GLIMPSE OF A LATEST TAX VERDICT* Smt. P. Suman v. CIT Reported: [2022] 440 ITR 214 (Mad) Dated: 18.08.2021 *Hon’ble Justice T.S. Sivagnanam and Hon’ble Justice Sathi Kumar Sukumara Kurup* in the matters relating to *“Settlement Commission –
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*GLIMPSE OF A LATEST TAX VERDICT*Smt. P. Suman v. CIT
Reported: [2022] 440 ITR 214 (Mad)
Dated: 18.08.2021
*Hon’ble Justice T.S. Sivagnanam and Hon’ble Justice Sathi Kumar Sukumara Kurup* in the matters relating to *“Settlement Commission – Income Tax Act, 1961”* allowed the Writ Appeal, setting aside the Writ Petition Order and restored the Order passed by the Income-Tax Settlement Commission, and further observed and held as follows:
*Facts:*
Seizure and search operation u/S. 132 of IT Act, 1961 were carried out at the assessee’s business and residential premises. Notices u/S. 153A were issued to assessee. Thereafter, assessee filed an application u/S. 245D(1) before the Income Tax Settlement Commission (ITSC). Report was directed to be filed by CIT which stated that full and true disclosure was not made by assessee. ITSC passed an order bringing on record additional income offered by the assessee and rejected plea of interest waiver and with regard to immunity from penalty, recorded that assessee co-operated with proceedings and also recorded that assessee agreed to abide directions of further disclosure, in order to bring quietus to the matter. Hence, ITSC granted prayer for immunity from penalty and prosecution. Later, Writ Petition was filed by Revenue Department challenging the order of ITSC.
*Findings:*
i) Proceedings before the ITSC is a special mechanism provided by the Act itself under Chapter XIX-A to deal with settlement of cases. If the ITSC is satisfied and after recovery of tax payable, it will be in a position to grant immunity from penalty and prosecution to the assessee.
ii) The learned Single Judge ought not to have submitted views on conclusion of ITSC unless it is found that there is a serious error in the decision making process.
iii) Further disclosure pursuant to the verification report u/S. 245D submitted before ITSC cannot be construed that the assessee had not made a full and true disclosure at the first instance.
iv) If a very rigid approach is taken, then the very purpose of enacting sub-section (6) of S. 245D would lose its purpose.
