(1) Notwithstanding anything contained in this Act or rules made thereunder or in any judgment, decree or order of any court, tribunal or appellate authority, any assessee, who is in arrears of tax or any other amount due under this Act or under the Central Sales Tax Act, 1956 (Central Act 74 of 1956),-

(i) in case of demands relating to the period up to and including 31st March, 2005, may opt for settling the arrears by availing a complete reduction of the penalty amount, interest on the tax amount and on the penalty amount, on payment of,-

(a) seventy per cent of the principal amount of the tax in arrears; or

(b) sixty per cent of the principal amount of the tax in arrears, if the amount is paid in lump sum within thirty days of receipt of intimation of the assessing authority.

(ii) in case of demands relating to the period from 1st April, 2005 to 31st March, 2022, may opt for settling the arrears on payment of the principal amount of the tax and interest in arrears by availing a complete reduction of the penalty amount:

Provided that in case where the evidence, details and records pertaining to the penalty levied is not utilized or not liable to be utilized for any best judgment assessment under this Act, the demand relating to such penalty shall be settled under this section on payment of applicable tax relating to the penalty as determined by the assessing authority.

Explanation.- Arrears for the purpose of this section shall include the tax remaining unpaid as on the date of option, under clause (a) of sub-section (1) of section 47 pursuant to the payment of compounding fee mentioned therein.

(2) Notwithstanding anything contained in the Kerala Revenue Recovery Act, 1968, (15 of 1968) reduction of arrears under sub-section (1) shall be applicable to those cases in which revenue recovery proceedings have been initiated and the assessing authorities shall have the power to collect such amounts on settlement under sub-section (1) and where the amount is settled under sub-section (1) the assessing authorities shall withdraw the revenue recovery proceedings against such assessees which will then be binding on the revenue authorities and such assessees shall not be liable for payment of any collection charges.

(3) The assessee shall withdraw all the cases pending before any appellate or revisional authority, tribunal or courts for opting for settling the arrears under this section and shall file a declaration to this effect along with the option mentioned under sub-section (5).

(4) All arrears including tax interest and penalties pertaining to a year shall be settled together under this section.

(5) An assessee who intends to opt for payment of arrears under sub-section (1) shall submit an option to the assessing authority on or before 31st August, 2022:

Provided that with respect to demands generated after 31st August, 2022 the option may be filed within thirty days from the date of receipt of the order and in such cases the final payment of tax and other amount due as per this section shall be completed before 31st December, 2022.

(6) The arrears for the purpose of settlement under this section shall be calculated as on the date of submission of option.

(7) On receipt of the option under sub-section (5), the assessing authority shall determine the amount of tax and other amounts due from the assessee under sub-section (1) and shall intimate the same to the assessee, and thereupon the assessee shall remit the amount in installments on or before 31st December, 2022:

Provided that the first installment thereof, for those who opt for payment as specified in sub-clause (a) of clause (i) and clause (ii) of sub-section (1), shall not be less than twenty per cent of the amount determined therein and such amount shall be paid within thirty days of receipt of the intimation and the balance amount to be paid in installments, subject to a maximum of four installments.

(8) Notwithstanding anything contained in section 55C, if an assessee who opts to settle his arrears under sub-section (1) has remitted or deposited any amount towards the arrears under this Act after the service of demand notice, such amounts shall be given credit as tax before reckoning the arrears to be settled under sub-section (6) and the assessee shall furnish the proof of payments made in this regard:

Provided that any amount paid towards penalty or its interest shall not be given credit.

(9) Notwithstanding anything contained in this Act, or in any judgment, decree or order of any court, tribunal or appellate authority, there shall not be any refund or any adjustment subsequently for the amount settled under this scheme, under any circumstances.

(10) Cases involved in Appeals and Revisions filed by an officer empowered by the Government under sections 39 and 40 and pending final orders on the date of option can also be opted to be settled under this scheme, reckoning the demand in the original assessment order.

(11) Assessees who opted to settle their arrears under this section during previous years, but had failed to make payments may also opt to settle their cases under this section, and Authenticity may be verified through https://compose.kerala.gov.in/ the amounts, if any, paid earlier shall be given credit as tax before reckoning the arrears to be settled under sub-section (6) and the assessee shall furnish the proof of payments made in this regard, provided that no refunds shall be allowed.

(11A) Where any amount has been paid in part under this section during the year 2020-21, the amount so paid shall be appropriated towards the earliest arrear, and the balance amount, if any, shall be appropriated towards the arrears of subsequent years. In the case where such amount is to be given credit towards the arrears opted to be setded under this section, the amount shall be given credit as tax before reckoning the arrears to be settled under sub-section (6).

Explanation:- For the purpose of this section, "earliest arrear" means the outstanding dues related to the oldest year among the arrears pending against the assessee.

(12) The arrears to be settled under this section shall not include any amount of tax retained by any assessee under garnishee orders of the competent court.