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2015 (5) TMI 826 - BOMBAY HIGH COURT

2015 (5) TMI 826 - BOMBAY HIGH COURT - [2015] 375 ITR 483 (Bom) - Validity of prima facie conclusions of the Settlement Commission - bogus purchases - revenue alleges that the disclosure was not full and true - order of the Settlement Commission not declaring the application of the Assessee firm as invalid under section 245D (2C) - Held that:- The Commission has recorded by a majority that disclosure of additional income at this stage appears to be prima facie full and true and at present there .....

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come. It does not wish to express a final opinion on the adequacy of disclosure.

Thus, the disclosure is not termed to be untrue and incomplete. What is held is whether the disclosure as made is adequate and complete would require detailed examination. A disclosure is termed as true and full but a difference in the perception of the Assessee and the Revenue has been noted. Equally, the Commission did not ignore the reports of the Commissioner as complained. There is a reference to it .....

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t the statement of the two bank accounts, it is not possible for the Commission to quantify the additional income as it has a direct bearing on the cash deposits made by the Assessee in the bank accounts. His contrary reasoning in para 7 of the order at pages 86 and 87 has been noted by us above. It is in these circumstances that we do not find the reliance placed by Mr.Chhotaray on the Judgment of the Division Bench to be well placed.

The view that we have taken, it is not necessary .....

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ondent : Mr. J. D. Mistri Senior Advocate with Mr. Nishant Thakkar i/b. M/s. Haresh Mehta and Co. JUDGMENT ( Per S. C. Dharmadhikari) 1) Rule. Respondents waive service. By consent of the parties, Rule made returnable forthwith. 2) By this Writ Petition under Article 226 of the Constitution of India, the Petitioner has prayed for issuance of a writ of certiorari or writ in the nature of certiorari or any other appropriate writ, direction or order to quash and set aside orders passed on 26th Marc .....

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ry scheme. This statutory scheme is evolved within the framework of the Income Tax Act, 1961 (hereinafter referred to as the IT Act ). We shall make a reference to this scheme a little later. 4) From the record, it appears that in the assessment year 2010-11, a scrutiny assessment was undertaken, in which it was noticed that the second Respondent (for short the Assessee ) had purchased materials/goods from various parties. Some parties, whose names appeared in the list, were suspicious. It is al .....

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m one such party, namely, M/s. Nutan Metals, information under section 133(6) of the IT Act was called for but the said notice was returned back. However, on 12th February, 2013, one Shri. Panchanmal Bokadia Proprietor of M/s. Nutan Metals made a statement before the Assessing Officer confirming that the said M/s. Nutan Metals issues bills for earning commission without giving delivery of goods. Accordingly, the Assessing Officer determined the highest credit balance at ₹ 28,09,288/as appe .....

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9-10. In a statement before the Income Tax Officer (Intelligence and Criminal Investigation) II, Mumbai, Shri. Mahendra S. Vora admitted that the deposits in the bank account did not pertain to him but to the Assessee firm. Further, statement of Shri. Rasiklal M. Morakhia, partner in the Assessee firm was also recorded on the same day and the said Shri. Rasiklal M. Morakhia admitted that these deposits pertained to the Assessee firm and did not pertain to Shri. Mahendra S. Vora. The Assessing Of .....

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omputerized system of the Department (AST) was also made on 18th March, 2013 itself. 8) For assessment year 2011-12, a notice under section 148 was issued on 15th March, 2013 and it was served on the Assessee firm on 18th March, 2013. Thus, both, the assessment for assessment year 2010-11 and the notice under section 148 for assessment year 2011-12 have been deemed to be served/served respectively on the Assessee firm before the Assessee filed application before the Settlement Commission under s .....

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n by the Assessee had been detected by the Income Tax Department for all the years, namely, assessment year 2010-11 to 2012-13 and also that concealed income in the form of cash deposits had been detected by the Department, filed a settlement application for assessment years 2010-11 to 2012-13 on 18th March, 2013 under section 245C of the IT Act. In this settlement application, additional income was declared as follows: Assessment Year 2010-11 1,05,25,216/ Assessment Year 2011-12 8,97,111/ Asses .....

