount is paid, then the petitioner would be eligible for one time settlement and was requested to pay difference amount of 2% tax immediately and may file the application. The petitioner complied with the same and also submitted a representation to the Designated Authority on 13.01.2015. Thereafter, the Designated Authority was required to proceed in accordance with the provisions of the Act to determine the application filed by the petitioner under Section 5 of the Act. 4. However, on a perusal of the impugned proceedings, it is seen that the Designated Authority has gone into the merits of the assessment and in fact confirmed the reasons assigned by the Assessing Officer, forgetting for a moment that the order has to be passed in an application for settlement under the provisions of the A....
X X X X Extracts X X X X
X X X X Extracts X X X X
.... amount payable under section 7 along with the application, the designated authority shall summarily reject the application. (4) The amount determined under sub-section (1) shall be rounded off to the nearest rupee and, for this purpose, where such amount contains a part of a rupee, and, if such part is fifty paise or more, it shall be rounded off to the nearest rupee, and if such part is less than fifty paise, it shall be ignored. 7. Rate applicable in determining amount payable. - The amount payable by the applicant and to be waived shall be determined as follows:- (a) Where it relates to arrears of tax which was assessed on the best of judgment due to non-production of accounts with corresponding arrears of penalty and interest, the application shall pay forty per cent of arrears of tax pending collection on the date of application along with interest calculated at seven and a half per cent per annum thereon and on such payment of tax, the balance of tax and interest and the entire penalty shall be waived. (b) Where it relates to arrears of tax, including any arrears of tax accrued due to non-filing of declaration forms which was in excess of the tax admitted as per the ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....sub-section 2 to Section 6, which states that if the amount paid by the applicant along with application (in terms of Section 7) falls short of not more than 10% of the amount determined under sub-section (1), then and then alone the question of demanding further amount under Section 6(2) would arise. If the applicant failed to fulfill the conditions under sub-section (2) of Section 6, his application stands summarily rejected in terms of sub-section (3) of Section 6. Thus, the Act being a Settlement Act to give reprieve to the dealer/applicant and bring him out of the misery has first thrown the onus on the dealer/applicant and he has a statutory duty to compute the rate applicable in accordance with Section 7 of the Act, by considering all the relevant records. If the dealer/applicant properly computes the amount and remits the same and encloses proof of such payment along with the application under Section 5, the same will be taken for verification and if the designated authority, on going through the relevant records, finds that further amount is payable and if the same fall short of not more than 10% grant relief to the dealer and if not the application stands summarily reject....
X X X X Extracts X X X X
X X X X Extracts X X X X
....ttlement Act was enacted. Without proper verification of the application as per provision Section 6 of the Act, the Designated Authority could not proceed further and the error has occurred from the said stage. In fact, in Cheran's case, the Court pointed out as follows : "28. In my view, the issue to be decided at the first instance is whether these applications were verified as per the provisions of Section 6(1). It is only thereafter the question of considering the further amount payable would arise under Section 6(2). This again is a procedural infirmity, which goes to the root of the matter. The designated authority at the time of verification of the correctness of the particulars in the applications filed by the petitioner, under Section 5(1), is entitled to return the applications for rectification of defects in terms of Rule 3 of the Rules. If this had been done, then the designated authority could have communicated the petitioner/applicant that the rates so determined by the petitioner itself is an erroneous calculation. This could have avoided the entire litigation in the matter. It is true that the statute does not specifically provide for an opportunity of persona....