In Brief
Kakadia Builders, a private company, underwent a search and seizure in 1994 and sought settlement of its tax liability. The Settlement Commission waived interest in 2000, but later modified this in a rectification order in 2002. The High Court, while disposing of the revenue's petitions, adopted the directions from the 2002 order and incorporated them into its judgment. The Supreme Court held this was jurisdictional error: the 2002 order had been set aside in law and could not be relied upon. The Court remanded the matter to the Settlement Commission to reconsider the interest waiver issue afresh in light of Constitution Bench precedents clarifying the Commission's limited powers regarding interest.
The lawyer headnote and full judgment text are available to registered users.