Delhi Tax Compliance Achievement Scheme, 2013 -“the Amnesty Scheme” = this Court has approached the issue arising in Grindlays Bank Ltd. (supra) we are of the view that Clause 8(3) of the Amnesty Scheme will have no application to the present case where the initial show cause notice was issued within time and its legitimacy was not contested by the respondent-Assessee. Had such legitimacy been questioned at the stage of reply or even in the course of the adjudication proceedings, there would still have been room/ time for the revenue to correct the error that had occurred. A rectified Notice could even have been issued after the order of adjudication was passed on 11th February, 2015. The close proximity of time between the reply submitted by the assessee to the Show 27 Cause Notice (27.01.2015) and the proceedings in adjudication Revenue on the one hand and the date of filing of the Writ Petition (4.3.2015) would permit us to infer that the conduct of the assessee in raising the issue in the writ petitions and not earlier was not entirely bonafide. The respondent-Assessee, therefore, cannot be allowed to take advantage of its own wrong. The courts exercising extraordinary jurisdiction cannot be understood to be helpless but concede to the assessee an undeserved victory over the Revenue.

1
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO(S).15605-15606 OF 2017
[Arising out of Special Leave Petition
(Civil) No.9631-9632 of 2017]
COMMISSIONER OF TRADE AND
TAXES AND ORS. ...APPELLANTS
VERSUS
M/S AHLUWALIA CONTRACTS
(INDIA) LTD. ...RESPONDENT
WITH
CIVIL APPEAL NO(S). 15608 OF 2017
[Arising out of Special Leave Petition
(Civil) No.10485 of 2017]
CIVIL APPEAL NO(S). 15607 OF 2017
[Arising out of Special Leave Petition
(Civil) No.9633 of 2017]
JUDGMENT
RANJAN GOGOI, J.
1. Leave granted.
2. A recital of the facts of the
Civil Appeals arising out of Special Leave
Petition (Civil) Nos.9631-9632 of 2017
alone are being made as the facts in the
other connected proceedings [i.e. Civil
Appeals arising out of Special Leave
2
Petition (Civil) Nos.10485/2017 and
9633/2017] are largely similar.
3. The challenge by the Revenue is to
an order of the High Court of Delhi by
which the High Court has allowed the writ
petitions filed by the respondents –
Assessees challenging the orders issued by
the Designated Authority i.e. Additional
Commissioner of Income Tax rejecting the
applications filed by the Respondent writ
petitioners under the Delhi Tax Compliance
Achievement Scheme, 2013 (hereinafter
referred to as “the Amnesty Scheme”),
details of which are noted below.
4. Under Section 107 of the Delhi
Value Added Tax Act, 2004 (hereinafter
referred to as “the DVAT Act”), the
Government of National Capital Territory
of Delhi (“GNCTD” for short) is empowered
to notify amnesty scheme(s) covering
payment of tax, interest, penalty or any
3
other dues under the DVAT Act relating to
any period ending before 1st April, 2013.
5. In exercise of powers under
Section 107 of the DVAT Act, an Amnesty
Scheme was notified by the GNCDT on 20th
September, 2013. Clause 2(c) of the
Amnesty Scheme which defines the
'designated authority'; clause 4 which
delineates the procedure for making
declaration and payment of tax dues;
clause 5 which deals with immunity from
interest, penalty and other proceedings;
and the provisions of clause 8 which deals
with the failure to make true declarations
would require a consideration of the
Court. The same are, therefore, reproduced
below for convenience:
“2(c) “designated authority”
means officer(s) not below the
rank of Joint Commisioner as
notified by the Commissioner,
Value Added Tax for the purposes
of this Scheme;
4
*** *** ***
4. Procedure for making
declaration and payment of tax
dues – (1) Subject to the other
provisions of this Scheme, a
person may make a declaration of
the tax dues to the designated
authority on or before the 31st
day of January 2014 in Form DSC-1
appended to this notification.
(2) The designated authority
shall acknowledge the receipt of
declaration in Form DSC-2
appended to this notification,
within a period of fifteen
working days from the date of
receipt of the declaration.
(3) The declarant shall pay not
less than fifty per cent of the
tax dues declared under
sub-clause (1) along with the
declaration and submit proof of
such payment to the designated
authority.
