JUDGMENT
Kumar Rajaratnam, C.J.
1. In this petition preferred under article 226 of the Constitution of India the petitioner has prayed for declaration that section 95(i)(c) of the Finance (No. 2) Act, 1998 (hereinafter referred to as “the Act”), is ultra vires, being defiant of article 14 of the Constitution and further to issue a writ of certiorari quashing the impugned order dated April 16, 2003. In addition there is a prayer to consider the declaration filed by the assessee under section 88 of the Act on the merits.
2. The facts which are essential to be stated are that the late H. H. Krishnaji Rao Puar filed a petition under section 31(2A) of the Wealth-tax Act, 1957 (in short “the Wealth-tax Act”), before the Commissioner, Wealth-tax, Bhopal, on November 27, 1995, with a prayer of waiver of interest under section 31(2) for the assessment years 1961-62 and 1963-64 to 1990-91. The aforesaid petition faced rejection vide order dated January 24, 1997. The assessee, the late H. H. Krishnaji Rao Puar, filed an application under section 35(l)(b) on September 27, 1997, before the Commissioner, Wealth-tax, seeking rectification of his earlier order on the ground while rejecting the said petition certain facts were not considered. While the matter was pending the assessee moved an application before the Chief Commissioner, Wealth-tax, Bhopal, on July 29, 1998, for issue of a direction to the Commissioner of Wealth-tax for disposal of the application which was pending before the said authority within a period of six months. As no order was passed the petitioner preferred a Writ Petition No. 1900 of 1998.
3. As put forth in the petition during the pendency of the aforesaid petition the respondents enacted the Finance (No. 2) Act, 1998, which came into force and a scheme, namely, the Kar Vivad Samadhan Scheme, 1998, was framed. The objects of the scheme have been mentioned in the petition which basically provides a quick and voluntary settlement of tax dues outstanding as on March 31, 1998, both in respect of direct taxes as well as indirect taxes, it is urged in the petition that the scheme came into force on September 1, 1998, and the last date for availing of the benefit of the scheme was December 31, 1998. A reference has been made to the provision of section 95 of the Act which lays a postulate that the said scheme would be applicable in case, appeal, reference or writ petition is admitted and pending before any appellate authority, the High Court or the Supreme Court on the date of filing of declaration or application for review or revision is pending before the Commissioner on the date of filing of the declaration of the scheme. It is contended that the writ petition was filed on December 14, 1998, but the same was not put up before the court for consideration, for admission, however, it came up for admission on April 5, 1999, and the same was admitted. The said writ petition is pending for adjudication before this court. As pleaded, the petitioner disputed and denied the liability saddled on him by way of interest and accordingly the validity of the order passed by the authorities rejecting the prayer of the petitioner was assailed before this court in a writ petition preferred under article 226/227 of the Constitution of India and the matter was admitted. It is also the stand of the petitioner that penal action has been initiated against him without determining the bona fides of the petitioner. It is contended that these contentions have to be taken note of by the statutory authorities while exercising power under section 31(2A) of the Wealth-tax Act. But the Commissioner, Wealth-tax, refused to exercise his jurisdiction by not considering the genuine hardship and other unavoidable circumstances faced by the petitioner. It is highlighted in the petition that as that matter is sub judice before this court, he offered to pay 50 per cent. interest under the provision of the scheme, but the respondents rejected the same and passed an order on April 14, 2003, not only denying the petitioner’s right to take recourse to the provisions of the scheme but also acted against the interests of the Revenue. It is contended that the respondents ought to have considered and weighed that on the one hand the entire levy of interest is under challenge before this court by admission of the writ petition and, therefore, a hyper-technical view should not have been taken recourse to reject the application of the petitioner and levied interest. It is contended that the writ petition was filed on December 14, 1998, prior to the date of declaration but due to procedural impediment which was beyond the control of the petitioner, the writ petition could not be taken up immediately. It has been asseverated that the winter vacation ensued. The plea of prolonged illness of the assessee has been laid emphasis upon, which led to delay in admission of the writ petition. It is the stand of the petitioner that section 95(i)(c) has to be purposively construed and in that backdrop the order dated April 16, 2003, deserves to be set aside. It is averred that if restrictive interpretation is given to the provision it would frustrate the object of the statute and thereby becomes arbitrary inviting the wrath of article 14 of the Constitution of India.
