Punjab-Haryana High Court
Sh. Ashok Goyal vs Union Of India And Others on 5 August, 2013
Bench: Jasbir Singh, G.S. Sandhawalia
CWP No. 10534 of 2007 and
connected matters -1-
IN THE HIGH COURT OF PUNJAB AND HARYANA AT
CHANDIGARH
*****
Date of decision : 5.8.2013
1. CWP No. 10534 of 2007
Sh. Ashok Goyal ........Petitioner
Vs.
Union of India and others ....Respondents
2. CWP No. 11022 of 2007
Munish Promoters and Developers Pvt. Ltd., Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
3. CWP No. 11023 of 2007
M/s B.M. Exports Pvt. Ltd., Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
4. CWP No. 11024 of 2007
Nangali Agro Tech. Pvt. Ltd., Gurdaspur ........Petitioner
Vs.
Union of India and others ....Respondents
5. CWP No. 11025 of 2007
Bombay Metal Works Pvt. Ltd., Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
6. CWP No. 11026 of 2007
M/s Parmeshwar Steels, Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
Kumar Ashwani
2013.09.04 14:32
I attest to the accuracy and
integrity of this document
CWP No. 10534 of 2007 and
connected matters -2-
7. CWP No. 11027 of 2007
Shree Ganpati Synthetics Pvt. Ltd., Amritsar ........Petitioner
Vs.
Union of India and others ....Respondents
8. CWP No. 11028 of 2007
Shri Nangali Rice Mills (P) Ltd., Mandi Gurdaspur ........Petitioner
Vs.
Union of India and others ....Respondents
9. CWP No. 11029 of 2007
Sonia Vohra ........Petitioner
Vs.
Union of India and others ....Respondents
10. CWP No. 11030 of 2007
Mani Mehra ........Petitioner
Vs.
Union of India and others ....Respondents
11. CWP No. 11031 of 2007
Sh. Vishesh Mehra ........Petitioner
Vs.
Union of India and others ....Respondents
12. CWP No. 11032 of 2007
M/s Damini Resorts & Builders Pvt. Ltd., Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
Kumar Ashwani
2013.09.04 14:32
I attest to the accuracy and
integrity of this document
CWP No. 10534 of 2007 and
connected matters -3-
13. CWP No. 11033 of 2007
M/s Basant Colonisers & Builders Pvt. Ltd., Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
14. CWP No. 11034 of 2007
Ranjit Kaur ........Petitioner
Vs.
Union of India and others ....Respondents
15. CWP No. 11035 of 2007
Anil Kumar ........Petitioner
Vs.
Union of India and others ....Respondents
16. CWP No. 11036 of 2007
Munish Manufacturing Corporation, Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
17. CWP No. 11037 of 2007
Baldev Raj ........Petitioner
Vs.
Union of India and others ....Respondents
18. CWP No. 11038 of 2007
Dev Arjuna Promoters and Developers Pvt. Ltd., Ludhiana ...Petitioner
Vs.
Union of India and others ....Respondents
Kumar Ashwani
2013.09.04 14:32
I attest to the accuracy and
integrity of this document
CWP No. 10534 of 2007 and
connected matters -4-
19. CWP No. 11039 of 2007
M/s Ram Nath Aggarwal & Sons, Gurdaspur ........Petitioner
Vs.
Union of India and others ....Respondents
20. CWP No. 11040 of 2007
Usha Kiran Bhasin ........Petitioner
Vs.
Union of India and others ....Respondents
21. CWP No. 11041 of 2007
Rajeev Vohra ........Petitioner
Vs.
Union of India and others ....Respondents
22. CWP No. 11042 of 2007
Rajesh Kumar Mittal ........Petitioner
Vs.
Union of India and others ....Respondents
23. CWP No. 11043 of 2007
Munish Kumar ........Petitioner
Vs.
Union of India and others ....Respondents
24. CWP No. 11044 of 2007
Shikha Bhasin ........Petitioner
Vs.
Union of India and others ....Respondents
Kumar Ashwani
2013.09.04 14:32
I attest to the accuracy and
integrity of this document
CWP No. 10534 of 2007 and
connected matters -5-
25. CWP No. 11045 of 2007
Neha Bhasin ........Petitioner
Vs.
Union of India and others ....Respondents
26. CWP No. 11046 of 2007
M/s Goldwheel Projects Pvt. Ltd., Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
27. CWP No. 11047 of 2007
M/s Prabhu Steel Traders, Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
28. CWP No. 11048 of 2007
Bhasin Industries, Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
29. CWP No. 11049 of 2007
Anil Kumar Mittal ........Petitioner
Vs.
Union of India and others ....Respondents
30. CWP No. 11050 of 2007
Gian Chand Mehra ........Petitioner
Vs.
Union of India and others ....Respondents
Kumar Ashwani
2013.09.04 14:32
I attest to the accuracy and
integrity of this document
CWP No. 10534 of 2007 and
connected matters -6-
31. CWP No. 11051 of 2007
Jasjit Singh ........Petitioner
Vs.