(4) The remaining amount of tax
dues or part thereof remaining to
be paid after adjusting the
payment made under sub-clause (3)
shall be paid by the declarant on
or before the 21st day of March,
2014.
(5) Notwithstanding anything
contained in sub-clause (3) and
sub-clause (4), any tax which
becomes due or payable by the
declarant for the tax period(s)
beginning from 1 day of April,
2013 and thereafter shall be paid
by him in accordance with the
provisions of the Act:
5
Provided that where an
unregistered dealer has made
declaration referred to in
sub-clause (1) of this clause,
such dealer shall obtain
registration and pay net tax for
the period from 1 day of April,
2013 to the date of regisration
and furnish return in Form
DVAT-16 for that period along
with proof of payment in Form
DVAT-20 to the designated
authority at the time of
furnishing of declaration under
this Scheme. Such a dealer shall
be eligible for immunity under
clause 5 ofteh Scheme for late
payment of such tax and
non-filing of return under the
Act.
(6) The declarant shall furnish
to the designated authority,
details of payment made from
time to time under this Scheme
along with a copy of
acknowledgement issued to him
under sub-clause (2).
(7) On furnishing the details
of full payment of declared tax
dues payable under sub-clause
(4), the designated authority
shall issue an acknowledgement of
discharge of such dues within
fifteen days to the declarant in
Form DSC-3 appended to this
notification.
(8) A dealer who has not taken
registration shall obtain
registration prior to filing of
declaration as referred in
6
sub-clause (1) of clause 4.
Likewise, a person who is
responsible for making deduction
of tax under section 36A of the
Act, shall obtain a Tax Deduction
Account Number (TAN), if not
already obtained.
*** *** ***
5. Immunity from interest,
penalty and other
proceedings.-(1) Notwithstanding
anything contained in any
provision of the Scheme, the
declarant, upon payment of the
tax dues declared by him under
sub-clause (1) of clause 4, shall
get immunity from penalty or
penalties, interest other than
interest payable in terms of
sub-clauses (2) and (4) of clause
3, prosecution or any other
proceedings under the Act or, as
the case may be, under the
Central Sales Tax Act, 1956 or
the erstwhile Delhi Sales Tax
Act, 1975 (43 of 1975) or the
Delhi Sales Tax on Works Contract
Act, 1999 (Delhi Act 9 of 1999)
or the Delhi Sales Tax on Right
to Use Goods Act, 2002 (Delhi Act
13 of 2002) or the Delhi Tax on
Entry of Motor Vehicles into
Local areas Act, 1994 (Delhi Act
4 of 1995), in relation to the
tax dues declared by the
declarant; and from penalty and
prosecution for non-registration
and non-furnishing of returns in
time.
Explanation.- For the purpose of
this sub-clause, the term
7
“declarant” shall include-
(i) in relation to the declarant
being a contractee, who has
awarded the works contract under
section 36A(1) of the Act, his
immediate contractor to whom he
has awarded the works contract,
to the extent of amount declared
by the contractee; and
(ii) in relation to the declarant
being a contractor, his immediate
contractee who has awarded the
works contract under section
36A(1) of the Act.
Explanation -For removal of
doubts, it is hereby declared
that, to avoid double taxation,
if the contractee has declared
tax dues, his immediate
contractor will also get immunity
to that extent, and vice-versa.
(2) Subject to the provisions of
clause 8, a declaration made
under sub-clause (1) of clause 4
shall become conclusive upon
issuance of acknowledgement of
discharge under sub-clause (7) of
clause 4 and no matter shall be
reopened/ reassessed/ reviewed
thereafter in any proceedings
under this Scheme or under the
Act before any authority or court
relating to the period covered by
such declaration to the extent of
tax dues declared by the
declarant.
(3) All statutory appeals/
revisions pending before
8
quasi-judcial forums upto the
stage of Tribunal shall be deemed
to have been withdrawn once the
Scheme is opted for. Further, all
matters pending in the High Court
and Supreme Court shall be
withdrawn by the declarant and he
will need to submit the
application filed for withdrawl
with the declaration. for the
case to be withdrawn before the
court.
(4) No proceeding shall be
instituted within 48 hours of
securing a registration,
provided, the registrant declares
his intent of opting under the
Scheme at the time of applying
for TIN/ TAN.
