TaxTMI 
TaxTMI 
2004 (11) TMI 41
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.... edible oil, etc. For the assessment year 1993-94, an assessment was framed by the Deputy Commissioner of Income-tax, Special Range, Allahabad, vide order dated March 27, 1995. Feeling aggrieved by the said order, the petitioner had preferred an appeal before the Commissioner of Income-tax (Appeals), Allahabad, who vide order dated October 24, 1995, had rejected the appeal and had confirmed the assessment order. Still feeling aggrieved, the petitioner preferred a second appeal before the Income-tax Appellate Tribunal, which was filed on January 31, 1996. It is stated that along with the appeal, the petitioner has also filed an application for condonation of delay. In the meantime, by Chapter IV of the Finance (No. 2) Act of 1998 (hereinafter referred to as "the Act"), the Central Government introduced the Kar Vivad Samadhan Scheme, 1998 (hereinafter referred to as "the Scheme"). The scheme was made applicable to direct taxes as also indirect taxes mentioned therein. Under the scheme, settlement of taxes was provided for under certain circumstances. However, section 95 provided that the scheme shall not apply in certain cases. Sub-clause (c) of clause (i) of section 95 of the Act pr....
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....ally provided that the provisions of the scheme shall not be applicable where no appeal is admitted and pending before the appellate authority. According to him, as the appeal was filed beyond time, the limitation having expired, till such time the application for condonation of delay is allowed, the appeal cannot be treated as pending before the Tribunal. Further, the requirement is that it should have been admitted also. The word "admitted" postulates that the appeal before the Appellate Tribunal should have been filed within time and in accordance with law and, therefore, the Commissioner of Income-tax was justified in rejecting the petitioner's application on the ground that on the date of declaration, no appeal was pending before the Tribunal. He further submitted that under the scheme settlement of tax payable has been provided and the benefit of the scheme can be taken only when the conditions mentioned therein are fulfilled, otherwise not. He also referred to a clarification issued by the Central Board of Direct Taxes in the form of questions and answers in which it has been stated that the appeal should be pending on the date of filing of the declaration and where the appe....
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....pending before the Commissioner on the date of filing declaration;" From a perusal of the aforesaid provision, it would be seen that the scheme would not apply in a case where no appeal is admitted and pending before any appellate authority. The question is as to whether the appeal filed by the petitioner on January 31, 1996, along with the application under section 5 of the Limitation Act for condonation of delay before the Tribunal can be said to be "admitted and pending" before the Tribunal or not. In the case of Smt. Sushila Rani v. CIT [2002] 253 ITR 775; [2002] 2 SCC 697, the apex court has held that the scheme was introduced by the Central Government with a view to collect revenue through direct and indirect taxes by avoiding litigation. Para. 5 of the report is reproduced below: "The Kar Vivad Samadhan Scheme was introduced by the Central Government with a view to collect revenues through direct and indirect taxes by avoiding litigation. In fact the Finance Minister while explaining the object of the Kar Vivad Samadhan Scheme stated as follows ([1998] 231 ITR (St.) 67): 'Litigation has been the bane of both direct and indirect taxes. A lot of energy of the Revenue Depar....
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....he provisions of the scheme. If all the requirements of the scheme are not made, then on principle of equity the court cannot extend the benefit of that scheme. In the case of Hemalatha Gargya [2003] 259 ITR 1, the hon'ble Supreme Court has held that the Voluntary Disclosure Scheme, 1997, has conferred a benefit on those who had not disclosed their income by affording them protection against the possible legal consequences of such non-disclosure under the provisions of the Income-tax Act where the assessee seeks to claim the benefit under the statutory scheme they are bound to comply strictly with the conditions under which the benefit is granted. There is no scope for the application of any equitable considerations when the statutory provisions of the scheme are stated in such a plain language. Thus, from the decisions of the apex court, referred to above, the following principles emerge: (i) The scheme has been brought into force to put an end to the litigation and to recover the tax payable from the taxpayers who had opted for the scheme; (ii) The conditions of the scheme have to be strictly complied with and if a person does not fall under the four corners of the scheme, th....
