9911796707
TMI Blog1997 (5) TMI 394X X X X Extracts X X X X X X X X Extracts X X X X ..... the settlement application in respect of the assessment years 1981-82 to 1983-84, 1985-86, 1988-89 and 1989-90, and their consequences, be annulled particularly in the context of the Supreme Court s observations in Express Newspapers case [1994] 206 ITR 443, 458A. III. What would be the just and proper course of action at this juncture in regard to the request for invoking section 245E in respect of the assessment years 1981-82, 1982-83, 1983-84, 1985-86, 1988-89, 1989-90 and 1990-91 ? The matter arose in the course of hearing under section 245D(4) of the Act in the case of . . . . Counsel for the applicant vide letter dated December 18, 1996, requested for constitution of a Special Bench which could examine and interpret the true scope and meaning of the expression for the proper disposal of the case pending before it, it is necessary or expedient to reopen any proceeding connected with the case but which has been completed under this Act as appearing in section 245E of the Act. The facts of the case, in brief, are as under : (a) On February 20, 1991, the Income-tax Department carried out search and seizure operations in the business and residential premises of the appl ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lakhs, unexplained investment at Rs. 72.50 lakhs and unexplained money of Rs. 26,58,120 totalling Rs. 5,94,82,660. To the determined income in respect of each of the above noted years, the Assessing Officer added penalty under section 271(1)(c) as computed by him and came to the conclusion that as the total tax and other liabilities of the assessee determined are more than the value of the assets seized and belonging to the assessee he was retaining such seized assets. (d) On June 26, 1991, the applicant filed a return of income for the assessment year 1991-92. In the return the applicant had declared a total income of Rs. 4,06,00,010 in which was included the disclosed income under section 132(4) computed as under, as per the statement filed with the return : Addl. income declared under section 132 read with Explanation 5 to section 271(1)(c) of the Income-tax Act, 1961, as per letter dated March 5, 1991, addressed to the ADI, Unit-I(4), and also letter dated May 15, 1991, in the course of assessment proceedings 4,85,74,540 Less: Income considered by the Assessing Officer vide his order under section 132(5) dated June 19, 1991, representing for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n respect of the full and true statement of facts regarding the issues to be settled, including the terms of settlement sought for by the applicant , it was stated as under : A search was conducted at the residence and office premises of the applicant under section 132(1) on February 20, 1991. In the course of search a disclosure for the assessment year 1991-92 of Rs. 4,85,74,540 was made by the applicant under section 132(4) of the Income-tax Act, 1961, read with Explanation 5 to section 271(1)(c) of the Income-tax Act, 1961. The Assessing Officer has in his order under section 132(5) taken the view on the basis of material seized in the course of the search that a further income of Rs. 87,71,490 is assessable in the earlier assessment year. The issue to be settled is whether the said income of Rs. 4,85,74,540 is to be assessed in its entirety for the assessment year 1991-92 or any income is to be assessed for the earlier assessment years as decided by the Assessing Officer in his order under section 132(5) dated June 19, 1991, as under : Assessment year Amount (Rs.) 1981-82 6,83,000 1982-83 2,32,000 1983-84 10, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing out the said rectification by the Assessing Officer, the applicant filed an appeal before the Commissioner of Income-tax (Appeals) CentralIV, Mumbai. The Commissioner of Income-tax (Appeals) directed the Assessing Officer to entertain the rectification application made by the appellant-assessee under section 154 favourably by deleting the addition of Rs. 87,71,490 . Thereafter, the Assistant Commissioner of Income-tax, Central Circle-XVIII, Mumbai, filed an appeal before the Income-tax Appellate Tribunal on February 11, 1994. The matter is pending before the Income-tax Appellate Tribunal. As regards assessment years 1981-82 to 1983-84, 1985-86, 1988-89 and 1989-90, the reassessment proceedings have been completed under section 143(3) read with section 147. These assessments except for the assessment year 1983-84 were completed on March 8, 1994. The assessment for the assessment year 1983-84 was completed on February 28, 1994. These assessments were reopened under section 147 and notices under section 148 were issued even before the application under section 245C(1) was admitted by the Commission under section 245D(1) for the assessment year 1991-92 vide order dated December ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ome-tax (DR) during the course of the hearing, we take note of the following facts : (a) The applicant made a statement under section 132(4) on February 23, 1991, and confirmed the same by a written statement on March 5, 1991, that he had earned Rs. 4,85,75,540 out of speculation, etc., during the assessment year 1991-92. (b) The order under section 132(5) dated June 19, 1991, took into account the speculation income of Rs., 4,85,74,540 as disclosed under section 132(4) for the assessment year 1991-92 in addition to other income for that year. It also took