(5) The information gathered vide
a declaration under the scheme
shall be kept confidential and
shall not be used except under
the Scheme and the same shall not
be shared with any other person/
government department/agency.
*** *** ***
8. Failure to make true
declaration.- (1) Notwithstanding
anything contained in clause 5
of the Scheme, where the
Commissioner has, for a period
beginning from 1st April, 2009,
reasons to believe that the
declaration was false in material
particulars, he may, for reasons
to be recorded in writing, serve
notice on the declarant in
respect of such declaration
requiring him to show cause as to
why he should not be required to
9
pay the tax dues unpaid or
short-paid as per the provisions
of the Scheme.
(2) If the Commissioner is
satisfied, for reasons to be
recorded in writing, that the
declaration made by the dealer
was substantially false,
(i) he shall within three
months of service of notice under
sub-clause (1) make assessment of
tax and penalty under section 32
and 33 of the Act, as if that
dealer had never made declaration
under this Scheme. However, the
dealer shall be entitled to the
credit of tax paid by him under
this Scheme; and
(ii) such dealer may be
proceeded under sub-section (2)
of section 89 of the Act for
furnishing of false declaration.
(3) No notice shall be issued
under sub-clause (1) of this
clause after the expiry of one
year from the date of
declaration.”
6. There is no dispute between the
parties that on the basis of the
declaration filed by the respondent –
Assessee, the Designated Authority had
issued the “acknowledgement of discharge”
in favour of the respondent- Assessee.
10
However, on 16th January, 2015 a show cause
notice in exercise of powers under clause
8 of the Amnesty Scheme was issued by the
Additional Commissioner (Spl. Zone),
Department of Trade and Taxes, New Delhi
to which the respondent – Assessee
submitted its reply on 27th January, 2015.
In the reply so submitted, the respondent
– Assessee did not raise any question with
regard to the jurisdiction of the
Additional Commissioner to issue the show
cause notice under clause 8. The
adjudication was finalized by order dated
11th February, 2015 which was served to the
Assessee. The Assessee then filed the
writ petitions in question before the High
Court contending, inter alia, that the
show cause dated 16th January, 2015 was
unauthorized and without jurisdiction
inasmuch as the power to issue such notice
under clause 8 is vested with the
Commissioner and the same had not been
delegated to the Designated Authority i.e.
11
the concerned Additional Commissioner.
The said contention found favour with the
High Court. Accordingly, the writ
petitions filed by the respondents –
Assessees were allowed and the impugned
consequential proceedings were interfered
with. The High Court also took the view
that as under clause 8(3) of the Amnesty
Scheme show cause notice has to be issued
within one year of the date of declaration
which in the present case was made on 18th
February, 2014 and 28th February, 2014,
respectively, issuance of any
further/fresh show cause notice was time
barred. Aggrieved the Revenue is in
appeal before this Court.
7. Shri Maninder Singh, learned
Additional Solicitor General appearing for
the Revenue has vehemently contended that
the Government Order dated 30th April, 2014
contains a clear delegation of the power
under clause 8 of the Amnesty Scheme by
12
the Commissioner to the Designated
Authority. The power of disposal of the
application received under the Scheme,
according to the learned ASG, must
necessarily include the power to finalize
the matter after issuing the show cause
notice under clause 8 in an appropriate
case. Learned ASG has further urged that
under clause 4 the declarations are
required to be considered by the
Designated Authority i.e. the Additional
Commissioner. It is natural that the
power to reopen the cases concluded on
mistaken/suppressed facts must be
understood to have been available to the
Designated Authority at all times.
8. The above contentions are
contested by Shri S. Ganesh, learned
Senior Counsel appearing for the
respondents – Assessees who has urged that
keeping in mind the necessity of finality
of decisions under the Amnesty Scheme, the
13
power of reopening the concluded cases by
issuing show cause notices has been
conferred on a higher authority i.e. the
Commissioner. The said power has to be
distinguished from the power to decide an
application filed, which is vested in the
designated authority under Clause 4. It is
urged that in the present case the power
vested in the Commissioner under clause 8
has not been delegated to any other
authority, in the absence whereof, it was
not open for the Additional Commissioner
to issue the impugned show cause notice
dated 16th January, 2015. The fact that the
Assessee did not raise the issue of
jurisdiction before the Adjudicating
Authority would not clothe the Additional
Commissioner with the jurisdiction to
issue the show cause notice. As the said
issue is primarily a question of law which
goes to the root of the matter the
question could always have been raised
before the High Court. The same having
14
been so raised and answered by the High
Court, the answer provided needs to be
dealt with by this Court on merits and
ought not to be foreclosed merely on the
ground that the respondents – Assessees
had not raised the same in the course of
the adjudication of the show cause notice.
