Law:

Section:

Section 154 of the Income-tax Act, 1961, read with sections 90 and 91 of the Finance Act, 1998 - Rectification of mistakes - Apparent from records - Assessment years 1990-91 to 1992-93 - On basis of assessee's declaration under Kar Vivad Samadhan Scheme, revenue issued demanded under section 90(2) read with section 91 of 1998 Act which was paid by assessee - Thereafter revenue issued a revised demand demanding 50 per cent of interest, payable under section 222, which was not included in original demand - Assessee challenged impugned demand on ground that revenue had no authority to modify original demand which was accepted by him by making payment - It was not in dispute that besides liability for interest payable under sections 234A, 234B and 234C for all years interest was also payable under section 220(2) for all years which was also amount payable under Kar Vivad Samadhan Scheme, 1998 - Whether since assessee had not included interest under section 220(2) for settlement under Kar Vivad Samadhan Scheme, his declaration was defective as full liability was not shown there for settlement - Held, yes - Whether, therefore, revenue was justified in issuing impugned revised demand - Held, yes FACTS The revenue issued demand under section 90(2) read with section 91 of the Finance (No. 2) Act, 1998, demanding certain sum which was paid by the assessee in full and final settlement of liability for the three assessments years 1990-91, 1991-92 and 1992-93. Subsequently, the revenue issued revised demand demanding the differential amount payable by the assessee. On writ, the assessee contended that the revenue had no authority to modify demand which was accepted by the assessee by making payment. HELD The revenue issued revised demand demanding 50 per cent of the interest that was payable up to 31-3-1998, under section 222 which was not included in original demand which was the demand raised based on declaration furnished by the assessee. In declaration furnished by the assessee under the Kar Vivad Samadhan Scheme, interest payable was only for the assessment years 1990-91, 1991-92 and 1992-93 as, according to the assessee there was a demand of tax only for the year…

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