into account unexplained investments, unexplained expenses and interest earned by the applicant in the assessment years 1981-82 to 1983-84, 1985-86, 1986-87 and 1988-89 to 1990-91. The income element thereof was included in the computation along with the penalty amounts to estimate the income and income-tax thereon with a view to retain the seized assets. It is, therefore, to be noticed that the income estimated for the said years did not form part of the speculation income of the applicant as disclosed by him for the assessment year 1991-92. (c) The applicant filed an application under section 245C(1) for the assessment ye ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g assessment year 1986-87 for which a separate application was filed, showing additional income, over that offered in the application for the assessment year 1991-92, as noted at paragraph 5(f) above (page 47 supra). Statement showing break up of the amount disclosed under section 132(4) read with Explanation 5 to section 271(1)(c) of the Income-tax Act, 1961, based on various assets found and seized including the entries in all the loose papers, etc., found and seized in pursuance of action under section 132(1) dated February 20, 1992, from office at . . . Rs. Rs. Total amount of disclosure : 4,85,74,540 Break up of the same : 1. Jewellery seized 85,34,309 2. Silver utensils 2,75,280 3. Renovation, etc. 4,00,000 4. Artefacts and electronics 2,75,000 5. Cash (49,81,200 + 50,000) 50,31,200 6. Indra Vikas Patra 26,00,000 7. Tungarli Project Investment 76,78,500 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ,42,000 16. Disclosure not covered by any of the loose papers, etc., but made by way of abundant caution 39,17,443 Total 4,85,74,540 As their Lordships of the Supreme Court in the matter of CIT v. Express Newspapers Ltd. [1994] 206 ITR 443, have held at page 456 that the filing of an application by the assessee is a unilateral act and the Department may not be aware of the same the inexactitude in the disclosures made in the settlement applications filed for different years by the applicant is to be considered accordingly. In parenthesis, we need not detain ourselves in any further analysis of the disclosures made. Suffice it to say that the Additional Bench of the Commission at Mumbai shall deal with the quantification of income in its orders under section 245D(4). Shri S. E. Dastur, Advocate, representing the applicant in this case initiated the debate. He took us through the factual background in view of the peculiar facts of the case. Reference was made to the order of the Commission under section 245D(1) dated December 13, 1991, in particular, the reasons recorded while admitting the application to be proc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... be settled and the manner in which the additional income disclosed was derived, etc. These facts are elaborately recorded at para 3 (at page 43) of this order. It is stated that at the time of hearing for admission before the Commission the issues to be settled at item 10 of the application were specifically brought to the notice of the Commission. In short, the plea was that the issues to be settled concerned whether the disclosures made under section 132(4) for the assessment year 1991-92 were to be assessed in the said year or part of these were to be assessed in the earlier years as per the view taken in the order under section 132(5). Further, reference was made to item 11 of the application in which details were given as to the quantum of income in other years, to the extent specified in the order under section 132(5), which could be considered for assessment in those years by invoking the provisions under section 245E. We may, however, note here that this matter could not have been discussed in the open court as this was part of the confidential enclosure. It is also brought to our notice that the Commissioner of Income-tax, in her report under rule 6 of the Income-tax S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ommission was seized of the matter after the admission order was passed on December 13, 1991. Reference is made to the definition of case at clause (b) of section 245A. Reference is also made to clause (d) of section 245A read with section 116 to bring home the point that the Settlement Commission was not an income-tax authority and the circumstances in which the Commission assumes jurisdiction. While it was open to the Department to make enquiries in respect of an applicant, no assessment proceedings could be completed after filing of the settlement application. It is submitted that the decision of the Delhi High Court in the matter of Deen Dayal Didwania v. Union of India [1986] 160 ITR 12, does not give a licence to the income-tax authorities to proceed with a matter in respect of which an application was pending before the Commission. Also referring to the decision of the Supreme Court in the matter of CIT v. Express Newspapers Ltd. [1994] 206 ITR 443, learned counsel submits that the Supreme Court did not deal with the specific issue of date of application as in section 245E and proceeded to hold that even after the application under section 245C(1) was filed, the Department ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... action taken by the Department thereafter was invalid, illegal and the assessment orders made were non est. The Com-mission should, therefore, declare the reassessment orders made in this case as invalid. To a pointed question as to whether the