Learned Senior Counsel has referred to the
provisions of clause 8(3) of the Amnesty
Scheme to contend that the show cause
notice under clause 8 has to be issued
within one year of the date of
declaration/declarations and there is no
enabling provision to condone any delay
that has occurred or extend the time
stipulated by clause 8(3). As the period
of one year from the date of declaration
is long over, in the event this Court is
to hold that the impugned show cause
notice was issued by the Authority which
did not have the power and jurisdiction to
so act the question of issuance of any
fresh/revised notice does not arise.
15
9. On the rival contentions, two issues
arise for consideration in the present
appeal.
10. The first relates to the power and
jurisdiction of the Designated Authority
to issue the notice under clause 8 of the
Amnesty Scheme. Related, is whether, in
the present case, there has been any
delegation of the said power which is
vested in the Commissioner under the
aforesaid clause 8.
11. The second issue arising would depend
on an answer to the first, namely, if it
is to be held that the Designated
Authority is not empowered to act under
clause 8, whether a fresh notice under the
aforesaid clause of the scheme can still
be issued by the competent authority i.e.
the Commissioner or the delegatee of the
Commissioner.
16
12. What category of officers would come
within the expression “designated
authority” is contemplated by the
definition contained in clause 2 (c) of
the Amnesty Scheme. An Officer not below
the rank of Joint Commissioner as may be
notified by the Commissioner would be a
designated authority under the Scheme.
13. Clause 4 of the Scheme requires a
declaration of the tax due to be made to
the designated authority and, thereafter,
following the procedure prescribed by the
various sub-clauses of clause 4, the
Designated Authority is empowered to issue
the acknowledgment of discharge of dues
under clause 4 (7) of the Scheme.
14. Under clause 8 of the aforesaid
scheme, the Commissioner is vested with
the power, to be exercised for reasons
recorded in writing, to issue notice to
17
the assessee requiring him to show cause
as to why he should not pay the tax/ dues
unpaid or short paid as per the provisions
of the scheme. The power to issue the
notice under clause 8 is undoubtedly
vested with the Commissioner and not in
the Designated Authority. What is vested
in the Designated Authority is the power
under clause 4 of the Scheme which is the
power to hear and decide applications and
issue acknowledgments of discharge on due
satisfaction. The said power to hear and
decide applications, by no means, would
include the power to reopen a decided
matter which is what clause 8 specifically
contemplates. The Government order dated
30th April, 2014 relied upon by the Revenue
as a delegation of the power under clause
8, on a plain reading thereof, is only an
empowerment of a particular Additional
Commissioner of a particular Zone (a Zone
may have several Additional Commissioners)
to hear and decide applications filed
18
under the Scheme. The said G.O dated 30th
April, 2014 cannot be construed to be an
exercise of delegation of powers vested in
the Commissioner under Clause 8 to
Designated Authority. The plain language
contained in the said G.O is capable of
sustaining the above conclusion. We will,
therefore, have to hold that the
Additional Commissioner who had issued the
show cause notice under clause 8 in the
present case was not competent to do so
and on that basis we affirm the conclusion
of the High Court on the said question.
15. This will bring us to a consideration
of the second issue arising in the case
details of which have already been
mentioned in preceding paragraphs of the
present order.
16. The declarations in the present case
were issued to the assessee on 18th
19
February, 2014 and 28th February, 2014
respectively. The show cause notice under
Clause 8 was issued on 16th January, 2015.
The reply was submitted by the
respondent-assessee on 27th January, 2015.
