Hon'ble Bala Krishna Narayana,J.
(Dictated by Hon.Rajes Kumar J.) This is an appeal under Section 260-A of the Income Tax Act (hereinafter referred to as the 'Act' ) filed by the Commissioner of Income Tax Kanpur against the order of Tribunal dated 25.2.2005 for the assessment year 93-94..
The brief facts of the case are that the assessee is a partnership firm and was carrying on lottery business. There was a search and seizure operation on 17.10.1994 , the assessee filed a return of income disclosing the income of Rs.18,17,420/. Initially the assessment was made under Section 143(1) a and thereafter a fresh assessment order was passed on 27/30.12.1996 on an income of Rs.1,43,56,729/- in addition to income of Rs.45737.00 from winning of lottery under Section 115 BB of the Act. The assessee filed appeal before the first appellate authority disputing the quantum of assessment and also the liability of interest under section 234B and 234 C of the Act. The Commissioner of Income Tax Appeal ) dismissed the appeal. Against the said order assessee filed appeal before the Tribunal. During the pendency of the appeal before the Tribunal , by the Finance (No.2) Act 1998 Kar Vivad Samadhan Scheme 98 has been introduced and the assessee filed a declaration under Section 88 of the said Act in respect of the arrears of the Tax and interest before the designated authority. The designated authority accepted the declaration and issued a certificate as contemplated under Section 90(1) of the Act in form No.2A .
It appears that after issue of this certificate by the designated officer Deputy Commissioner of Income Tax I, Kanpur passed an order dated 31.3.2000, under Section 154 of the Act. By the aforesaid order he has raised the additional demand of interest under Section 234 B. According to him the demand of interest has been less calculated earlier. Against the order passed under Section 154 the assessee filed an appeal before the Commissioner of Income Tax Kanpur (Appeals) . The said appeal was allowed and the order passed under Section 154 has been set aside. Against the said order Deputy Commissioner filed an appeal before the Tribunal . The Tribunal by the impugned order rejected the appeal. The Tribunal has held that sub Section (3) of Section 90 of Kar Vivad Samadhan Scheme provided that every order passed under sub Section (1) of Section 90 determining the sum payable under the scheme shall be conclusive in respect of the matter stated therein and no matter covered by such order should be re-opened in any proceedings under the direct tax enactment or indirect tax enactment or under any other law for the time being in force. Sub Section (4) of Section 90 further provides that an appeal or reference for the said assessment year shall be deemed to have been withdrawn on the day on which the order referred to in sub Section (2) is passed i.e. the day on which designated authority under Kar Vivad Samadhan Scheme issued certificate . It further provides that certificate can be withdrawn if it is bound to be false by designated authority at any stage and in that case it shall be presumed that declaration was never made and all the consequences will be deemed to have been revived. On the basis of the aforesaid provision it has been held that notice issued by the assessing authority under Section 154 of the Act was outside the ambit . The Tribunal further held that wheth certificere in such a situation the proceedings under section 154 where the assessing authority can raise further demand after issue of theate is a debettable issue where two opinions are possible. Therefore, provision of Section 154 of the Act can not be invoked. The Tribunal further observed that once designated authority has issued the certificate , the officer lower to the designated authority can not pass any order under Section 154.
We have heard Sri A.N.Mahajan learned standing counsel and Sri Ashish Bansal appearing on behalf of the respondents. We have perused the impugned orders. We do not find any error in the order. In view of the provisions of the Finance Act (No.2) of 1998 which provides Kar Vivad Samadhan Scheme , it is apparent that the order passed in Sub Section (1) of Section 90 determining the sum payable under the scheme shall be conclusive in respect of all the matters stated therein and no matter covered by such order shall be re-opened in any other proceeding under the direct tax enactment or indirect tax enactment or under any other law for the time being in force.
It further contemplates that only in a case where the certificate is found to be false the designated authority at any stage can withdraw the same. Therefore, we are of the view that after issue of the certificate in Kar Vivad Samachan Scheme under Section 90 of the Finance Act the assessing authority had no authority to sit over the certificate issued by the designated authority.
We are also of the view that whether after the issue of the certificate by the designated authority under Section 90 of the Finance Act , the assessing authority had power to raise fresh demand of interest, is debatable issue where two opinions are possible therefore, it can not be said to be a mistake apparent on the face of the record and is outside of the purview of Section 154. The Apex court in the case of TS Balram ITO Vs Volkart Brothers 82 ITR page 50 has held that where two opinions are possible and the issue involved is debatable , it can not be said to be a mistake apparent on the face of the record.
In view of the above, we do not find any error in the order of the Tribunal.
In the result the appeal fails and is dismissed.
Order Date :- 5.1.2010 cps