4. A return has been filed on behalf of the respondents contending, inter alia, that the order dated April 15, 2003, rejecting the petitioner’s application under the Kar Vivad Samadhan Scheme, 1998, is neither illegal nor unsustainable because the provision contained under sub-clause (c) of clause (i) of section 95 gets attracted as the writ petition was not admitted and pending by cut off date. It has been emphatically put forth that though the petition was filed on December 14, 1998, it was only admitted on April 5, 1999, and therefore, the same could not be treated to be covered within the scheme and hence, the order passed by the authority cannot be held to be erroneous or fallible. It is contended that the provisions are absolutely clear and unambiguous and hence, the authorities are bound to comply with them and no fault can be found with the said application of the provision. It is contended that had the petitioner moved within the schedule the matter would have been different, but instead of doing that he has approached this court on December 14, 1998, as he intended to avail of the benefit of the scheme. The action of the late assessee has been criticised that his intention was not for issue of a direction to the Commissioner, Wealth-tax, but the petition was filed under section 35(l)(b) of the Wealth-tax Act to avail of the benefit of the scheme. It is contended that the 1998 Scheme is not applicable to the petitioner as the writ petition was not admitted and pending on the date of filing of the application or before the cut off date. It is set forth that the assessee was not entitled to the benefit of the scheme as the writ petition was admitted subsequently after the expiry of time for filing of application under the scheme. Justification has been advanced that a person is entitled to the benefit of the scheme if the conditions precedent laid down therein are fulfilled by him but as in the instant case the same were not fulfilled, the designated authority acted as per law and, therefore, the said order is absolutely flawless.
5. We have heard Mr. H. S. Shrivastava, learned senior counsel for the petitioner, and Mr. Rohit Arya, learned senior counsel for the Revenue.
6. To appreciate the scenario in entirety it is necessary to have a scan of the anatomy of the Kar Vivad Samadhan Scheme, 1998. Section 87 of the Scheme deals with various kinds of definitions. Section 88(m) postulates “tax arrear”. Section 88 envisages settlement of tax payable. Section 90 provides for time and manner of payment of tax arrear. Section 95 provides the scheme not to apply in certain cases. For our purpose it is relevant to reproduce section 95(i) of the scheme. It reads as under :
“95. The provisions of this scheme shall not apply-
(i) in respect of tax arrear under any direct tax enactment,–
(a) in a case where prosecution for concealment has been instituted
on or before the date of filing of the declaration under section 88 under
any direct tax enactment in respect of any assessment year, to any tax
arrear in respect of such assessment year under such direct tax enact
ment or in respect of a person who has been convicted for concealment
on or before the date of filing the declaration ;
(b) in a case where an order has been passed by the Settlement
Commission under sub-section (4) of section 245D of the Income-tax Act
or sub-section (4) of section 22D of the Wealth-tax Act, as the case may
be, for any assessment year, to any tax arrear in respect of such assess
ment year under such direct tax enactment ;
(c) in a case where no appeal or reference or writ petition is admitted and pending before any appellate authority or the High Court or the
Supreme Court on the date of filing of declaration or no application for
revision is pending before the Commissioner on the date of filing declaration.”
7. The submission of Mr. Shrivastava, learned senior counsel, is that section 95(i)(c) of the Scheme should be read down to mean a pending writ petition also would come within the ambit and sweep of the writ petition as engrafted under the aforesaid provision. Learned counsel has placed reliance on the decisions rendered in the cases of Radhika Prakashan Pvt. Ltd. v. Union of India [2002] 256 ITR 265 (MP); Vijay Omprakash Bansal v. CIT [2002] 257 ITR 649 (Bom) and Gufic Pharma Ltd. v. /. G. Arora [1999] 238 ITR 835 (Guj).
8. On a perusal of the aforesaid decisions what transpires is that the scheme has been brought into existence for the benefit of the assessee who wants a one-time settlement and the Revenue has to get early settlement and quick payment. The objectives have to be kept in view while considering the provisions of the Scheme and the courts must accept a beneficial interpretation which will serve both these objectives. In the case of Vijay Omprakash Bansal [2002] 257 ITR 649 (Bom) a regular assessee wanted to avail of the one-time settlement under the Scheme but the designated authority under the Scheme rejected the claim. Being aggrieved he approached the writ court whereby the writ court allowed the same taking note of the fact the explanation given by the petitioner for the delay in making payment was not disastrous to throw his case out inasmuch as the assessee should be possibly in doubt in regard to certain aspects. In the case of Radhika Prakashan Pvt. Ltd. [2002] 256 ITR 265 (MP), the learned single judge of this court was dealing with a case where an appeal preferred before the Income-tax Appellate Tribunal was dismissed in default of appearance of counsel. An application was filed for restoration and the Tribunal vide order dated June 1, 1999, recalled the order and restored the appeal. During the pendency of the appeal before the Tribunal, the petitioner had applied for settlement on January 23, 1989. The plea of settlement was rejected on the ground that on the date of filing of the application no appeal was pending before the appellate authority. The learned single judge placing reliance on the Division Bench decision of the Punjab and Haryana High Court in Sat Kartar Trading Co. v. CIT [2001] 250 ITR 859 came to hold that once the appeal is restored the original position stood restored and, therefore, it could be deemed that the appeal was pending for adjudication. The subsequent decision of the appeal does not affect the merits of the settlement.