Department was prohibited from any action in view of the provisions of sub-section (4) of section 245F in the facts of the case when there was no express direction by the Settlement Commission regarding any assessment years in respect of which prayer was m ade under section 245E, Shri Dastur submitted that the words if necessary used by the Commission merely referred to the application which was yet to be finally settled. Taking his arguments further Shri Dastur refers to the proviso to section 245E where a time-limit is specified for invoking the said section and naturally, therefore, the necessity or expediency will have reference to the date of application. Once the said section is invoked, as is the situation in the present case, any assessment or reassessment made could be reopened by the Commission, if it was necessary or expedient to do so at the final settlement stage. Our attention is drawn to sub-section (8) of section 245D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itself. The Commission has to examine the peculiar circumstances of the case when a prayer is made for invoking the provisions of the said section. Referring to the decision of the Supreme Court in the matter of Express Newspapers Ltd. [1994] 206 ITR 443, learned counsel submits that the court did not deal with section 245E at all. In the present case, the income-tax authorities could not have exercised their authority in respect of matters covered under section 245E, which according to counsel, was invoked at the stage of the admission of the application itself. Learned counsel also referred to the decision of the Supreme Court in the matter of CIT v. Paharpur Cooling Towers Pvt. Ltd. [1996] 219 ITR 618 and stated that their Lordships in this case held the view that penalty proceedings could not be withdrawn in exercise of powers under section 245E by the Commission when certain assessments are reopened for a limited purpose only and when no request was made nor concurrence obtained to reopen the entire assessments and penalty proceedings relating to such years. As per counsel the decision does not help in deciding the present issues before this Commission. As to the interpreta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on can only invoke the provisions of section 245E at the stage of admission of the application and annul the action taken by the Department thereafter. In the present case the Settlement Commission was aware of the action taken under section 147 by the Department at the stage of hearing under section 245D(1) as noted in that order. The Settlement Commission has also noted the statement of the Commissioner of Income-tax (DR) that the Department was not subjecting the applicant to double or multiple taxation. Shri Dastur further reiterated his stand that the words if necessary used by the Commission in the order under section 245D(1) regarding the prayer under section 245E merely implied formalisation of the action at the final stage of settlement. This is how the applicant understood the said order. It will lead to injustice if the Settlement Commission does not follow the admission order as to the application of the provisions of section 245E at the stage of final settlement. Learned counsel further adds that if the Commission holds that the entire amount is assessable in the assessment year 1991-92, for which year the application is made, then there may not be any injustice to t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt to make a full and true disclosure of his income which had not been disclosed before the Assessing Officer and the manner in which such income had been derived. The responsibility of the applicant is specific and he has to make disclosure in respect of specific years with a firm commitment to that effect. In the present case, the applicant has been taking shifting stands, viz., the same income is sought to be assessed in the year for which the application is made as well as in certain other years in respect of which it is stated that prayer was made under section 245E to reopen and assess such income in those years. Referring to the decision of the Supreme Court in the case of CIT v. Express Newspapers Ltd. [1994] 206 ITR 443, it is submitted that their Lordships held that the filing of an application by the applicant before the Settlement Commission was a unilateral act and that the provision was meant for those assessees to disclose income voluntarily. Further, referring to the decision of the Karnataka High Court in the matter of N. Krishnan v. Settlement Commission [1989] 180 ITR 585, the learned Commissioner of Income-tax (DR) noticed the observations of the court that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ts of the case are examined and the matters had to be finally settled. In any case there is no provision for the applicant to move a petition under section 245E, as claimed in this case. The decision in this connection is solely that of the Commission. In any case, the order under section 245D(1), under reference, at page 4 confines itself only to the assessment year 1991-92 for which the application for settlement was made. As regards action taken under section 147 by the Department, the same was based on materials seized in the course of search and seizure action as per the reasons recorded. The order under section 132(5) also refers to the seized material as examined by the assessing authorities and conclusions drawn. The action taken by the Department cannot be interfered with unless