Union of India and others ....Respondents
32. CWP No. 11052 of 2007
Munish Forge Pvt. Ltd., Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
33. CWP No. 11053 of 2007
Sh. Munish Bhasin ........Petitioner
Vs.
Union of India and others ....Respondents
34. CWP No. 11054 of 2007
Inderjit Singh ........Petitioner
Vs.
Union of India and others ....Respondents
35. CWP No. 11055 of 2007
Parmod Kumar ........Petitioner
Vs.
Union of India and others ....Respondents
36. CWP No. 11056 of 2007
Manoj Kumar ........Petitioner
Vs.
Union of India and others ....Respondents
Kumar Ashwani
2013.09.04 14:32
I attest to the accuracy and
integrity of this document
CWP No. 10534 of 2007 and
connected matters -7-
37. CWP No. 11057 of 2007
Raj Kaushlya Bhasin ........Petitioner
Vs.
Union of India and others ....Respondents
38. CWP No. 11058 of 2007
Sunil Khanna ........Petitioner
Vs.
Union of India and others ....Respondents
39. CWP No. 11059 of 2007
Anil Kumar ........Petitioner
Vs.
Union of India and others ....Respondents
40. CWP No. 11060 of 2007
Satish Kumar ........Petitioner
Vs.
Union of India and others ....Respondents
41. CWP No. 11061 of 2007
Anil Khurana ........Petitioner
Vs.
Union of India and others ....Respondents
42. CWP No. 11062 of 2007
Munish International, Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
Kumar Ashwani
2013.09.04 14:32
I attest to the accuracy and
integrity of this document
CWP No. 10534 of 2007 and
connected matters -8-
43. CWP No. 11063 of 2007
Dharam Paul Mittal ........Petitioner
Vs.
Union of India and others ....Respondents
44. CWP No. 11064 of 2007
Renu Mehra ........Petitioner
Vs.
Union of India and others ....Respondents
45. CWP No. 11065 of 2007
Rakesh Khanna ........Petitioner
Vs.
Union of India and others ....Respondents
46. CWP No. 11066 of 2007
Devinder Bhasin ........Petitioner
Vs.
Union of India and others ....Respondents
47. CWP No. 11067 of 2007
Vijay Kumar ........Petitioner
Vs.
Union of India and others ....Respondents
48. CWP No. 11068 of 2007
M/s Jasbir Light & Tent House, Ludhiana ........Petitioner
Vs.
Union of India and others ....Respondents
Kumar Ashwani
2013.09.04 14:32
I attest to the accuracy and
integrity of this document
CWP No. 10534 of 2007 and
connected matters -9-
49. CWP No. 11069 of 2007
Balraj Bhasin ........Petitioner
Vs.
Union of India and others ....Respondents
50. CWP No. 11070 of 2007
Shree Ganpati Creations, Amritsar ........Petitioner
Vs.
Union of India and others ....Respondents
51. CWP No. 11071 of 2007
M/s Pali's Cater to Cater, Chandigarh ........Petitioner
Vs.
Union of India and others ....Respondents
52. CWP No. 11072 of 2007
Kavish Khurana ........Petitioner
Vs.
Union of India and others ....Respondents
53. CWP No. 11073 of 2007
Vijay Kumar ........Petitioner
Vs.
Union of India and others ....Respondents
54. CWP No. 11074 of 2007
Madan Lal Vohra ........Petitioner
Vs.
Union of India and others ....Respondents
Kumar Ashwani
2013.09.04 14:32
I attest to the accuracy and
integrity of this document
CWP No. 10534 of 2007 and
connected matters -10-
55. CWP No. 11075 of 2007
Menakshi Bhasin ........Petitioner
Vs.
Union of India and others ....Respondents
56. CWP No. 11077 of 2007
Sh. Kimti Lal Jain ........Petitioner
Vs.
Union of India and others ....Respondents
57. CWP No. 11078 of 2007
Neena Jain ........Petitioner
Vs.
Union of India and others ....Respondents
58. CWP No. 11164 of 2007
Sh. Madhav Lal Goyal ........Petitioner
Vs.
Union of India and others ....Respondents
59. CWP No. 11182 of 2007
Sh. Sunil Goyal ........Petitioner
Vs.
Union of India and others ....Respondents
CORAM: Hon'ble Mr. Justice Jasbir Singh
Hon'ble Mr. Justice G.S. Sandhawalia
Present:- Ms. Akshay Bhan, Advocate with
Mr. Alok Mittal, Advocate, for the petitioner
Mr. Rajesh Katoch, Advocate
for respondent No.3-Income Tax Department
---
Kumar Ashwani
2013.09.04 14:32
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integrity of this document
CWP No. 10534 of 2007 and
connected matters -11-
Jasbir Singh, J. (Oral)
1. This order shall dispose of a bunch of 59 writ petitions bearing CWPs No. 10534, 11022 to 11075, 11077, 11078, 11164 and 11182 all of 2007, as common questions of law and facts are involved therein. The facts are being taken from CWP No. 10534 of 2007 for dictating this order. In this writ petition challenge has been made to the provisions of Section 245D(2A) and Section 245D(2D) and Section 245HA of the Income Tax Act, 1961 (hereinafter referred to as "the Act") as substituted by an amendment by the Finance Act, 2007 with effect from 1.6.2007 being ultra vires.
