(1) Notwithstanding anything contained in the Relevant Act or under this Act,-
(a) any payment made in respect of a statutory order either in the appeal or otherwise, on or before the date of commencement of this Act, shall first be adjusted towards the amount of undisputed tax and then disputed tax, thereafter, towards the interest and the balance amount remaining unadjusted, shall then be adjusted towards the penalty and the late fee, sequentially;
(b) any amount of refund due to the applicant in respect of any statutory order or appeal order or court order, which has remained un-adjusted on the date of payment of requisite amount, shall be adjusted towards arrears of tax, interest, penalty and late fee,-
(i) refund shall first be adjusted towards any arrears outstanding for other periods under the same Act in chronological sequence of the underlying period and after satisfaction of all the arrears under that Act, adjustment shall be done towards arrears of remaining Act sequentially, as specified in clause (k) of sub-section (1) of section 2 of this Act;
(ii) subject to the provision of sub-clause (i), such refund shall first be adjusted towards the amount of un-disputed tax and then disputed tax, thereafter, towards the interest and the balance amount remaining unadjusted, shall then be adjusted towards the penalty and the late fee, sequentially.
(2) The necessary adjustment order giving effect to such adjustment may be issued by the designated authority along with the settlement order.
(3) Any demand as per statutory order passed for specified period either before the commencement of this Act or during the period specified in the Table given in section 10, as reduced by amount specified in sub-section (1) as applicable, at any time before or at the time of payment of requisite amount, shall be considered as arrears of tax, interest, penalty or late fees for the purpose of settlement under this Act.
(4) The provisions of foregoing clauses in respect of adjustment of amount paid or any refund due and determination of arrears shall be applicable mutatis mutandis to the return dues or, as the case may be, dues as per the recommendations made in respect of tax, interest or late fee by the auditor in the Audit report.