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hearing under section 245D(1) of the IT Act on 22nd March, 2013, all the relevant facts were before the Settlement Commission. The Commission was requested to take a considered view in the matter but all these were simply brushed aside and not even have been commented upon in the order of the Settlement Commission passed under section 245D(1) of the IT Act. The settlement application made under section 245C of the IT Act was allowed to be proceeded with vide order dated 26th March, 2013 passed .....

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t was brought to the notice of the Settlement Commission that there was no pending assessment for assessment year 2010-11, as the assessment order was already issued before the filing of the settlement application under section 245C of the IT Act. Further, notice under section 148 for assessment year 2011-12 was also served on the Assessee firm before the Assessee filed the application before the Settlement Commission under section 245C of the IT Act. Hence, for both these assessment years, the .....

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uch more than the undisclosed income declared by the Assessee firm. It was pointed out to the Settlement Commission that even the copies of the detected bank accounts were not submitted by the applicant in the application for settlement and thus, the application did not disclose relevant crucial material facts. Hence, the Assessee firm had not fulfilled one of the main requirements for availing the jurisdiction of Settlement Commission under section 245(1), which was to make a full and true disc .....

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aside the case of the Petitioner. The order of the Settlement Commission dated 10th May, 2013 not declaring the application of the Assessee firm as invalid under section 245D (2C) of the IT Act is woefully silent on the objections raised by the Petitioner. The Settlement Commission, in its order passed under section 245D (2C), in its majority view, merely agreed with the Assessee firm by holding that the matter had not reached finality as yet and as such it was debatable whether the issues and .....

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taray learned Counsel appearing for the Petitioner submitted that the matter involves three assessment years, namely, 2010-11, 2011-12 and 2012-13. He submits that an assessment order was passed for assessment year 2010-11, in which, it was disclosed that the Assessee firm is engaged in the business of trading in ferrous and nonferrous metals. It consist of three partners, namely Sevantilal M. Morakhia, Rasiklal M. Morakhia and Ashok M. Morakhia. Rasiklal M. Morakhia has 34% shares in the profit .....

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s plates etc. In order to verify the genuineness of purchases, notices were issued under section 133(6) of the IT Act to the two parties, namely Nutan Metals and Mumbai Metals. Notices were issued on 9th January, 2013. Mumbai Metals gave a written reply/submission on 23rd January, 2013 and filed copy of Ledger Account of M/s. Rasiklal Kantilal and Company and its own return of income, which was filed for assessment years 200910 and 2010-11. It stated that there was no transaction with M/s. Rasik .....

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th the proprietor of M/s. Nutan Metals. The summons was issued and served on the proprietor of Nutan Metals and Mr. Chhotaray relies upon the answers given by this person to some of the questions posed during the course of assessment proceedings. Mr.Chhotaray relied upon para 5.3 of the assessment order to urge that if the Assessee fails to substantiate any expenditure debited to the trading/profit and loss account with adequate supporting evidence and by establishing the genuineness of the purc .....

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T Act. Further, notice under section 148 of the IT Act for assessment year 2011-12 was also served on the Assessee firm before the Assessee filed the application. The pendency of proceedings under the IT Act is a sine qua non for the admission of the application before the Commission. Thus, when a notice had been served and assessment order has been passed for two assessment years referred above, the Settlement Commission had no jurisdiction to accept the application. Mr. Chhotaray criticised th .....

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ct. According to Shri. Chhotaray, this would indicate as to how the Assessee indulged in manipulation of accounts. There was no genuine business activity and the alleged purchases were not backed by strong and reliable evidence. These are accommodation entries and as deposed by the concerned persons during the assessment proceedings. Shri. Mahendra S. Vora has admitted the fact that the details were bogus and were sufficient to accommodate parties like the Assessee. 14) Mr. Chhotaray then submit .....

