- (1.) This order shall dispose of bunch of 11 petitions [C.W.P. 11727 of 2003; 16541, 16542, 17335, 17355, 17377, 17378, 17403, 17404, 17456, 17407 of 2004] [Editor] as the matter involved in all these petitions is covered by a judgment of the Constitution Bench of Hon'ble the Supreme Court rendered in the case of Brij Lal v. Commissioner of Income Tax, Jalandhar, 2010 328 ITR 477. The question which needs determination in all these petitions is as under: Whether the Settlement Commission could reopen its concluded proceedings by invoking section 154 of the Income Tax Act, 1961 so as to levy interest under Section 234B of the Act if it was not done in the original proceedings ? In all the cases in hand proceedings have been completed by the Settlement Commission and no interest under Section 234B of the Income Tax Act, 1961 (for brevity 'the Act') was initially imposed. Facts may be referred from CWP No. 17402 of 2004 where the premises of the petitioner were searched by the Income Tax Department on 10.12.1987 and the cash as well as the account books were seized by the raiding party. The petitioner filed Settlement Application under Section 245D of the Act before the Income Tax Settlement Commission- respondent No. 2. The Settlement Commission determined the income of the petitioner vide order dated 12.8.1999 (P. 1). On the issue concerning interest under Sections 234A, 234B and 234C of the Act the Settlement Commissioner placing reliance on the decision rendered by the Special Bench of the Settlement Commission, Bombay held that interest would be charged as per law laid down by Hon'ble the Supreme Court in the case of Gulraj Engineering Construction Company In re, and others 215 ITR 1.
(2.) On an application for rectification filed by the Income Tax Department under Section 154 of the Act before the Settlement Commission it was claimed that interest was required to be charged upto the date of order passed by the Settlement Commission. The petitioner contested the application and argued that the law laid down by Hon'ble the Supreme Court would not result into reopening the already settled cases and it would apply to cases either pending on that date or which were yet to mature. The argument was that the proceedings which had already attained finality and stood concluded cannot be reopened on the basis that there was a mistake apparent on the record.
(3.) Mr. Pankaj Jain and Mr. Sandeep Goyal learned counsel for the petitioners have vehemently argued that the matter is covered in favour of the assessee and against the revenue by the judgment of the Constitution Bench in Brij Lal's case . According to the learned counsel the Settlement Commission cannot reopen its concluded proceedings by invoking Section 154 of the Act so as to levy interest under Section 234B of the Act particularly in view the bar imposed by Section 245I of the Act.;