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TMI Blog2002 (11) TMI 68X X X X Extracts X X X X X X X X Extracts X X X X ..... rs made the following observations in paragraph 25 at annexure A: "The Income-tax Officer will issue a demand notice and will also revise the assessment of partners so far as it covers the share income from the applicant firm." It is also common ground that it was only the firm that was the applicant before the Settlement Commission. Needless to say the registered firm and its partners are considered as separate entities under the provisions of the Act. Since the rights of individual partners was determined in the Settlement Commission's order the partners moved the Settlement Commission for deletion of the impugned observation of the Settlement Commission with respect to liability on the individual partners. The Settlement Commission by an order dated January 22, 1991, rejected the plea of the partners. Aggrieved by the order of the Settlement Commission the partners in their individual capacity filed W.P. Nos. 22001-22002 of 1991. (V.B. Desai v. Administrative Officer, Settlement Commission for I. T. and W. T (No. 1) [2003] 260 ITR 273 (Karn). The learned single judge, upheld the contention of the appellants that the Settlement Commission has no jurisdiction to issue any dir ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 45D). Every order made by the Settlement Commission has to be complied with and it is also subject to the condition that the settlement shall be void if it is subsequently found by the Commission that it had been obtained by fraud or misrepresentation of facts (section 245D(6)). The Settlement Commission has got the power to reopen the completed proceedings of assessment also if eight years had not elapsed from the end of the assessment year concerned (section 245E). The Settlement Commission is conferred with all the powers vested in any income-tax authority (section 245F). No person is permitted to inspect or obtain copies of any reports made by any income-tax authority to the Settlement Commission, but the Settlement Commission has the discretion to furnish copies thereof on an application made to it. However, if the person whose case is under consideration before any Settlement Commission wants any document to rebut any evidence against him, the Settlement Commission has to furnish copies of the documents sought for (section 245G). The Settlement Commission is invested with the power to give immunity against prosecution and/or imposition of penalty on being satisfied that the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been committed by the Settlement Commission except as above. The learned single judge fell in error in reopening the order of the Settlement Commission with respect to the firm at the instance of the partners. The partners only wanted certain observations made by the Settlement Commission against the partners in their individual capacity to be deleted, since they were not parties before the Settlement Commission. The learned single judge either ought to have dismissed the writ petition filed by the partners or deleted those observations of the Settlement Commission as against the partners, since they were made against the persons who were not parties before the Settlement Commission. Instead the order of the Settlement Commission was set aside and remanded for fresh disposal without such a prayer. In that view of the matter we feel it is the Revenue that ought to have filed this appeal against the order of the learned single judge with regard to the substantial issue of the court setting aside the order of the Settlement Commission. This is a curious case where the registered firm did not file the writ petition. It is the individual partners who filed the writ petition in thei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... came into force on October 1, 1984. This very question arose before the Division Bench of this court in I.T.R.C. Nos. 137-142 of 1994, dated June 14, 1996. This court was required to determine whether section 155(1)(c) of the Act is prospective or retrospective. The Division Bench of this court in I.T.R.C. Nos. 137-142 of 1994 (CIT v. Shri A. V. Venkatakeshava Setty) pronounced as follows: "The assessee is a partner in a firm. The firm made an application for settlement of the matter before the Commission constituted for the purpose in terms of section 245D(4) and the Settlement Commission made an order on September 13, 1982, for the assessment years 1975-76 to 1980-81 pursuant to which assessments of the firm were revised and the total income of the firm for each of the assessment years was enhanced. As a consequence of the enhancement of the firm's income, the share of the assessee was determined higher than what was assessed earlier. The Income-tax Officer initiated proceedings under section 155 of the Income-tax Act and revised the assessment for the assessment years in question. The matter was carried in appeal and the appellate authority agreed with the contentions raised o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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