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....ion of the term, and that it is no less an appeal because it is irregular or incompetent.' These observations were referred to with the approval and adopted by this court in Raja Kulkarni v. State of Bombay [1954] SCR 384. In Promotho Nath Roy v. W. A. Lee, AIR 1921 Cal 415, an order dismissing an application as barred by limitation after rejecting an application under section 5 of the Limitation Act to excuse the delay in presentation was held to be one 'passed on appeal' within the meaning of section 109 of the Civil Procedure Code. On the principles laid down in these decisions, it must be held that an appeal presented out of time is an appeal, and an order dismissing it as time-barred is one passed in appeal." In the case of S. B. Jain [1972] 83 ITR 104, the apex court following its earlier decision in the case of Raja Kulkarni [1954] SCR 384 and Mela Ram and Sons [1956] 29 ITR 607, has held the question whether that proceeding was barred by limitation or not is irrelevant for determining whether under section 297(2)(d)(ii) of the Income-tax Act, 1961, the proceedings were pending or not. Under the said section, actual pendency of a proceeding is required. In the case of She....
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....ed the designated authority by January 31, 1999, i.e., by the date fixed. In the case of Maruti Udyog Ltd. [2001] 124 STC 285, the apex court was considering the question as to what was the meaning of the word "entertained". It has held that the word "entertained" means "admit to consideration". In the case of Gopal Films v. Deputy CIT [1999] 237 ITR 655, the Karnataka High Court has held that where a revision petition is filed beyond time unless the delay is condoned, it cannot be said that the revision is pending. In such a case only when it is admitted by condoning the delay, the revision proceedings can be said to be pending and on condonation of delay by the Commissioner and admission, the pendency, would relate back to the date of filing of the revision petition. In the aforesaid case the revision was filed on January 5, 1999 along with an application for condonation of delay whereas the declaration under the scheme was filed on January 6, 1999. The declaration was rejected by the designated authority, which has been held to be valid by the Karnataka High Court. In the case of Gufic Pharma Ltd. v. J. G. Arora [1999] 238 ITR 835, the Gujarat High Court has held that it is n....
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....evision which is required to be pending under section 95(i)(c) of the Act, should be maintainable or in which the relief could be granted, will be amounting to re-writing the section. In the case of Radhika Prakashan P. Ltd. v. Union of India [2002] 256 ITR 265, the Madhya Pradesh High Court has held that before the appeal filed by the declarant before the Tribunal was dismissed in default for appearance on September 4, 1998, and was restored later on June 1, 1999, and subsequently dismissed on the merits on May 10, 2000, the declaration filed by the assessee under the scheme on January 28,1999, could not have been rejected by the designated authority on the ground that no appeal was pending on the date of filing of declaration as the term "restoration" itself contemplates that original position reverts back. In the case of Shree Amarlal Kirana Stores v. CIT [2003] 259 ITR 572, the Madhya Pradesh High Court has held that in order to take the benefit of the scheme, it is necessary for the assessee to show as a fact that on the date of filing of the declaration under the scheme an appeal or reference or a writ was admitted for final hearing and was pending before any appellate auth....
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.... the Bench for the return of the appeal and the applications, to check whether the appeals are barred by limitation and, if so, intimate the party and place the matter before the Bench for orders. Under clause (vi), the Registrar has been empowered to fix a date of hearing of the appeal and even direct the issue of notice therefor subject to the direction of the President, Senior Vice-President, Vice-President and Senior Member of the Bench. Under rule 12 of the Rules, the Tribunal has been empowered to reject a memorandum of appeal if it is not in the prescribed form or return it for being amended within such time as it may allow. From a reading of the rules, it does appear that there is no provision for admitting the appeal by the Tribunal. The words "admitted and pending" used in section 95(i)(c) of the Act refer to the appeal, reference or writ petition and would be applicable to such appeals where there is a procedure for its admission. In the absence of any procedure for admission, like in the present case before the departmental authority, it cannot be said that the declarant has to fulfil this requirement also in order to avail of the benefit of the scheme. It is well-settl....