9. In the present case it is worth noting here the order passed by the learned single judge of this court has been upheld by the Division Bench in a letters patent appeal, but the present case has a different factual scenario to project. The petitioner, as has been indicated earlier, filed a writ petition before this court for issue of a direction to the authority to deal with an application under section 35(l)(b) which was pending before him for more than six months. The writ petition was presented on December 14, 1998. In the writ petition assail was also to the levy of interest. The petitioner during the pendency of the writ petition filed an application under the scheme. The authorities on April 16, 20,03, rejected the claim. It is also highlighted that the original writ petitioner died on January 21, 1999. It is averred that the writ petition was admitted on April 5, 1999, and, therefore, the admission must relate back to the date of presentation. In essence, learned counsel while challenging the constitutional validity of the aforesaid provision has assiduously prayed before this court for reading down the provision.
10. The submission of Mr. Shrivastava, learned senior counsel is that the said provision should be read down to mean a pending writ petition would also be included pending before the cut off date even though it has not been admitted.
11. In this context we may refer with profit to the decision rendered in the case of P. R. Thangavelu v. CIT [2001] 250 ITR 492 (Mad). In the case of All India Federation of Tax Practitioners v. Union of India [1999] 236 ITR 1 (Delhi) a view has been expressed that when a fresh assessment is made in pursuance of the appellate order, the determination would relate back to the date of the original assessment. At this stage, it is appropriate to refer to the decision rendered in the case of Bindu Prasad Soni v. Union of India [2002] 258 ITR 663 (Raj), wherein it has been held as under (page 665) :
“Clause (i) of section 95 refers to pendency of the writ petition. The expression writ petition is admitted and pending is of great significance. It cannot be disputed that a writ petition is admitted by the court under articles 226 and 227 of the Constitution of India only when the court on application of judicial mind finds a prima facie case which requires an elaborate hearing.” (emphasis1 supplied)
12. We have referred to the aforesaid decisions to show that the courts have construed the language of the statute and also sometimes have given a beneficial angle to it. In this regard we may refer with profit to the decision rendered in the case of C. W. S. (India) Ltd. v. CIT [1994] 208 ITR 649 (SC). The apex court expressed the view that literal construction may be the general rule in construing taxing enactments, but that does not mean that it should be adopted even if it leads to a discriminatory or incongruous result. Their Lordships expressed the view that the interpretation of statutes cannot be a mechanical exercise and the courts are required to give effect to the objectives of the enactment having regard to the language used. In the case at hand, section 95(i)(c) should be read in two compartments. It postulates that a case where no appeal or reference or writ petition is admitted and pending before any . appellate authority, and the other one relates to revision where it has been provided no application for revision is pending. To elaborate : as far as pendency of the revision is concerned, that is good enough but as far as appeal or writ is concerned, it should be admitted and pending. We have already referred to the significance of admission and pending. In view of the clear and unambiguous language used by the statute we do not think, it would be appropriate to read anything to it as that would cause violence to the same. Reading down the said provision does not arise.
13. Ordinarily, we would have parted with the case, but it is not to be so. The present case has its own peculiar facet. The petitioner had filed an application under section 31(2A) of the Wealth-tax Act, 1957, before the Commissioner, Wealth-tax, Bhopal, requesting waiver of interest levied under section 31(2). The petition was rejected and thereafter he filed another application under section 35(l)(b) before the said authority for waiver of interest under section 31(2A) as the complete facts were not considered. As the matter was not finalised he had approached this court. The lis was in continuance. He filed a writ petition before this court before the cut off date. Winter vacation ensued and the matter could not be listed. As misfortune would have it the original asses-see left for heavenly abode. It has been said death is a great leveller and sometimes destroys the equanimity of the persons who survive as legal representatives. Therefore, there was delay. That apart, the matter was not listed in the ordinary course of nature as is perceptible from the records. Judged from this angle, we are of the considered opinion, the order rejecting the application under the Kar Vivad Samadhan Scheme, 1998, is liable to be quashed and the matter be settled as per law and accordingly we so direct. This order is passed keeping in view the special facts and circumstances of the case.
14. The writ petition is accordingly disposed of. There shall be no order as to costs.