2020 (2) TMI 997 - SC - Income Tax

Settlement commission order - additional income which was disclosed during the course of the hearing - HELD THAT - The nature and extent of delay and the issues involved, we are of the view that it would be appropriate and proper, in the interests of justice, for the writ petition to be heard on merits by the High Court, subject to payment of costs, which would be a condition precedent. The High Court ought not to have dismissed the petition on the ground of delay. The appellant raises issues which are worthy of consideration on merits. We accordingly order and direct that conditional on the appellant paying a sum quantified at ₹ 3,00,000 to the second respondent, by way of costs, withing a period of six weeks from today, the judgment and order of the High Court 2018 (8) TMI 577 - BOMBAY HIGH COURT shall stand set aside and the writ petition shall stand restored to the file of the High Court for disposal on merits. In the event that the appellant fails to pay the costs, as directed, the benefit of this order shall not be available.

Summary

Issues involved:
Delay condonation, dismissal of writ petition by High Court on grounds of delay, jurisdiction of Settlement Commission, additional income disclosure, fairness in condoning delay, payment of costs, setting aside High Court's order.

Analysis:
The Supreme Court addressed the issue of delay condonation and dismissal of a writ petition by the High Court in a case challenging an order of the Income Tax Settlement Commission. The High Court had dismissed the petition due to delay in filing. The appellant relied on legal precedents to argue that serious issues required consideration by the High Court. The appellant contended that the disclosure made initially was not true, full, and complete, affecting the Settlement Commission's jurisdiction. The respondent, on the other hand, justified the Settlement Commission's order on merits, stating that the additional income disclosed during the hearing was part of the discussions before the Commission.

The Court, after considering the submissions, found it appropriate for the writ petition to be heard on merits by the High Court, subject to the payment of costs by the appellant. The Court criticized the High Court's dismissal of the petition solely based on delay and emphasized that the issues raised by the appellant deserved consideration. Consequently, the Supreme Court set aside the High Court's order and restored the writ petition for disposal on merits, contingent on the appellant paying a specified sum as costs within a stipulated period. Failure to comply with the cost payment would nullify the benefit of the Court's order.

In conclusion, the Supreme Court allowed the appeal, highlighting the importance of addressing the issues raised by the appellant on merits and ensuring fairness in the legal proceedings.