additional income was disclosed for these years before the Commission. Apparently, no additional income was disclosed to enable the Commission to invoke the provisions of section 245E for the impugned years. Continuing with his submissions, Shri Srivastava made pointed reference to the decision of the Delhi High Court in the matter of Raja Ram Industries v. Settlement Commission [1995] 81 Taxma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s in spite of the fact the matters are pending before the Income-tax Appellate Tribunal, cannot be justified. Firstly, the Income-tax Appellate Tribunal was not a body whose powers in the exercise of jurisdiction could be superseded by the Settlement Commission. In this connection, reference was made to the decision of the Income-tax Appellate Tribunal, Mumbai Bench, in the matter of ITO v. Dhrangadhra Chemical Works (P.) Ltd. [1989] 28 ITD 499 in which it was held that, in terms of section 245F(2) the Settlement Commission did not have exclusive jurisdiction in matters placed before it by an application under section 245C(1) and, thus, the powers of the Income-tax Appellate Tribunal to exercise jurisdiction in an appeal before it on the same matter could not be superseded by the Commission. In view of this, the Commission cannot exercise jurisdiction in the matter of the pending appeals before the Income-tax Appellate Tribunal. Secondly, the Settlement Commission has exceptional powers under the circumstances such as those of reopening completed assessments under section 245E. This power cannot be exercised in normal circumstances, viz., when the matters are before other autho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iew of the assessing authorities. From the facts on record it may be seen that the jurisdiction of the Assessing Officer was never challenged in this connection. In any case, the applicant should have shown the amounts claimed to be assessable in years other than assessment year 1991-92 either in the return for that year or in the returns for those years filed in terms of notices issued under section 148, etc. It could not be the case of the applicant that such amounts were not assessable at all in any such years. The order of the Settlement Commission under section 245D(1) was limited to the question of assessment for the assessment year 1991-92 only. The order of the Commission merely records the submissions of the applicant as regards reopening of some assessments in terms of the provisions of section 245E. Shri Srivastava draws our attention to the application under section 245C(1) and asserts that there was no specific prayer under section 245E. As regards the issues before the Special Bench, it is submitted that no court could bind a future court, meaning thereby that at the stage of admission of an application under section 245D(1), the Commission cannot take a view as to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ents. For this purpose he relies on a decision of the Supreme Court in the matter of Grindlays Bank Ltd. v. ITO [1980] 122 ITR 55. At this stage, it will be proper to examine the provisions of the statute, the related decisions of the courts cited before us and in particular the scheme of settlement procedure as contemplated under the statute. At para 16 of the order of the Special Bench of this Commission in the matter of Sahitya Mudranalaya (P.) Ltd., In re and Gulraj Engineering Construction Co., In re [1995] 215 ITR (AT) 1, 14-15 ; [1995] 79 Taxman 463, at page 475-476, the settlement procedure as per the statute was appropriately detailed as under : The Income-tax Settlement Commission was constituted by the Central Government for settlement of cases in pursuance of Chapter XIX-A (sections 245A to 245M, section 245M later omitted with effect from June 1, 1987) inserted by the Taxation Laws (Amendment) Act, 1975, with effect from April 1, 1976. The scheme of settlement permits an assesse to make an application for settlement of his case to the Commission at any stage of pendency of proceedings concerning the assessment or reassessment of his income in view of sub-sectio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the case pending before it, it is necessary or expedient to reopen any proceeding connected with the case but which has been completed under this Act by any income-tax authority before the application under section 245C was made, it may, with the concurrence of the applicant, reopen such proceeding and pass such order thereon as it thinks fit, as if the case in relation to which the application for settlement had been made by the applicant under that section covered such proceeding also : Provided that no proceeding shall be reopened by the Settlement Commission under this section if the period between the end of the assessment year to which such a proceeding relates and the date of application for settlement under section 245C exceeds nine years. The proviso was substituted by the Finance Act, 1987, with effect from June 1, 1987. In this connection it will be necessary to notice a few other provisions relevant to the settlement of the cases. A case before the Commission is defined in clause (b) of section 245A as under : case means any proceeding under this Act for the assessment or reassessment of any person in respect of any year or years, or by way of appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... relevant portions of the reported cases for better appreciation of the issues. The Supreme Court in the matter of CIT v. Paharpur