2014 (8) TMI 1152

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....s issued to the petitioners for the assessment years 1991-92, 1992-93, 1993-94 and 1994-95 and, during its pendency, the petitioners approached the Settlement Commission by filing a settlement application under Section 245C (1) of the Act on 23.03.1998. It transpires that the Settlement Commission passed an order under Section 245D (1) of the Act on 24.03.1999. Since this order contained certain errors, the same was recalled which led to various litigations. Through various orders passed by the writ Court, the proceedings before the Settlement Commission was stayed and eventually, the Settlement Commission passed a fresh order under Section 245D (4) of the Act on 27.03.2012. Based on the said order, a demand notice under Section 156 of t....

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....ettlement Commission we find that the request of the petitioners for waiving the interest under Sections 234A, 234B and 234C was not accepted and the Settlement Commission directed that interest under Sections 234A and 234C, wherever applicable was to be charged as per law and interest chargeable under Section 234B would be charged upto the date of order passed under Section 245D(1) and that interest under Section 220(2), applicable on the sustained demand outstanding as on various dates would be charged upto the date of the order passed by the Settlement Commission. In the light of the said direction of the Settlement Commission, the notice of demand under Section 156 of the Act was issued. We also find that the rectification applicatio....

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....tion of scheme as provided under section 245D of the Act, the Supreme court held that the Settlement Commission has to settle the dispute in accordance with the provisions of the Income-tax Act and the expression "terms" used in sub-section (6) does not refer to the power of the Commission to waive or reduce the tax, penalty etc. The Supreme Court held: "...........Therefore, all that the expression 'term' in section 245D(6) means is that the Commission can stipulate the conditions of payment like instalments, last date for payment etc. Beyond that, in our opinion, subsection (6) does not authorise the waiver or reduction of tax, penalty or interest settled under sub-section (4) of section 245D" In the light of the afore....