SetCom to decide whether the assessee had made full and true disclosure and indicated the manner in which income was derived, till it passed its final order under section 245D(4)
The instant writ petition was filed by the Revenue against the orders of Commission (SetCom) declining to declare settlement applications of assessees as invalid. Revenue, aggrieved by the orders of commission, was of the view that settlement applications ought to have been held invalid as these applications failed to satisfy the prerequisites of full and true disclosure and the manner in which the undisclosed income had been derived
The High Court declined to interference with the orders of SetCom and made following observations:
1) The foundation for settlement was an application from the assessee in which he was required to make a full and true disclosure but such requirement hadn’t to be examined at the threshold stage of proceeding initiated before the Commission;
2) There might be cases where it was possible for the Commission to record a finding that the disclosure made in the application was full and true. At the same time, there could also be situations in which the Commission might not be able to record a finding with certainty at the stage of admission. In such a situation it would be permissible for the Commission to keep the question open, to be examined at a later stage or at the stage of disposal of the application;
3) The Commission might, at any stage till it passed a final order under Section 245D(4), examine the issues and if there was sufficient material on record, determine the question of full and true disclosure and the manner in which the undisclosed income was derived and, depending on such a decision, the applications might be thrown out or they might be proceeded with further;
4) The proceedings were pending before the Settlement Commission and the final order was yet to be passed by the Commission under Section 245D(4). All the conclusions drawn by the Settlement Commission in the instant case, were only prima facie conclusions and didn’t foreclose the issues raised by the Revenue in the present proceedings.
5) Thus, the impugned issue was left open for Commission's decision till it passed its final order under section 245D(4). Writ petition were, accordingly, to be dismissed. It was for commission to decide whether the assessee have made full and true disclosure and/or indicated the manner in which income was derived - CIT v. Income Tax Settlement Commission [2013] 35 taxmann.com 56 (Delhi)
The instant writ petition was filed by the Revenue against the orders of Commission (SetCom) declining to declare settlement applications of assessees as invalid. Revenue, aggrieved by the orders of commission, was of the view that settlement applications ought to have been held invalid as these applications failed to satisfy the prerequisites of full and true disclosure and the manner in which the undisclosed income had been derived
The High Court declined to interference with the orders of SetCom and made following observations:
1) The foundation for settlement was an application from the assessee in which he was required to make a full and true disclosure but such requirement hadn’t to be examined at the threshold stage of proceeding initiated before the Commission;
2) There might be cases where it was possible for the Commission to record a finding that the disclosure made in the application was full and true. At the same time, there could also be situations in which the Commission might not be able to record a finding with certainty at the stage of admission. In such a situation it would be permissible for the Commission to keep the question open, to be examined at a later stage or at the stage of disposal of the application;
3) The Commission might, at any stage till it passed a final order under Section 245D(4), examine the issues and if there was sufficient material on record, determine the question of full and true disclosure and the manner in which the undisclosed income was derived and, depending on such a decision, the applications might be thrown out or they might be proceeded with further;
4) The proceedings were pending before the Settlement Commission and the final order was yet to be passed by the Commission under Section 245D(4). All the conclusions drawn by the Settlement Commission in the instant case, were only prima facie conclusions and didn’t foreclose the issues raised by the Revenue in the present proceedings.
5) Thus, the impugned issue was left open for Commission's decision till it passed its final order under section 245D(4). Writ petition were, accordingly, to be dismissed. It was for commission to decide whether the assessee have made full and true disclosure and/or indicated the manner in which income was derived - CIT v. Income Tax Settlement Commission [2013] 35 taxmann.com 56 (Delhi)
No comments:
Post a Comment