Cooling Towers Pvt. Ltd. [1996] 219 ITR 618 had the occasion to deal with the provisions of section 245E and their Lordships observed at pages 627-628 as under : Once an application is admitted-an application can be made only in respect of a pending case-the Commission takes over all the proceedings relating to that case which may be pending before any authority under the Act. But this power is confined to the case before the Commission, which means the case relating to the assessment year for which the application for settlement is filed and admitted for settlement to wit, assessment year 1975-76 in this case. Section 245E, which is the sheet anchor of the majority opinion, empowers the Commission to reopen any completed proceedings connected with the case before it but this power is circumscribed by the requirement expressly stated in the section that such reopening of completed proceedings should be necessary or expedient for the proper disposal of the case pending before it. (emphasis provided by court). There are two other limitations upon th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation is filed under section 245C(1) as under (page 456) : This discussion also shows that the Commission cannot say that any material collected by the Commissioner after the date of filing of the application under section 245C is not relevant for the purposes of section 245D(1). The filing of an application by the assessee is a unilateral act. The Department may not be aware of the same. The proper line ordinarily speaking is to be drawn with reference to the date of submission of the report of the Commissioner. This does not, however, prevent the Commission from looking into material collected by the income-tax authorities even subsequent to the submitting of the report by the Commissioner, if it thinks such a course is called for in the interests of justice. As to the scheme of the Act relating to settlement their Lordships opined at page 456 as under : Chapter XIX-A is a part of the Income-tax Act and must be construed consistent with the overall scheme and object. The Chapter is meant for those assessees who want to disclose income not disclosed till then together with the manner in which the said income is derived. It is not meant for those who come after the ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... matter of Om Metals and Minerals Ltd. [1992] 193 ITR 57 held that the assumption of exclusive jurisdiction (by the Settlement Commission) to exercise the powers and perform the functions of an income-tax authority . . . in relation to the case on the admission of a settlement application, does not render invalid, the valid and legal orders passed and actions taken by the income-tax authorities before the admission of the settlement petition. As to the procedure before the Commission and the powers of the Commission in settling the tax liabilities of an applicant, their Lordships of the Karnataka High Court held in the matter of N. Krishnan v. Settlement Commission [1989] 180 ITR 585 as under (page 596) : As observed by us earlier, the Settlement Commission was to be constituted for settling complicated claims of chronic tax evaders as an extraordinary measure, for giving an opportunity to such persons to make a true confession and to have matters settled once for all, and earn peace of mind. It is a forum for self-surrender and seeking relief and not a forum for challenging the legality of assessment order or orders passed in any other proceedings. This is not only evident f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Chambers Dictionary, New Edition, India, 1993) (1) advantageous, advisable on practical rather than moral grounds. (2) suitable, appropriate, (n) a means of attaining an end ; a resource. etc. (The Concise Oxford Dictionary, Fourth Impression, 1993) Expedit rei publicae ut sit finis litium-the principle in Roman law- It is for the public good that there should be an end to litigation . (Mitra s Legal and Commercial Dictionary, Fourth Edition, 1985) (1) useful for effecting a desired result ; suited to the circumstances ; convenient (2) based on what is of use or advantage rather than what is right or just ; guided by self interest , etc. (Webster s New World Dictionary, Second Indian Reprint, 1976) Apt and suitable to end in view. Whatever is suitable and appropriate in reason for the accomplishment of a specified object. (Black s Law Dictionary, Fifth Edition, 1979) Maxwell opened his monumental work Interpretation of Statutes with the following words : Statute law is the will of the legislature ; and the object of all judicial interpretation of it is to determine what intention is either expressly or by implication conveyed by the language used, so far ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... l be necessary to go into the very genesis of the constitution of the Settlement Commission and its functioning in the general scheme of the direct tax statutes and the scheme of settlement. We have, in this context, cited a portion of the order of the Special Bench of the Commission at para 10.1 (at pages 62-63). At paras 10.2 and 10.3 (at pages 63-65), we have reproduced certain provisions in the scheme of settlement as at Chapter XIX-A. Since the issues are closely connected to the peculiar facts and circumstances of the case we have detailed the sequence of events leading to the filing of the settlement application at para 2 (at page 41). At para 3, (at page 43), we have detailed the contents of