( 1 ) THIS petition challenges rejection of petitioners declaration under Kar Vivad Samadhan Scheme promulgated under the Finance (No. 2) Act of 1998, inter alia, on the ground that a revision against the order u/s 154 dated 1. 1. 98 on 29. 1. 99 was infructuous inasmuch as the order u/s 154 was made without any objection from the assessee petitioner. Such revision has to be ignored. The petitioner cannot be said to be falling within sec. 95 (i) (c) of the said Act.

( 2 ) THE undisputed facts which have emerged from the averments made in the petition and replies for the present purposes are that for the Assessment Year 1996-97 the assessee claimed certain deductions u/s 80i in respect of which assessee has filed an appeal before CIT (Appeals) which was decided on 23. 3. 97 by which the assessee was allowed a deduction of Rs. 20,80,791. The Assessing Officer, namely, the Deputy Commissioner of Income-tax, was of the view that the said sum has wrongly been allowed in the Assessment Year 1994-95 as assessee has ceased to be eligible for such deduction after A. Y. 1993-94 and this is a mistake apparent on the face of record. A notice to that effect was issued on 4. 12. 97 purporting to be u/s 154. The assessee realising that this was mistake agreed for the deletion of the said amount from the assessment in pursuance of which an order was made on 1. 1. 98 deleting the said deduction u/s 80 I and to issue demand notice as a consequence of rectification. Demand notice in pursuance of rectification application showed levy of additional tax which could be charged u/s 143 (1a) while making adjustments u/s 143 (1) (a ). After making the addition of additional tax the entire liability towards tax and additional tax was adjusted against the amounts paid by the assessee and demand notice was issued in respect of interest charged u/s 234a and 234b. Said demand for the A. Y. 1994-95 remains unpaid.

( 3 ) WITH effect from 1. 9. 1998 Finance (No. 2) Act, 1998 had introduced a scheme known as Kar Vivad Samadhan Scheme which provided for settlement of tax arrear. Under sec. 87 (m), according to which determination in respect of tax, interest or penalty for any assessment year ought to have been made prior to 31. 3. 98, subject to any modification that could be made in that computation for giving effect to appellate orders. To the extent whole or any part of it remains outstanding as on the date of declaration, that is to be considered tax arrear in respect of the concerned assessment year under the Income-tax Act, 1961, which is one of the Direct Taxes Enactment to which KVSS was extended. The second condition relevant for the present purposes is that unless in respect of tax arrear an appeal, reference or writ petition was admitted and pending, or a revision was pending on the date of declaration, no provision of the KVSS would be operative in the case of such person. Likewise, whole or any part of the tax determined on or before 31. 3. 99 modified by giving effect to the appellate orders should be unpaid as on the date of declaration.

( 4 ) THE petitioner filed a revision u/s 264 before the Commissioner on 29. 1. 99 challenging the order u/s 154 dt. 1. 1. 98 and made a declaration u/s 89 of the KVSS, inter alia, stating that the amount of interest u/s 234a and 234b was determined in respect of Assessment Year 1994-95 prior to 31. 3. 98, and was still unpaid on the date of declaration and that a revision in respect of tax arrear was also pending as on the date of declaration the assessee fulfils both the conditions. As noticed above, the designated officer, namely, the C. I. T. rejected the declaration stating that a revision against an order, which was made without objection, was infructuous and was merely to take advantage of KVSS which cannot be taken note of.

( 5 ) IT was urged by learned counsel for the petitioner that, firstly, it is not for the Designated Authority to go into the merits of the pending revision while considerin