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spondent No. 2 under section 245C of the IT Act was not maintainable. The Respondent No. 2 has admitted and owned up the two undisclosed bank accounts. He had admitted the entries reflected in these bank accounts as far as capital and profit from the undisclosed trading. He offered the amounts to tax. However, copies of the accounts did not form part of the settlement application. The disclosure of undisclosed income for assessment year 2010-11 of ₹ 1,05,25,216/, of ₹ 8,97,111/for as .....

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making sales to the Assessee and that all this was known to the Department was also hidden by Respondent No. 2 from the Settlement Commission. This entire material was brought before the Settlement Commission together with supporting documents. There is also a copy of the assessment order, wherein the partner of Respondent No. 2/Assessee's admission was recorded on 1st February, 2013. This was also not in the application filed before the Settlement Commission. It is apparent from the procedu .....

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section 245D(2B) of the Commissioner to the Settlement Commission, the Commissioner had also highlighted that the Assessee had not made a full and true disclosure of its income in the settlement application. Along with his communication dated 19th March, 2013, the Commissioner had also enclosed a copy of the assessment order dated 18th March, 2013 passed by the Assessing Officer. The above two reports may kindly be perused. Two preconditions should be satisfied before proceeding with the settle .....

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de a full and true disclosure of its income and the manner of earning such income. 16) The Settlement Commission was apprised of the bogus purchases by these two communications of the Commissioner to the Settlement Commission, namely, the communication dated 19th March, 2013 and the report under section 245D(2B) of the IT Act. It was also argued during the hearing before the Settlement Commission. Therefore, the Settlement Commission had material before it to hold that the Assessee had not made .....

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e Commissioner and at the hearing about these bogus purchases before it considered the applications for passing the orders under sections 245D(1) and 245D(2C). Still it held by a majority view that full and true disclosure has been made. As rightly held by the third dissenting Member, the Assessee had not made a full and true disclosure of income and the manner of earning the income. 18) In support of the above contentions, Mr. Chhotaray relies upon the following decisions: 1 (1979) 4 SCC 121 in .....

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n Writ Petition No. 3990 of 2013 dated 13th June, 2013 passed by a Division Bench of this Court in the case of Commissioner of Income Tax (Central), Pune vs. Income Tax Settlement Commission (ITSC), Additional Bench, Mumbai. 19) On the other hand, Mr. Mistri learned Senior Counsel appearing for the original Applicant/Respondent No. 2 Assessee submits that the Writ Petition has no merit and must be dismissed. This Court cannot substitute its views with that of the Settlement Commission unless it .....

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made was adequate and sufficient for the purpose of admitting the Assessee's application. Such tentative and prima facie view should not be interfered in the Writ Jurisdiction, as that would result in complete failure of the Settlement mechanism. Mr.Mistri then submitted that the entire matter proceeds on a misconception that the Settlement Commission, while admitting an application, is obliged to go into and consider minute details and the controversy or issue on merits. In the present cas .....

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re initiated unmindful of any assessment order. The application was filed on 18th March, 2013. The circumstances in this regard have been narrated in the affidavit in reply. It is urged that the requisite details have been disclosed in the application. The declaration is truthful and honest. In any event, the Settlement Commission is obliged to decide the matter in accordance with law. When the matter proceeds further, the Revenue can point out to the Settlement Commission that on the basis of t .....

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ts set out in law. If the statutory requirements are not complied with, then, the Settlement Commission must dismiss the application at the threshold. In the present case, the Settlement Commission has erred in not noticing the fact that the assessment order is already passed and served on the Assessee. Secondly, the disclosure as made is not enough and in law for enabling the Settlement Commission to entertain the application/admit it. In the present case, Respondent No. 2 did not include the b .....

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s of the Petitioner. It is pointed out that between 4th February, 2013 and 15th March, 2013, Respondent No. 2 has paid income tax in the sum of ₹ 66,28,053/. The breakup of the same is given in para 7, at page 94 of the paper book. It is specifically stated that till 15th March, 2013, no notice was received by Respondent No. 2 for either of the three assessment years, namely, 2010-11, 2011-12 and 2012-13. It is stated that on 15th March, 2013, the second Respondent firm paid the sum of  .....

