2023 (5) TMI 881 - HC - Income Tax

Application under Section 245C(1) not maintainable where Section 147 proceedings had not commenced per Explanation (i) Clause (b) Section 245A

DELHI HC held the petitioner's application under section 245C(1) was not maintainable for Assessment Years 2012-13, 2013-14 and 2014-15. The court found ... Settlement application u/s 245C(1) - whether there was no ‘case’ existing, thus the applications for settlement of case(s) u/s 245C was not maintainable? - HELD THAT:- A plain reading of Explanation (i) to Clause (b) of Section 245A of the Act clearly indicates that the proceedings in relation to assessment or reassessment or re-computation under Section 147 of the Act had not commenced in respect of the Assessment Years 2012-13, 2013-14 and 2014-15 and therefore, we find no infirmity with the decision of the Commission that the petitioner’s application under Section 245C of the Act in respect of the said assessment years, was not maintainable. Issues involved: Impugning an order of the Income Tax Settlement Commission u/s 245D(1) of the Income Tax Act for holding the settlement application u/s 245C(1) invalid for certain assessment years.Summary:Issue 1: Validity of Settlement ApplicationThe petitioner challenged the Commission's order deeming the settlement application invalid for Assessment Years 2012-13, 2013-14, and 2014-15 under Section 245C(1) of the Act. The Commission found no pending assessment proceedings for the petitioner for those years, rendering the application not maintainable.Details: The central question was whether the Commission erred in rejecting the petitioner's application under Section 245C(1) for the mentioned assessment years. As the time for assessment had lapsed and no notice was issued for reassessment, the Commission's decision was based on the absence of ongoing proceedings for those years.Issue 2: Interpretation of Relevant LawThe case involved interpreting Clause (b) of Section 245A of the Act, which defines a 'case' as any pending assessment proceeding before an Assessing Officer. The explanation under this clause clarified the commencement of assessment/reassessment proceedings for different scenarios.Details: The Court referred to the decision in a previous case to address the controversy. It analyzed the provisions of Section 245A, specifically the explanation related to the commencement of assessment proceedings. The Court concluded that as per the explanation, no proceedings had commenced for the mentioned assessment years, justifying the Commission's decision on the application's invalidity.Conclusion:The Court dismissed the petition, upholding the Commission's decision regarding the invalidity of the settlement application for the specified assessment years under Section 245C of the Income Tax Act.