THE HON’BLE SRI JUSTICE V.V.S.RAO AND THE HON'BLE SRI JUSTICE RAMESH RANGANATHAN REFERRED CASE No.2 of 1992 ORDER: (per Hon’ble Sri Justice Ramesh Ranganathan) The questions, referred for our opinion under Section 256(1) of the Income Tax Act, 1961, read as under. Asst.year 1983-84: “Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that the interest receipt of Rs.24,04,300/- should not be considered for being taxed as revenue?” Asst.year 1984-85 “Whether on the facts and in the circumstances of the case, the Tribunal was justified in holding that the interest receipt of Rs.16,70,367/- should not be considered for being taxed as revenue?” The assessee is a public sector undertaking. During the previous years 1983-1984 and 1984-1985 the assessee had not commenced its business of manufacture of steel. For the previous year ending 31.03.1983 and 31.03.1984 it earned interest of Rs.24,04,300/- and Rs.16,70,367/- respectively on its short-term deposits. This interest received by the assessee was held as taxable by the assessing authority. On appeal, the Commissioner of Income Tax (Appeals) confirmed the order of assessment. Aggrieved thereby, the assessee carried the matter in appeal to the Income Tax Appellate Tribunal which, following the decision of this Court in Commissioner of Income Tax v Nagarjuna Steels Limited[1], held that the interest received by the assessee was not taxable and, accordingly, allowed the appeal. Thereafter the questions referred to hereinabove are referred for our opinion. Sri.Y.Koteswara Rao, Counsel appearing on behalf of the assessee, would draw attention of this Court to the memo filed on 21.09.2010 whereby the assessee had paid the tax demanded, in Form 2A under Rule 4(a) of the Kar Vivad Samadhan Scheme Rules, 1998, on 22.03.1999 for the assessment years 1983-1984 and 1984-1985, as it fell under the Kar Vivad Samadhan Scheme, 1998. Counsel would contend that, since the matter has been settled under Kar Vivad Samadhan Scheme, 1998, the questions referred for our opinion need not be answered. Sri Badri Venkat Reddy, Standing Counsel for Income Tax, on instructions, agrees that this is indeed the position. In view of the fact that the matter has already been settled under the Kar Vivad Samadhan Scheme, 1998, we decline to answer the reference. The Referred Case is disposed of accordingly. __________________ (V.V.S.RAO, J) ______________________________ (RAMESH RANGANATHAN, J) 28.09.2010 vs [1] (1988) 171 ITR 663