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ed 12th March, 2008 issued by the Central Board of Direct Taxes (CBDT), it is urged that the service of the Assessment Order is the crucial and relevant aspect of the matter. Then, there is a grievance made as to how the Assessing Officer, who was supposed to have acknowledged a receipt of the application for settlement, sought to force the Assessee to accept a notice under section 148 of the IT Act. It has been stated and in this paragraph as to how the Commission acted on receipt of the applic .....

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ccept the notice under section 148 of the IT Act as alleged in the affidavit in reply. Therefore, Mr. Mistry would submit that this is a case where none of the submissions and canvassed on behalf of the Petitioner deserve to be accepted. It is urged that there is no merit in the Writ Petition and it deserves to be dismissed. 23) With the assistance of the learned Counsel appearing for both sides, we have perused the Writ Petition and its all Annexures and the affidavits placed on record. 24) At .....

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is case has analysed the entire chapter and held as under:Page ..... It is no doubt true that the terminology settlement has a very wide dictionary meaning and in the absence of a statutory definition generally the word settlement in subsection (4) of section 245D would give the Commission sufficient power to arrive at a settlement which it deems fit, but when the statute qualifies such expression like settlement with mandatory words like in accordance with the provisions of this Act the width o .....

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e provisions of Part F of Chapter XVII and Chapter XIX and Chapter XIXA, we would hold that it would not in any manner empower the Commission to either waive or reduce interest which is statutorily payable under the provisions of Part F of Chapter XVII. 26) The observations that Mr. Chhotaray relies upon and at page 15 of this report indicate that the intention of the legislature in introducing this section is to see that protracted proceedings before the authorities or in Courts are avoided by .....

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e writ jurisdiction under article 226 of the Constitution of India while examining the order of the Settlement Commission? Broadly speaking an essential feature of the writ of certiorari is that the control which is exercised through it over judicial or quasi-judicial bodies is not in an appellate but supervisory capacity. One consequence of this is that the court will not review findings of fact reached by the inferior court or Tribunal, even if they be erroneous. A writ of certiorari can be is .....

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error apparent on the face of the record. Whether there is an excess exercise of jurisdiction may depend upon the existence of some facts in each case. There are cases where jurisdiction of the inferior Tribunal depends upon fulfilment of some conditions precedent upon existence of some particular fact. Such a fact is collateral to the actual matter, which the inferior Tribunal has to try and determine. Whether it exists or not is logically and in sequence prior to the determination of the actu .....

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eme of Chapter XIXA of the Act then it would be clear that the said Chapter was inserted by the Taxation Law (amendment) Act, 1975, with effect from April 1, 1976. Provisions more or less similar to it contained in subsections (1A) to (1D) of section 34 of the Indian Income-tax Act, 1922, were introduced in 1954. The provisions of Chapter XIXA were, however, qualitatively different and more elaborate than the said provisions in the 1922 Act. The said Chapter thereafter went through a number of c .....

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merated while taking stock of the legislative provisions in this behalf. Section 245L of the Act declares that any proceeding under this Chapter before the Settlement Commission shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 and for the purposes of section 196 of the Indian Penal Code. When it is declared to be a judicial proceeding, the prescribed procedure has to be followed. ….. 27) These principles, therefore, would guide us in deciding whether .....

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respect of any assessment year or assessment years which may be pending before an Assessing Officer on the date on which an application under subsection (1) of section 245C is made. The application for settlement of case is contemplated by section 245(1) and which provides that an Assesse may, at any stage of a case relating to him, make an application in such form and in such manner as may be prescribed, and containing a full and true disclosure of his income which has not been disclosed before .....

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ed to in clause (b) of subsection (1) of section 153A or clause (b) of subsection (1) of section 153B in case of a person referred to in section 153A or section 153C have been initiated, the additional amount of income tax payable on the income disclosed in the application exceeds fifty lakh rupees, and in a case where sub-clauses (A) and (B) of clause (ia) of the proviso is attracted or where clause (ii) of the proviso is attracted. Upon receipt of this application, the Commission has to deal w .....

