Constitutional validity of section 254HA

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 IN THE HIGH COURT OF GUJARAT AT AHMEDABAD

SPECIAL CIVIL APPLICATION No. 5208 of 2008

With

SPECIAL CIVIL APPLICATION No. 5407 To 5409, 5353, 5364, 5295 To 5307, 5309 To 5329, 5431 To 5436, 5439, 5443 To 5456, 5459 To 5461, 5969 To 5971, 5973, 5974, 5209 To 5212, 5215, 5217 To 5219, 6361, 6362, 6364, 6366 To 6371, 6422 To 6441, 6708 To 6711, 6846 To 6848, 6307 To 6312, 6273, 5469 To 5471, 5401 To 5406, 7322 To 7328 of 2008.

COMED LABORATORIES LIMITED & Ors. – Petitioners Versus  UNION OF INDIA & Ors. – Respondents

 Appearance:

MR RK PATEL for Petitioners,

RULE NOT RECD BACK for Respondent(s): 1,

MRS MAUNA M BHATT for Respondent(s): 2,

MR MANISH R BHATT for Respondent(s): 2,

CORAM: HONOURABLE MR.JUSTICE M.S.SHAH and HONOURABLE MR.JUSTICE RAVI R.TRIPATHI

Date: 16/05/2008

COMMON ORAL ORDER

(Per: HONOURABLE MR. JUSTICE M.S.SHAH)

This is a group of writ petitions challenging the constitutional validity of the provisions of Section 245HA of the Income Tax Act, 1961 under which the petitioners’ applications before the Settlement Commission are to be treated as having abated on account of failure of the Settlement Commission to pass orders under Section 245D(4) of the Act on or before 31.03.2008.

2. In Special Civil Application No.5208 of 2008 and other matters, we issued Rule and notice as to interim relief returnable on 05.05.2008. After considering the interim orders passed by the Division Bench of the Delhi High Court and the Division Bench of the Bombay High Court in similar matters, we also granted ad-interim relief to the effect that the Settlement Commission shall not consider the settlement applications filed by the petitioners as having abated under Section 245HA of the Act for want of compliance with Section 245D(4A) as amended by the Finance Act, 2007. We also granted ad-interim relief restraining the Assessing Officers from taking up the matters where the petitioners’ applications were pending before the Settlement Commission before 31.03.2008.

3. Our attention is invited to the interlocutory order dated 31.03.2008 passed by the Hon’ble Supreme Court in Writ Petition (Civil) No.113 of 2008 (Prabhu Dayal Vs. Union of India), which reads as under :-

“Issue notice.

There shall be an interim stay of the provision for abatement of the proceedings relating to the petitioner pending before the second respondent.

The pendency of this writ petition will not come in the way of the Income Tax Settlement Commission in disposing of the matter before it in accordance with law.”

4. The learned advocates for the petitioners state that the issue involved in the present petitions is the same as in the aforesaid case pending before the Hon’ble Supreme Court and that, therefore, the petitioners agree to abide by the outcome of the above petition and in any other connected matters on the same issue, which may be decided by the Hon’ble Supreme Court. The learned advocates for the petitioners’ further state that the petitioners would be interested in intervening before the Hon’ble Supreme Court.

5. Since the subject matter of the present petition is also very much before the Hon’ble Supreme Court and the petitioners agree to abide by the outcome of the decision of the Hon’ble Supreme Court in the petition/s involving the same subject matter, we are of the  view that no useful purpose would be served by keeping these petitions pending.

6. We, therefore, dispose of these petitions with a direction that the petitioners as well as the respondents shall abide by the outcome of Writ Petition (Civil) No.113 of 2008 and connected matters before the Hon’ble Supreme Court.

7. We further direct that till the Hon’ble Supreme Court decides the issue which is raised in the present group of petitions, the assessing authorities and the appellate authorities under the Income Tax Act, 1961 shall not take up the matters which are to be treated as pending before the Settlement Commission and disposal of these petitions on the above ground shall not come in the way of the Settlement Commission in disposing of the matters before it in accordance with law.

8. Liberty to revive the petitions in case of necessity, upon filing a note before the Registry.

Registry is directed to place a copy of this order in each petition.

[M.S. SHAH, J.]

[RAVI R. TRIPATHI, J.]