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TMI Blog2010 (5) TMI 582X X X X Extracts X X X X X X X X Extracts X X X X ..... search operation was conducted at the residential and business premises of the assessee. The assessment was completed under section 158BC of the Income-tax Act, as evidenced by Ext.P1. 4. The undisclosed income has been determined for the block period at Rs. 43,92,960. It was challenged in appeal by the assessee. While the same was pending consideration, he filed a petition under section 245(1) of the Act before the Settlement Commission. Ext.P4 is the order passed by the Settlement Commission admitting the application. Ext.P2 is the order passed by the Commission which is under challenge in this original petition. 5. The Settlement Commission estimated the net profit on the total turnover for the block period at Rs. 12,09,120. The net in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ambu & Sons v. CIT [1996] 219 ITR 235 with regard to the legality of the assessment made on the basis of voluntary statement given by the assessee. Learned counsel for the second respondent relied upon the following decisions : N. Krishnan v. Settlement Commission [1989] 180 ITR 585/47 Taxman 294 (Kar.), Shriyans Prasad Jain v. ITO [1993] 204 ITR 616/70 Taxman 290 (SC) and CIT v. ITSC [2000] 246 ITR 63/112 Taxman 523 (Bom.), in support of his pleas. 9. A reading of Ext.P4 order passed by the Settlement Commission while admitting the application shows that the Assessing Officer had estimated the gross profit in the liquor division at 45 per cent. With regard to the voluntary statement, in para 6 it is clearly mentioned that the basis for es ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... upheld the assessment on the basis of the voluntary statement, treating it as valid. Herein, the question is quite different. The Settlement Commission, in exercise of its power, has adopted a method which cannot be said to be arbitrary. It cannot be said that the Settlement Commission is bound by the method adopted by the Assessing Officer itself, relying upon the voluntary statement. Significantly, materials, if any, have not been relied on by the petitioner before the Settlement Commission in support of the disclosure made in the voluntary statement. There is a finding in that regard, in Ext.P2 in para 4. Therefore, it cannot be said that the Settlement Commission had acted illegally in not exclusively relying upon the voluntary statemen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has filed the Wealth Statement for the period 31-3-1990 to 6-5-1999; increase in wealth to each year to 6-5-1999, and the cash flow statement for each year, details of investment in business in each firm, withdrawals, additions, investment in shares and bank deposits and immovable property have been furnished for each year and the department has no objection regarding the correctness of the above statement and has not raised any item of the asset which is not included in the wealth statement or any liability which is not correct. It cannot therefore be found that the order Ext.P2 suffers from any legal infirmities warranting interference. 13. The question is whether this Court in a writ petition, can interfere with such findings made on ce ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... recorded by the Commission. As pointed out by this Court in Jyotendrasinhji v. S.I. Tripathi [1993] 201 ITR 611, this Court can interfere with the Commission's order only if it is found to be "contrary to any of the provisions of the Act". To the same effect is the earlier decision of this Court in R.B. Shreeram Durga Prasad and Fatechand Nursing Das v. Settlement Commission (IT&WT) [1989] 176 ITR 169 (SC)." It is therefore clear that interference can be made only if it is found that the order is contrary to any of the provisions of the Act. The Bombay High Court in ITSC's case (supra), has also laid down the scope of interference in such matters and the scope of writ jurisdiction has been explained thus at page 79 : "The first question w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n sequence prior to the determination of the actual question which the inferior Tribunal has to try. In such a case, in certiorari proceedings the court can enquire into the correctness of the decision of the inferior Tribunal as to the collateral fact and may reverse that decision if it appears to it on material before it to be erroneous. The certiorari jurisdiction can also be exercised if conclusions are perverse and, therefore suffer from patent error on the face of the record." It was also observed at page 82 thus: "As pointed out in Jyotendrasinhji v. S.I. Tripathi [1993] 201 ITR 611/68 Taxman 59 (SC), this Court can interfere with the order if it is found to be contrary to the provisions of the Act." The above principles are therefo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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