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ication shall be deemed to have been allowed to be proceeded with if the additional tax on the income disclosed in such application and the interest thereon is paid on or before the 31st day of July, 2007. Explanation. In respect of the applications referred to in this subsection, the 31st day of July, 2007 shall be deemed to be the date of the order of rejection or allowing the application to be proceeded with under subsection (1). (2B) The Settlement Commission shall, (i) in respect of an appl .....

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the receipt of communication from the Settlement Commission. (2C) Where a report of the Principal Commissioner or Commissioner called for under subsection (2B) has been furnished within the period specified therein, the Settlement Commission may, on the basis of the report and within a period of fifteen days of the receipt of the report, by an order in writing, declare the application in question as invalid, and shall sent the copy of such order to the applicant and the Principal Commissioner o .....

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, 2007 and an order under the provisions of subsection (1) of this section, as they stood immediately before their amendment by the Finance Act, 2007, allowing the application to have been proceeded with, has been passed before the 1st day of June, 2007, but an order under the provisions of subsection (4), as they stood immediately before their amendment by the Finance Act, 2007, was not passed before the 1st day of June, 2007, such application shall not be allowed to be further proceeded with u .....

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act that section 245C of the Act is meant for those Assessees who seek to disclose income not disclosed before the Assessing Officer including the manner in which such income has been derived, as the Hon'ble Supreme Court held in the case of Commissioner of Incometax vs. Express Newspapers Ltd. reported in (1994) 206 ITR 443 that Chapter XIXA is a part of the Income Tax Act and must be construed consistent with the overall scheme and object. Thus, it is to enable those Assessees who want to .....

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the Chapter. We are also aware of and have perused carefully the observations of the Hon'ble Supreme Court in a Judgment in the case of Commissioner of Income Tax vs. B. N. Bhattacharjee and Anr. reported in (1979) 4 SCC 121. We are not deviating from the principle that the Commission has to ensure that the Settlement is fair, prompt and independent. It must not enable those who wish to evade taxes or avoid the consequences following the same as provided by law and particularly by the IT Ac .....

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question and finds that for assessment year 2010-11 notice under section 143(2) of the IT Act was issued on 29th September, 2011. Thus, it found that the returns of income for the subject assessment years were filed and the proceedings are pending from April, 2011, September, 2011 and April, 2012 for the respective assessment years. For assessment year 2010-11, the notice under section 143(2) was issued as above, but the Assessee's representative pointed out that the Assessing Officer passe .....

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nth of January, 2012 emphasising that though the assessment order was claimed to have been passed on 18th March, 2013, it cannot be said to have been made in terms of the provisions relating to the admission of the application, because it is not served on the Applicant. Thus, reliance was placed on the definition of the term 'case' as set out in section 245A(b) of the IT Act. Thus, it was asserted that proceedings for assessment under the Act in respect of the assessment years in questio .....

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s on 20.03.2013. From the above facts it is clear that although the dispatch of the assessment order has been done on 18.03.2013 (the date on which assessment order was passed), the service to the applicant was not made by 18.03.2013. If the refusal is to be accepted as service then the earliest service is on 19.03.2013. Alternate plea of the AR that the applicant be debarred for making the application in the circumstances only w.e.f. 19.03.2013 onwards has also got considerable force. The deliv .....

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that the service was refused but after the date on which the application for settlement was presented and filed before the Commission. It is the conclusion of the Commission that delivery of the envelope to the postal authorities cannot be termed as service. We do not find, therefore, any force in the contention of Mr.Chhotaray that the assessment order having been served, the proceedings for the assessment year, namely, 2010-11 were not pending. We are not required to consider any larger contr .....

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the arguments of the Assessee's representative that the effective date of commencement of the reassessment proceedings and which would debar the second Respondent from approaching the Settlement Commission needs consideration. He submitted that the explanation for the purpose of clause (b) of section 245A(i) refers to proceedings for reassessment and they shall be deemed to have commenced from the date on which a notice under section 148 is issued. The argument before the Commission was that .....

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der section 148 of the IT Act dated 15th March, 2013 has been served on the Assessee on 18th March, 2013, which is the date of filing the application before the Commission. Even with regard thereto, the Assessee's representative argued that there could not have been any reassessment proceedings where the time limit to issue notice under section 143(2) still exists and assessment is not barred by limitation. However, for our purpose, we need not dwell on this aspect in further details, as we .....

