Principal Commissioner of Income-tax, Central-4 v. Income-tax Settlement Commission & Anr
[Citation -2020-LL-0214-48]

Citation 2020-LL-0214-48
Appellant Name Principal Commissioner of Income-tax, Central-4
Respondent Name Income-tax Settlement Commission & Anr
Court SUPREME COURT
Relevant Act Income-tax
Date of Order 14/02/2020
Judgment View Judgment
Keyword Tags settlement commission • additional income • full and true disclosure • condonation of delay
Bot Summary: 3 The High Court of Judicature at Bombay, by an order dated 3 August 2018, dismissed the writ petition 1 filed by the appellant under Article 226 of the Constitution, challenging an order of the Income Tax Settlement Commission2 dated 23 April 2015. The Division Bench of the High Court dismissed the Signature Not Verified petition on the ground of delay. The writ petition in the High Court was lying in objections for long. 6 Having considered the rival submissions, 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. We accordingly order and direct that conditional on the appellant paying a sum quantified at Rs 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 dated 3 4 August 2018 shall stand set aside and the writ petition shall stand restored to the file of the High Court for disposal on merits. UPON hearing the counsel the Court made the following O R D E R Delay condoned.


IN SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION Civil Appeal No 1590 of 2020 (Arising out of SLP(C) No 9978 of 2019) Principal Commissioner of Income Tax Central 4 .... Appellant(s) Versus Income Tax Settlement Commission & Anr Respondent(s) ORDER 1 Delay condoned. 2 Leave granted. 3 High Court of Judicature at Bombay, by order dated 3 August 2018, dismissed writ petition 1 filed by appellant under Article 226 of Constitution, challenging order of Income Tax Settlement Commission2 dated 23 April 2015. order of Settlement Commission was received on 20 May 2015. writ petition was filed on 16 November 2015. Division Bench of High Court dismissed Signature Not Verified petition on ground of delay. Digitally signed by SANJAY KUMAR Date: 2020.02.18 16:55:30 IST Reason: 1 Writ Petition No 1062 of 2018 2 Settlement Commission 2 4 Assailing judgment of High Court, Mr Zoheb Hussain, learned counsel appearing on behalf of appellant, relied on judgment of two-Judge Bench of this Court in State of Nagaland v Lipok AO3. That apart, it has been submitted that, on merits, serious issue requires consideration by High Court having regard to principles which have been enunciated by this Court in Ajmera Housing Corporation v Commissioner of Income Tax4. Mr Zoheb Hussain submitted that, in course of search, amount of Rs 74.55 crores was offered as additional income, including sum of Rs 6.03 crores, pertaining to AY 2006-2007. Learned counsel then adverted to fact that during pendency of proceedings, at hearing before Settlement Commission on 9 April 2015, counsel for second respondent offered additional income from TNEB contract of Rs 4.32 crores and disallowance under Section 14A of Income Tax Act 1961 computed at Rs 95 lakhs. On date of pronouncement of judgment, further amount of Rs 5 crores was offered by letter of offer. Accordingly, total amount of Rs 10.18 crores came to be offered by way of additional income. Relying on observations contained in paragraphs 35 and 41 of decision in Ajmera Housing Corporation (supra), it has been urged that above facts would indicate that disclosure which was originally made was not true, full and complete as result of which Settlement Commission had no jurisdiction to arrive at settlement. 3 (2005) 3 SCC 752 4 (2010) 8 SCC 739 3 5 Opposing these submissions, Mr Percy Pardiwala, learned Senior Counsel appearing on behalf of second respondent, submitted that order of Settlement Commission was given effect to in June 2015 on receipt of copy in May 2015. second respondent, it has been submitted, paid up entire amount, which was due and payable towards taxes and interest. writ petition in High Court was lying in objections for long. In this background, Mr Pardiwala submitted that it would be unfair to condone delay on part of Revenue in seeking recourse to jurisdiction under Article 226 of Constitution. In event that writ petition were to be allowed for any reason, assessee would be liable to pay interest for previous period of nearly three years on assessment. Mr Pardiwala justified order of Settlement Commission on merits saying that additional income, which was disclosed during course of hearing, was in course of discussion which took place before Settlement Commission. 6 Having considered rival submissions, nature and extent of delay and issues involved, we are of view that it would be appropriate and proper, in interests of justice, for writ petition to be heard on merits by High Court, subject to payment of costs, which would be condition precedent. High Court ought not to have dismissed petition on ground of delay. appellant raises issues which are worthy of consideration on merits. We accordingly order and direct that conditional on appellant paying sum quantified at Rs 3,00,000 to second respondent, by way of costs, withing period of six weeks from today, judgment and order of High Court dated 3 4 August 2018 shall stand set aside and writ petition shall stand restored to file of High Court for disposal on merits. In event that appellant fails to pay costs, as directed, benefit of this order shall not be available. 7 appeal is allowed in above terms. J. [Dr Dhananjaya Y Chandrachud] J. [K M Joseph] New Delhi; February 14 , 2020 5 ITEM NO.37 COURT NO.7 SECTION IX S U P R E M E C O U R T O F I N D I RECORD OF PROCEEDINGS Petition(s) for Special Leave to Appeal (C) No(s).9978/2019 (Arising out of impugned final judgment and order dated 03-08-2018 in WP No. 1062/2018 passed by High Court of Judicature at Bombay) PRINCIPAL COMMISSIONER OF INCOME TAX CENTRAL 4 Petitioner(s) VERSUS INCOME TAX SETTLEMENT COMMISSION & ANR. Respondent(s) Date : 14-02-2020 This petition was called on for hearing today. CORAM : HON'BLE DR. JUSTICE D.Y. CHANDRACHUD HON'BLE MR. JUSTICE K.M. JOSEPH For Petitioner(s) Mr. Zoheb Hussain, Adv. Mr. Kanu Agrawal, Adv. Ms. Shraddha Deshmukh, Adv. Mrs. Anil Katiyar, AOR Mr. Sanjeev Menon, Adv. Mr. Piyush Goyal, Adv. For Respondent(s) Mr. Percy Pardiwala, Sr. Adv. Ms. Vasanti B. Patel, Adv. Ms. Praveena Gautam, AOR Mr. Pawan Shukla, Adv. Mr. Raja Ram, Adv. Ms. Sweety Pandey, Adv. UPON hearing counsel Court made following O R D E R Delay condoned. Leave granted. appeal is allowed in terms of signed order. Pending application, if any, stands disposed of. (SANJAY KUMAR-I) (SAROJ KUMARI GAUR) AR-CUM-PS COURT MASTER (Signed order is placed on file) Principal Commissioner of Income-tax, Central-4 v. Income-tax Settlement Commission & Anr
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