2. The premises of the petitioner were searched under Section 132 of the Act on 17.1.1995. Thereafter, he filed an application on 29.1.1997 before the Settlement Commission-respondent no.2 under Section 245C(1) for assessment years 1993-94 to 1995-96. An order was passed on 16.12.1997 under Section 245D(1) allowing the petitioner to proceed with the application for the said assessment years and to pay the additional amount of income tax payable on the income disclosed and furnish proof of such payment to the Settlement Commission and the Assessing Officer as per provisions of Sub Section (2A) of 245D of the Act (prior to the amendment). It was further directed in case the additional amount is not paid within the time specified, the amount of income tax remaining unpaid together with interest payable thereon under sub section (2C) of Section 245D would be recovered in accordance with the provisions of Section 245D (2D). The averment of the petitioner is that liability of the said additional amount was duly discharged.
Kumar Ashwani 2013.09.04 14:32 I attest to the accuracy and integrity of this document CWP No. 10534 of 2007 and connected matters -12-
3. Thereafter, vide amendment from 1.6.2007 changes were made in sub sections (2A) & (2D) of Section 245D and Section 245HA which provided where an application for settlement of case before the Settlement Commission was made before 1.6.2007 then tax along with interest thereon must be paid on or before 31.7.2007 failure of which would result in the application not to proceed further.
4. Accordingly, the said amendment was challenged on the ground that the applicability of Sections 234A, 234B and 234C relating to levy of interest in case of default in filing return and delay in payment or deferment of advance tax to the proceedings before the Settlement Commission under Chapter XIX-A, had been referred to the Constitution Bench of the Supreme Court in Brij Lal and others Vs. Commissioner of Income-Tax [2010] 328 ITR 477 (SC). Challenge was also further raised on the ground that the said amendment was retrospective in operation and it is arbitrary and unreasonable.
5. Notice of motion was issued on 19.7.2007. Thereafter, on 30.7.2007, this writ petition was admitted. The petitioner was directed to deposit the additional tax along with interest, as per the amended provisions, referred to above, subject to the final out come of this writ petition.
6. The matter came up for hearing before this Court on 25.2.2009. It was noted that challenge to the above said provisions was pending before the Supreme Court. To await decision, the matter was adjourned.
7. Today before us, it is not disputed that the Supreme Court has Kumar Ashwani 2013.09.04 14:32 I attest to the accuracy and integrity of this document CWP No. 10534 of 2007 and connected matters -13- adjudicated upon the validity of the above said provisions in the case of Brij Lal and others v. Commission of Income Tax reported in (2010) Vol.328 ITR 477 (SC).
8. Counsel for respondent No.3 states that the dispute in these writ petitions is covered by ratio of the judgment in Brij Lal's case (supra) and the cases are liable to be dismissed.
9. A perusal of the Brij Lal's case (supra) case would show that the Apex Court while deciding the issue as to whether interest was payable under the proceedings pending before the Settlement Commission under Chapter XIX-A of the Act held that the applicant has to pay additional amount of tax with interest for which the application for settlement would be maintainable upto the stage of Section 245D(1) and the Settlement Commission cannot reopen its concluded proceedings under Section 154 of the Act so as to levy interest under Section 234B. It was noticed that amendment made by the Finance Act, 2007 with effect from 1.6.2007 was for this purpose. Relevant portion of the judgment reads as under:-
"Interest on default in payment of advance tax comes under sections 234A, 234B, 234C, which fall in Chapter XVII which deals with collection and recovery of tax. It is important to note that interest follows computation of additional payment of income tax under sections 245C(1B) and (1C). This is how sections 234A, 234B and 234C get engrafted into Chapter XIX-A at the stage of section 245D(1). As stated, till the Settlement Commission decides to admit the case under section 245D(1) the proceedings under the normal provisions Kumar Ashwani 2013.09.04 14:32 I attest to the accuracy and integrity of this document CWP No. 10534 of 2007 and connected matters -14- remain open. But, once the Commission admits the case after being satisfied that the disclosure is full and true then the proceedings commence with the Settlement Commission. In the meantime, applicant has to pay the additional amount of tax with interest without which the application for settlement would not be maintainable. Thus, interest under section 234B would be payable up to the stage of section 245D(1). Our view is supported by the amendment made by Finance Act of 2007 w.e.f. 1.6.2007 in which interest is required to be paid for maintainability of the application for settlement."
10. Keeping in view the said observations, the present writ petitions have thus, become infructuous in terms of the ratio of judgment mentioned above as the said amendment has been approved by the Apex Court.
11. In the matters which have already been decided, it is open to the applicants to seek refund in case the Settlement Commission has decided in their favour and where the cases are still pending, respondent no.2-Settlement Commission shall pass orders keeping in view the above referred judgment.
(Jasbir Singh) Judge (G.S. Sandhawalia) Judge 5.8.2013 Ashwani/Pardeep Arora Kumar Ashwani 2013.09.04 14:32 I attest to the accuracy and integrity of this document