2018 (8) TMI 1788 - HC - Income Tax

Application for settlement u/s 245C(1) - Is an applicant, who files an application covering more than one assessment years, before the Commission required to disclose additional income for each of the assessment years? - Whether such additional income must result in the liability to pay income tax for each of the assessment years? - HELD THAT - We have entertained this petition as the impugned order has been passed under Section 245BA(5A) i.e. on constitution of the Special Bench by the chairperson of the Commission and concerning the jurisdiction of the Commission. The very fact that a Special Bench of the Commission had to deal with the issue would by itself warrant consideration. This petition raises identical / similar issue as arising in the case of Betul Oil Ltd. Vs. The Settlement Commission 2017 (4) TMI 124 - BOMBAY HIGH COURT which is already admitted and its hearing has been expedited. In the above view, this petition is to be tagged along with Betul Oil Ltd. for final hearing. Petitioners seek liberty to amend the petition by adding the interveners, who appeared before the Special Bench leading to the impugned order dated 2nd December, 2016, as party respondents in this petition. Liberty granted. Amendment to be carried out within a period of 4 weeks from today as prayed for by the Revenue. The amended copy to be served upon all the respondents including the newly added respondents immediately after carrying out the amendment.

Summary

Issues:
Challenge to order of Income Tax Settlement Commission on disclosure of additional income for multiple assessment years and liability to pay income tax.

Analysis:
The petition challenged the order of the Income Tax Settlement Commission regarding the disclosure of additional income for multiple assessment years and the liability to pay income tax. The Special Bench of the Commission was constituted under Section 245BA(5A) of the Income Tax Act, 1961. The main question before the Special Bench was whether an applicant filing an application covering more than one assessment year must disclose additional income for each year and whether such additional income must result in the liability to pay income tax for each year. The impugned order directed the application of M/s. Neptune Group to be disposed of by the Regular Bench under Section 245D(1) of the Act after assessing these two issues.

After the Special Bench's order, the Regular Bench of the Commission disposed of the Settlement Application filed by respondent nos. 2 to 5. The petitioner's counsel stated that the Revenue was aware of the order passed under Section 245D(4) of the Act but was instructed to press this petition. The petition was entertained as it raised jurisdictional issues concerning the Special Bench's constitution by the chairperson of the Commission. The petition raised similar issues as in another case already admitted, and the hearing was expedited, leading to the decision to tag this petition along with the other for final hearing.

The petitioner's counsel sought permission to amend the petition by adding interveners who appeared before the Special Bench as party respondents. The request was granted, with a deadline of four weeks for the amendment. The petition, along with the other case, was scheduled for final hearing and disposal on a specified date agreed upon by the parties, allowing for a comprehensive review of the issues raised regarding the disclosure of additional income and the liability to pay income tax for multiple assessment years.