Continuation and validation of certain proceedings.
(1) Where any notice of demand in
respect of any Government dues is served upon an assessee by a Taxing Authority under any scheduled
Act, and any appeal or other proceeding is filed or taken in respect of such Government dues, then,--
(a) where such Government dues are enhanced in such appeal or proceeding, the Taxing
Authority shall serve upon the assessee another notice of demand only in respect of the amount by
which such Government dues are enhanced and any proceedings in relation to such Government dues
as are covered by the notice or notices of demand served upon him before the disposal of such appeal
or proceeding may, without the service of any fresh notice of demand, be continued from the stage at
which such proceedings stood immediately before such disposal;
(b) where such Government dues are reduced in such appeal or proceeding,--
(i) it shall not be necessary for the Taxing Authority to serve upon the assessee a fresh notice
of demand;
(ii) the Taxing Authority shall give intimation of the fact of such reduction to the assessee,
and where a certificate has been issued to the Tax Recovery Officer for the recovery of such
amount, also to that officer;
(iii) any proceedings initiated on the basis of the notice or notices of demand served upon the
assessee before the disposal of such appeal or proceeding may be continued in relation to the
amount so reduced from the stage at which such proceedings stood immediately before such
disposal;
(c) no proceedings in relation to such Government dues (including the imposition of penalty or
charging of interest) shall be invalid by reason only that no fresh notice of demand was served upon
the assessee after the disposal of such appeal or proceeding or that such Government dues have been
enhanced or reduced in such appeal or proceeding:
Provided that if as a result of any final order such Government dues (other than annuity deposit)
have been reduced and the penalty imposed on the assessee for default in payment thereof exceeds the
amount so reduced, the excess shall not be recovered, and if it has already been recovered, it shall be
refunded to the assessee on an application made by him to the Taxing Authority wihin such time and
in such manner as may be prescribed by rules made under this Act:
Provided further that if the amount of penalty imposed on the assessee for failure to make any
annuity deposit exceeds one-half of the amount of the annuity deposit required to be made as a result
of such order, the excess shall not be recovered and if it has already been recovered, shall be refunded
to the assessee on an application made by him to the Taxing Authority within such time and in such
manner as may be prescribed by rules made under this Act:
Provided further that where any Government dues are reduced in such appeal or proceeding and
the assessee is entitled to any refund thereof, such refund shall be made in accordance with the
provisions of that Act.
(2) For the removal of doubts, it is hereby declared that no fresh notice of demand shall be necessary
in any case where the amount of Government dues is not varied as a result of any order passed in any
appeal or other proceeding under any scheduled Act.
(3) The provisions of this section shall have effect notwithstanding any judgment, decree or order of
any court, tribunal or other authority.