Retrospective amendments cannot affect vested rights, and valid applications filed before such amendments remain enforceable.

JUDGMENT/ORDER

K.R. SHRIRAM, J - Since the pleadings are completed, by consent of the parties, we decided to dispose the petition at the admission stage itself.

2. Therefore, rule. Rule made returnable forthwith.

3. Petitioner is a company engaged in the business of manufacturing and trading in sugar, ethanol, power, etc. Petitioner received a notice dtd. 16/9/2021 from Assistant Commissioner of Income Tax, Central Circle 1(1), Pune, who is respondent no.1, stating that a valid application for Assessment Years 2014-15 to 2020-21 has not been filed by petitioner before the Settlement Commission. It is this notice alongwith a condition in a Press Release dtd. 7/9/2021 in so far as it seeks to make only those assessees eligible to file application before the Settlement Commission who were eligible as on 31/1/2021 which was challenged in the petition. Subsequently, upon leave being granted, the petition was amended to also impugn a notification dtd. 28/9/2021 in so far as it sought to make only those assessees eligible to file applications before the Interim Board Settlement Commission (IBSC), respondent no.3, who are eligible as on 31/1/2021.

Facts in brief :

4. On 25/7/2019 a search action under Sec. 132 of the Income Tax Act, 1961 (the Act) was conducted on petitioner and was concluded on 29/8/2019. Thereafter, petitioner received a notice dtd. 5/2/2021 under Sec. 153A of the Act for Assessment Years 2014-15 to 2020-21 calling upon petitioner to file return of income within 15 days. On 18/3/2021 petitioner filed before the Settlement Commission an application under Sec. 245C of the Act for Assessment Years 2014-15 to 2020-21.

5. In the meantime, a Finance Bill, 2021 was laid before the legislature on 1/2/2021. The Finance Bill proposed certain amendments to Chapter XIX-A of the Act including insertion of sub-sec. (5) to Sec. 245C of the Act to provide that 'No application shall be made under this Sec. on or after 1/2/2021".

6. It is stated in the petition that even though it was just the Bill and was not promulgated into the Act, certain benches of the Settlement Commission stopped accepting the applications after 1/2/2021. Later, based on directions given by various Courts, the Settlement Commission accepted and entertained the applications filed by assessees as the Bill gets enacted only after the assent of the Hon'ble President of India and till such time, the Settlement Commission is duty bound to accept applications so filed by assessees. Accordingly, petitioner made application to the Settlement Commission on 18/3/2021, which was accepted by the Settlement Commission.

7. The Hon"ble President of India gave assent to the Finance Bill on 28/3/2021 after which sub-sec. (5) was inserted in Sec. 245C of the Act. The other amendments in the Finance Act, 2021, in so far as they are relevant, are as under :

(i) Interim Board was defined in Sec. 245A(da) to mean a board as constituted under Sec. 245AA.

(ii) 'pending application' was defined in Sec. 245A(eb) to mean an application which was filed under Sec. 245C and which fulfills the following conditions, viz.:

(a) it was not declared invalid under sub-sec. (2c) of Sec. 245D of the Act; and

(b) No order under sub-sec. (4) of Sec. 245D was issued on or before 31/1/2021 with respect to such applications.

(iii) Interim Board was constituted as per Sec. 245AA of the Act.

(iv) A proviso was inserted in Sec. 245B of the Act to provide that the Settlement Commission shall cease to operate on or after 1/2/2021.

(v) Other provisions were also made in Chapter XIXA to provide for similar powers to the Interim Board settlement for settlement of disputes as were provided earlier to the Settlement Commission.

8. The Interim Board was notified by the Union of India by Notification No.91 of 2021 dtd. 10/8/2021.

9. Respondent no.3, the IBSC, issued a Press Release dtd. 7/9/2021 stating that in order to provide relief to the tax payers, who were eligible for filing applications as on 31/1/2021 and who could