- (1.)The basic issue involved in this appeal is whether the Settlement Commission (hereinafter referred to as "the Commission") gets a complete role in total substitution of other authorities under the Income Tax Act, 1961 (in short "the Act") and if so, for what purpose and to what extent. When this appeal was placed before a Bench of two learned Judges, it was considered appropriate to list the appeal before a larger Bench than merely a Bench of two Judges. 2. That is how the matter was placed before us. 3. The factual backdrop in a nutshell is as follows: the respondent Damani Brothers (hereinafter referred to as "the assessee") filed an application for settlement before the Mumbai Bench of the Commission. The Chairman of the Commission exercising power under Section 245-BA (5-A) of the Act constituted a Special Bench vide the order dated 18-9-1998 for adjudicating the following three issues: 90 "1. Was the Special Bench of the Settlement Commission right in holding in the case of Om Metals and Minerals (P) Ltd. , In re{ that the assessment order passed by the Assessing Officer before the admission of the settlement application subsisted and recovery proceedings continued, even after the admission of the said application, especially after the judgment of the Supreme Court in the case of CIT v. Express Newspapers Ltd.
(2.)If the answer to Question 1 is in the affirmative, would it be correct to say that once the Settlement Commission determines a liability of the applicant for tax, penalty and interest under Section 245-D (4) , the orders of the lower authorities would automatically stand set aside and consequently, there will be no liability under Section 220 (2) of the Act
(3.)If the answer to Question 1 is in the affirmative and Question 2 in the negative, has the Settlement Commission powers to waive interest under Section 220 (2) of the Act -