The adjudication was completed by the
Order dated 11th February, 2015 against
which the respondent-Assessee filed a writ
petition before the High Court on 4th
March, 2015. In the reply filed by the
respondent-Assessee to the show cause
notice or in the proceedings pursuant
thereto, as already mentioned, no
objection was taken by the assessee to the
power and jurisdiction of the Additional
Commissioner to issue the notice in
question. The adjudication order,
therefore, did not deal with the said
issue. It is only after the period of one
year from the date of declaration was over
that the writ petition was filed wherein
the question of jurisdiction of the
Additional Commissioner was raised for the
20
first time. It is in these facts that the
High Court took the view that as the
period of limitation prescribed by Clause
8(3) was over, fresh proceedings stood
barred by time.
17. While it is correct that the failure
to raise the issue of jurisdiction by the
assessee will not necessarily clothe the
Additional Commissioner with the
jurisdiction if the same is not
contemplated by law, there are certain
aspects of the case which need to be
considered. Had the assessee raised the
question of jurisdiction in its reply or
in the course of the adjudication
proceedings there would have been still
time for the Commissioner to cure the
defect and issue a valid notice. Cases
under Amnesty Scheme would fall outside
the arena of ordinary and routine matters
and, therefore, it is possible to
attribute a genuine mistake on the part of
21
the Additional Commissioner in invoking
jurisdiction under Clause 8 of the Amnesty
Scheme. The question that looms large
before the Court is that whether in such a
situation the assessee should be allowed
to raise the question of limitation and
defeat the claim of the revenue to proceed
afresh in the matter on that basis.
18. Dealing with a somewhat similar
situation that arose before this Court in
Grindlays Bank Ltd. vs. Income Tax
Officer, Calcutta and Ors.1 it was observed
as follows in Para 7 of the report in the
following manner.
“7. The next point is whether the
High Court possessed any power to
make the order directing a fresh
assessment. The principal relief
sought in the writ petition was
the quashing of the notice under
Section 142(1) of the Income Tax
Act, and inasmuch as the assessment
order dated March 31, 1977
was made during the pendency of
the proceeding consequent upon a
purported non-compliance with that
notice, it became necessary to ob-
1 (1980) 2 SCC 191
22
tain the quashing of the assessment
order also. The character of
an assessment proceeding, of which
the impugned notice and the assessment
order formed part, being
quasi-judicial, the “certiorari”
jurisdiction of the High Court under
Article 226 was attracted. Ordinarily,
where the High Court exercises
such jurisdiction it
merely quashes the offending order
and the consequential legal effect
is that but for the offending order
the remaining part of the proceeding
stands automatically revived
before the inferior court or
tribunal with the need for fresh
consideration and disposal by a
fresh order. Ordinarily, the High
Court does not substitute its own
order for the order quashed by it.
It is, of course, a different case
where the adjudication by the High
Court establishes a complete want
of jurisdiction in the inferior
court or tribunal to entertain or
to take the proceeding at all. In
that event on the quashing of the
proceeding by the High Court there
is no revival at all. But although
in the former kind of case the
High Court, after quashing the offending
order, does not substitute
its own order it has power nonetheless
to pass such further orders
as the justice of the case
requires. When passing such orders
the High Court draws on its inherent
power to make all such orders
as are necessary for doing complete
justice between the parties.
The interests of justice require
that any undeserved or unfair advantage
gained by a party invoking
the jurisdiction of the court, by
23
the mere circumstance that it has
initiated a proceeding in the
court, must be neutralised. The
simple fact of the institution of
litigation by itself should not be
permitted to confer an advantage
on the party responsible for it.