the application. At para 4, (at page 44), we have noted the order of admission under section 245D(1). At paras 5 and 6 (at pages 45-49), we have discussed the facts of the case in the context of the settlement application. We may reiterate a few peculiar features of the case. Unlike the claim in the settlement application at column 11, it is not a fact that the Assessing Officer in his order under section 132(5) allocated any part of the disclosed speculative income for assessment yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n for the assessment year 1991-92 was admitted by the Commission to be proceeded with and the reassessments in these cases have been completed along with the assessment for the assessment year 1990-91 after the said application was admitted. We are unable to subscribe to the views of Shri Dastur, learned counsel of the applicant, that the Department could not proceed with any assessment after an application is made under section 245C(1). Shri Dastur objects to such assessments/reassessments not only in respect of the assessment year 199192 for which application was made in this case but also for the years for which prayer is made in the said application for reopening the assessments under section 245E. We have reproduced the relevant portions of the decision of the Supreme Court in the matter of Express Newspapers Ltd. [1994] 206 ITR 443, and the decision of the Delhi High Court in the matter of Deen Dayal Didwania [1986] 160 ITR 12, to emphasize the point that the Department is not barred from proceeding with any matter before an application is admitted by the Settlement Commission and also any matter relating to any year other than the year for which the settlement application is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oncurrence of the assessee was required. The provision also lays down the period up to which the assessments could be reopened. Their Lordships were of the view that the section contemplates reopening the completed proceedings not for the benefit of the assessee but in the interests of the Revenue and the Commission while invoking the provisions could not do indirectly what cannot be done directly , since the power conferred by section 245E was a circumscribed and conditional power . It could only be exercised in accordance with and subject to the conditions laid down in the section and in no other manner . In our opinion, therefore, the Commission rightly did not invoke the provisions of section 245E for reopening certain assessments in the order under section 245D(1) but it merely recorded the prayer of the applicant in this respect. It will not be out of place, therefore, to reject the views of learned counsel of the applicant that the decisions of the Supreme Court in the matters of Express Newspapers Ltd. [1994] 206 ITR 443 and Paharpur Cooling Towers Pvt. Ltd. [1996] 219 ITR 618, had no applicability to the facts of the case on the ground that the said decisions did no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ection 245E at any stage after the admission of the application. It may be that in a case, at the admission stage, all the material facts may not be available to come to the conclusion that it was necessary or expedient to reopen any proceedings connected with the case. The Commission may, therefore, defer consideration till the material facts have been collected through the report of the Commissioner of Income-tax under rule 8 of the Income-tax Settlement Commission (Procedure) Rules, 1987, or from the applicant or through investigation of the issues by gathering information from external sources. Thus the Commission can in law consider the question of reopening the assessments under section 245E at the stage of settlement of the case under section 245D(4). We do not find any justification for the Commissioner of Income-tax (DR) s view that the question can be considered only at that stage. We are of the view that the applicant can always pray for reopening of the completed assessments and the same has to be considered by the Commission in terms of the requirements of section 245E. It is, however, not obligatory for him to do so. The Commission can, suo motu, take up the question ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... isclosed under section 132(4) for the assessment year 1991-92 has not been interfered with or bifurcated by the Assessing Officer as income for any earlier year but the Assessing Officer had only assessed/reassessed in the earlier years amounts which, on a true interpretation of the seized documents, became distinctly assessable in those years under the Act, but this claim is contested by the applicant. It is reiterated by learned counsel that the disclosure for the assessment year 1991-92 did not consist of any income other than income from speculation. Items shown in the disclosure relate only to the assessment year 1991-92 and any other items shown related to this are disclaimed by the applicant. However, it is urged that there are some transactions made earlier for which payments are claimed to be made out of the speculation income disclosed during the previous year relevant to the assessment year 1991-92 only. While the veracity of the factual position regarding the dates of payments for such transactions will be gone into by the Additional Bench of the Settlement Commission at Mumbai and appropriate decision taken regarding the computation of income on the basis of the aver ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
