S.P.A.M. Krishnan Chettiar and Son Vs. Income-tax Settlement Commission and Another - Court Judgment

Excerpt:
direct taxation - settlement - section 245c of income tax act, 1961 - whether appellant entitled to direction to respondent to be taken on file settlement application filed by appellant on 09.08.1989 - section 245c conferred on assessee concession or option to settle his tax disputes - availing of that can be subject to fulfillment of conditions prescribed under section - amendment of section 245c with effect from 01.10.1984 was purely procedural and would govern application filed by appellant on 09.08.1989 - application field by appellants did not contain particulars required by section 245c - as such application was incomplete and defective - appeal liable to be dismissed. head note: income tax settlement commission--application under s. 245c--law applicable--amendment of s. 245c w.e.f. 1-10-1984 imposing certain restrictions for filing application--application filed thereafter for asst. yr. 1980-81 also to be in compliance with the amended provisions for the said provisions held : the amendment of s. 245c by the amendment act, w.e.f. 1-10-1984, was also purely procedural and would undoubtedly govern the application filed by the appellant on 9-8-1989. the proceedings before the commission are in the nature of a concession given to an assessee who had suppressed the income and the commission has been authorised to give immunity to such assessees, but it cannot be given by the settlement commission if the assessee fails to give a full and true account of his income. sec. 245c confers on the assessee a concession or option to settle his tax disputes and the availing of that can only be subject to the fulfilment of conditions prescribed under the section. the application filed by the appellant did not contain the particulars required by s. 245c, though the application was filed in form no. 34b, which would be relevant, after the amendment w.e.f. 1-10-1984, and the application so filed was an incomplete and defective one, which was rightly not entertained by the first respondent. application : also to current assessment years. income tax act 1961 s.245c - s. ramalingam, j. 1. the petitioner is an assessee under the income-tax act, 1961 (for short, 'the act'). for the assessment year 1980-81, a sum of rs. 2,65,105 had been added to the returned income of rs. 1,62,098. the petitioner preferred an appeal to the commissioner of income-tax (appeals). the appeal was allowed and the matter was remanded for fresh consideration by order dated december 28, 1987. 2. thereafter, the petitioner submitted an application on august 9, 1989, under section 245c(1) of the act for settlement in respect of the assessment year 1980-81. this application was dismissed as not maintainable by order dated september 20, 1989, which is impugned in this writ petition. 3. learned counsel for the petitioner would submit that the two reasons given in the order : (1) that since the application was filed on august 9, 1989, it is governed by the requirements of the amended section 245c(1) of the act; and (2) that the petitioner had not disclosed any amount in his application which has not been disclosed before the income-tax officer are not correct in law. he would submit that the application related to the assessment year 1980-81. the unamended section 245c(1) of the act reads as follows : 'an assessee may, at any stage of a case relating to him, make an application in such form and in such manner as may be prescribed, and containing a full and true disclosure of his income which has not been disclosed before the income-tax officer, the manner in which such income has been derived, the additional amount of income-tax payable on such income and such other particulars as may be prescribed, to the settlement commission to have the case settled and any such application shall be disposed of in the manner hereinafter provided :' 4. section 245c of the act was amended by the taxation laws (amendment) act, 1984, effective from october 1, 1984. this amendment grants substantial relief but imposes two restrictions in moving application for settlement before the commission. the first restriction is that the assessee should, inter alia, make a full and true disclosure of his income which has not been disclosed before the income-tax officer and the manner in which such income has been derived and the additional amount of income-tax payable on such income and such other particulars as may be prescribed. the second restriction is that no such application can be made unless the income-tax payable on the income computed as provided in sub-sections (1b) to (1d) exceeds rs. 50,000. it is not in dispute that the petitioner has not in his application made a full and true disclosure of the income which has not been disclosed before the income-tax officer or the manner in which such income had been derived and the additional amount of income-tax payable on such income. therefore, the application submitted by the petitioner under section 245c of the act did not satisfy the requirements of the amended section. 5. the contention of the petitioner is that the application made by him for relief by way of settlement related to the assessment year 1980-81, and even though he had submitted the application only on august 9, 1989, there is no need for his to comply with the amended section 245c of the act and it is sufficient if his application satisfies the provisions of the unamended section 245c of the act. this contention can hardly be accepted. even though section 245c of the act was amended by the taxation laws (amendment) act in 1984 which is effective from october 1, 1984, since it has not been disputed that the application submitted by him was in the year 1989, long after the amendment came into force, it is obvious that the commission has jurisdiction only if the application is made after complying with the requirements of section 245c of the act as it stood on the date when the application was submitted. since the petitioner, admittedly, has not complied with the requirements of section 245c in his application dated august 9, 1989, the application has rightly been rejected as not maintainable. 6. learned counsel for the petitioner would submit that even though he had asked for a personal hearing, such personal hearing was not given and, therefore, the order is vitiated. this contention is bereft of merit. if, on the facts, the petitioner has not disclosed the additional income-tax payable by him and has also not intimated the source of such income, the application prima facie is not maintainable in law and it is not wrong if any personal hearing was not given in such cases. the writ petition stands dismissed.