The present case goes further. The
appellant would not have enjoyed
the advantage of the bar of limitation
if. notwithstanding his immediate
grievance against the notice
under Section 142(1) of the
Income Tax Act, he had permitted
the assessment proceeding to go on
after registering his protest before
the Income Tax Officer, and
allowed an assessment order to be
made in the normal course. In an
application under Section 146
against the assessment order, it
would have been open to him to
urge that the notice was unreasonable
and invalid and he was prevented
by sufficient cause from
complying with it and therefore
the assessment order should be
cancelled. In that event, the
fresh assessment made under Section
146 would not be fettered by
the bar of limitation. Section
153(3)(i) removes the bar. But the
appellant preferred the constitutional
jurisdiction of the High
Court under Article 226. If no order
was made by the High Court directing
a fresh assessment, he
could contend as is the contention
now before us, that a fresh assessment
proceeding is barred by
limitation. That is an advantage
which the appellant seeks to derive
by the mere circumstance of
his filing a writ petition. It
will be noted that the defect com-
24
plained of by the appellant in the
notice was a procedural lapse at
best and one that could be readily
corrected by serving an appropriate
notice. It was not a defect
affecting the fundamental jurisdiction
of the Income Tax Officer
to make the assessment. In our
opinion, the High Court was
plainly right in making the direction
which it did. The observations
of this Court in Director of
Inspection of Income Tax (Investigation)
New Delhi v. Pooran Mall &
Sons2 are relevant. It said:
The Court in exercising
its powers under Article
226 has to mould the remedy
to suit the facts of a
case. If in a particular
case a court takes the view
that the Income Tax Officer
while passing an order under
Section 132(5) did not
give an adequate opportunity
to the party concerned
it should not be left with
the only option of quashing
it and putting the party at
an advantage even though it
may be satisfied that on
the material before him the
conclusion arrived at by
the Income Tax Officer was
correct or dismissing the
petition because otherwise
the party would get an unfair
advantage. The power
to quash an order under Article
226 can be exercised
not merely when the order
sought to be quashed is one
made without jurisdiction
2 (1975) 4 SCC 568
25
in which case there can be
no room for the same authority
to be directed to
deal with it. But in the
circumstances of a case the
court might take the view
that another authority has
the jurisdiction to deal
with the matter and may direct
that authority to deal
with it or where the order
of the authority which has
the jurisdiction is vitiated
by circumstances like
failure to observe the
principles of natural justice
the court may quash
the order and direct the
authority to dispose of the
matter afresh after giving
the aggrieved party a reasonable
opportunity of
putting forward its case.
Otherwise, it would mean
that where a court quashes
an order because the principles
of natural justice
have not been complied
with, it should not while
passing that order permit
the tribunal or the authority
to deal with it again
irrespective of the merits
of the case.
The point was considered by the
Calcutta High Court in Cachar Plywood
Ltd. v. ITO3 and the High
Court, after considering the provisions
of Section 153 of the Income
Tax Act, considered it appropriate.
while deposing of the writ
petition, to issue a direction to
3 (1978) 114 ITR 379 (Cal)
26
the Income Tax Officer to complete
the assessment which, but for the
direction of the High Court, would
have been barred by limitation.”
19. Having considered the matter and the
manner in which this Court has approached
the issue arising in Grindlays Bank Ltd.
(supra) we are of the view that Clause
8(3) of the Amnesty Scheme will have no
application to the present case where the
initial show cause notice was issued
within time and its legitimacy was not
contested by the respondent-Assessee. Had
such legitimacy been questioned at the
stage of reply or even in the course of
the adjudication proceedings, there would
still have been room/ time for the revenue
to correct the error that had occurred. A
rectified Notice could even have been
issued after the order of adjudication was
passed on 11th February, 2015. The close
proximity of time between the reply
submitted by the assessee to the Show
27
Cause Notice (27.01.2015) and the
proceedings in adjudication Revenue on the
one hand and the date of filing of the
Writ Petition (4.3.2015) would permit us
to infer that the conduct of the assessee
in raising the issue in the writ petitions
and not earlier was not entirely bonafide.
The respondent-Assessee, therefore, cannot
be allowed to take advantage of its own
wrong. The courts exercising extraordinary
jurisdiction cannot be understood to be
helpless but concede to the assessee an
undeserved victory over the Revenue. The
power of the High Court under Article 226
of the Constitution, wide and pervasive as
it is, should have enabled the High Court
to appropriately deal with the situation
and issue consequential directions
permitting initiation of fresh
proceedings, if the Revenue was so
inclined. The High Court having failed to
so act, we now correct the error and issue
directions to enable the Revenue to issue
28
a fresh notice to the assessee under
clause 8 of the Amnesty Scheme, if it so
desires and is so advised.
20. In the light of the foregoing, we
allow these appeals in terms of the
directions as above and set aside the
order of the High Court impugned in the
appeals.
....................,J.
(RANJAN GOGOI)
....................,J.
(NAVIN SINHA)
NEW DELHI
OCTOBER 4, 2017