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year 2011-12 has been served on 18th March, 2013 and therefore proceedings for that assessment year are not pending. However, for assessment year 2012-13, he has without referring to para 7 of the majority view agreed with it that the application is maintainable and can be admitted. Thus, on when same facts he holds that proceedings for assessment year 2011-12 are not maintainable, he ought to have agreed with the majority for both years, namely, assessment year 2011-12 and assessment year 2012- .....

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o into any wider controversy once again, but the understanding of the dissenting member of section 27 of the General Clauses Act, 1897 leaves a lot to be desired. While it is true that the statement of the addressee that the notice was not served on him by the post may not in every case be enough to rebut the presumption, but it must be established that where any Central Act or Regulation made after the commencement of the General Clauses Act, 1897 authorises or requires any document to be serve .....

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is not complete on mere dispatch of the notice and further that the word 'issued' is also used in the same sense as 'served'. All this has been emphasised by the Hon'ble Supreme Court in several decisions and for illustration, we refer to Judgments of the Hon'ble Supreme Court in the cases of K. Narasimhiah vs. H. C. Singri Gowds and Ors. Reported in AIR 1966 SC 330, R. K. Upadhyaya vs. Shanabhai P. Patel reported in AIR 1987 SC 1378, and V. Raja Kumari vs. P. Subbarama N .....

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arch, 2013 is said to have been issued and served on the second Respondent on 18th March, 2013, but reliance is placed on the word 'issued' and thereafter to construe it as 'served'. There is a considerable debate about this and once the dissenting Member also has found that the application for settlement is partially admissible, then, all the more we are not inclined to interfere with the majority view. The majority view as is found to be recorded and accepting the Assessee' .....

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worked out on the basis of the entries in these accounts have been accepted by the second Respondent and he has set out the manner of earning as well as made true and full disclosure of income. In paragraph 11 of the order of the majority at page 65 of the paper book this is what is held: 11. We have carefully considered the application as well as submissions made by the AR. We find that the conditions regarding threshold limit for the quantum of tax on additional income, payment of tax and inte .....

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facie full and true and at present there is no material to reject the contention of the applicant company. This aspect would require detailed examination in the subsequent proceedings before us and, therefore, is left open. 37) However, we do not find that the dissenting member has specifically made any comment on the above in his first note dated 26th March, 2013 (see page 66 and 67) 38) Mr. Chhotaray would submit that there is no disclosure much less true and full. In the oral arguments as al .....

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he alleged vendor stated that he had not sold any material to the second Respondent but lent only his name for the commission. Mr.Chhotaray heavily relied upon the Assessing Officer's observations and findings in the assessment order. Though the Assessee/Respondent No. 2 before us has made a statement to the contrary, yet, Mr. Chhotaray submits that the Settlement Commission was apprised of bogus purchases by two communications of the Commissioner and in that regard he relies upon Annexures .....

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ority recorded, we were referring to the dissenting note at pages 66 and 67 of the paper book. 39) At annexure 'J' is a copy of the order dated 10th May, 2013. This order is passed after the settlement application was allowed to be proceeded with and a report was called for under section 245D (2B) of the IT Act. Thus, it is a post admission order and traceable to section 245(2C) of the IT Act. However, from pages 82 and 83, we find that there is a reference made to the arguments of one P .....

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e of these two bank accounts, it is not possible for the Commission to quantify the additional income. Then, he refers to the source of generation of cash which was the core issue for making declaration of additional income before the Commission. The Assessee has allegedly not confirmed the manner in which the additional income was earned. It is in these circumstances that the requirement of full and true disclosure is held to be not satisfied and for all three years. We do not find how this cou .....

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full and true disclosure and in regard to the income and the manner in which it is generated is not satisfied or fulfilled by the Assessee. How that finding can be common for all three assessment years. More so, when for one assessment year the findings are that there is already an assessment order made and duly served, and secondly, there is a notice under section 148 of the IT Act issued and which must be construed as served for the assessment year 2011-12. Hence, this contradiction in the opi .....

