Where correct determination of income was dependent upon application of appropriate transfer pricing rule and, consequently, assessee made a revision in income initially disclosed before SetCom after considerable debate during the course of hearing, it could not be said that full and true disclosure of undisclosed income was not made in original application filed before SetCom.
Whether income initially disclosed before SetCom could be said to be concealed if additions were made due to transfer pricing provisions?
The High Court held in favour of assessee as under-
1) Normally, income offered for tax in an application made before settlement commission binds the parties concerned and any revision thereof, would prima facie, is deemed as evidence of the fact that full and true disclosure of undisclosed income was not made in original application. However, this is not cast in stone and depends upon the factual context of each case.
2) In the instant case, the correct determination of income was dependent upon the application of the appropriate transfer pricing rule which to an extent is subjective and, consequently, additional income was declared by assessee after a considerable debate over the transfer pricing provisions during the course of hearing before SetCom.
3) Therefore, assessee found to be made a bonafide disclosure in original application and it could not be said that income was not truly and fully disclosed by assessee- CIT v. Income Tax Settlement Commission  65 taxmann.com 40 (Bombay)