A declarant under KVSS, 1998 cannot take a different stand after adjustment in record has been made as per instruction of declarant

RELEVANT PARAGRAPH

It necessary follows by implication that the deposits made otherwise under Section 140A of the Act is liable to be adjusted first against the tax due and then towards the interest payable thereon, submits the learned counsel for the petitioner. Learned Standing Counsel, on the other hand, submits that even if Section 140A of the Act is not applicable, the general principle of law is that where part payment has been made against sum due which consists of amount due’ and the ‘interest’, in the absence of any contrary instruction by the person making the payment, it should be adjusted first towards the interest accrued and then the remaining amount towards the principal. Even otherwise also, in the present case, there has been clear instructions in the challans filed by the petitioner specifying the heads of payment under the ‘tax due’ and the ‘interest due’, no such plea as the petitioner contends, on the facts of the present case, is available to it. The department has acted according to the instructions of the petitioner and it is too late for the petitioner to take a contrary stand which may now be more beneficial to it in view of the promulgation of KVSS. Considered the respective submissions of the learned counsel for the parties and perused the record.

Before examining the merits of the respective submissions of the learned counsel for the parties, it is desirable to have a look to the relevant provisions of KVSS. Definitions of ‘disputed income’ defined in clause (e)

and ‘disputed tax’ defined in clause (f) and ‘tax arrears’ defined in clause (m) of Section 87 of the said scheme were referred by the learned counsel for the petitioner, besides Section 88 thereof which provides the settlement of tax payable. Section 88 of the scheme, besides other things, provides that a declaration to the Designated Authority in accordance with the provisions of Section 89 in respect of tax arrears is required to be filed within a specified period. It further provides that in case a declaration being by company, as the case herein, the tax arrear is payable at the rate of 35% of the disputed income. The words ‘disputed income’ and ‘disputed tax’ have been defined by clauses (e) and (f) which are reproduced below:-

“87. In this Scheme, unless the context otherwise requires

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