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e disclosure of additional income at the stage at which the application was brought before it appears to be prima facie full and true. However, this aspect would require detailed examination in the subsequent proceedings and is left open. Thus, the Commission was not required to give a definite and conclusive finding at the threshold. Suffice it to hold that once it has come to the above conclusion, then, we are not required to go any further. We clarify that all observations by the majority, th .....

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o hand over a compilation. One compilation contains the application and the Annexures, and the second is the confidential part. He terms the first part as open part and the second as confidential part. A scrutiny of the open part reveals how the Assessing Officer having probed the matter(page 169), there is a reference to the bank account in the name of Mahendra Shantilal Vora in Dena Bank, Gulalwadi, Mumbai. The date of opening and how the account was operated by Mahendra Vora for his personal .....

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e Settlement Commission. The detailed modus operendi including the manner in which the Assessee has not disclosed the income before the Assessing Officer is set out in the confidential portion. It is on this basis and such material that the majority concluded that the requirement of full and true disclosure is satisfied. We are satisfied that the Settlement Commission performed its function and upon scrutiny of the relevant materials rightly concluded that prima facie the disclosure as made is t .....

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e are of the view that any exercise of this nature would prejudice the case of both sides and it is even otherwise impermissible in our limited jurisdiction. We do not decide disputed questions of fact nor we substitute ourselves as the Settlement Commission. For, both courses are not permissible in law and to be carried out in our limited jurisdiction. In these circumstances, we have no hesitation in rejecting the contentions of Mr. Chhotaray on the third aspect of the matter. 43) The case law .....

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he Commission passed an initial order on 27th September, 2012 under section 245D(1) of the IT Act allowing the application to be proceeded with and thereafter the Commissioner was called upon to furnish a report, inter alia, on the validity of the application filed for the relevant years, the correctness and adequacy of additional taxes and interest paid by the Applicant and on compliance by the Applicant. That report was submitted on 15th October, 2012 and the Commission passed an order under s .....

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uch circumstances, the Division Bench concluded that the jurisdictional requirements have to be satisfied, else the Commission cannot proceed and in accordance with law. The object of setting up the Commission and the provisions has therefore been extensively referred in paras 10 and 11. The Division Bench concluded that for the application to be maintainable, the disclosure must be full and true. Till para 19, the provisions of law have been referred and analysed. In para 20, the conclusion of .....

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ection 245D of the IT Act. Thus, para 20 is heavily relied upon by Mr. Chhotaray. 45) However, the distinction lies in the fact that in the present case, the Commission has recorded by a majority that disclosure of additional income at this stage appears to be prima facie full and true and at present there is no material to reject the contentions of the second Respondent. However, this would require detailed examination in the subsequent proceedings and therefore, it is left open. We also find t .....

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is adequate and complete would require detailed examination. A disclosure is termed as true and full but a difference in the perception of the Assessee and the Revenue has been noted. Equally, the Commission did not ignore the reports of the Commissioner as complained. There is a reference to it and the contentions of the Revenue qua them in the order dated 10th May, 2013. Thus, all statutory requirements and conditions are complied with. The admission of the Assessee's application for settl .....

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nts. His contrary reasoning in para 7 of the order at pages 86 and 87 has been noted by us above. It is in these circumstances that we do not find the reliance placed by Mr.Chhotaray on the Judgment of the Division Bench to be well placed. 46) We have not deviated in any manner from the principles laid down in the Judgment of the Hon'ble Supreme Court in the case of Anjum M. H. Ghaswala (supra). Equally we have not deviated from the principles in the case of B. N. Bhattacharjee and Anr (supr .....

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ly to satisfy the requisitions given by the Commission. There was compliance with that direction, but not satisfactorily. The Commission found most of the documents to be a heap of irrelevance. Three months' time was given to furnish the details in respect of the various requirements of the Commission as had been indicated to the Appellant. The Appellant then left the precincts of the Settlement Commission, to pursue a path of confrontation and contest by other remedies. The Settlement Commi .....

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