TaxTMI 
TaxTMI 
2013 (9) TMI 896
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....Commission under Section 245D(2C) of the Income Tax Act, 1961 (Act, for short). As the facts are inter-linked and the reasons given by the Settlement Commission are in a common order, we are disposing of these writ petitions by one order. 2. As the issues and arguments raised before us are limited and lie in a narrow compass, we deem it appropriate to refer to relevant and pivotal facts necessary to decide the two petitions. The petitioners herein had filed two applications under Section 245C of the Act relating to Assessment Years 2005-06 to 2012-13 on 31st December, 2012. At that time, assessment proceedings under Section 153A and 143(3) were pending before Additional Commissioner of Income Tax, Central Circle-10, New Delhi. By order dat....
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..... The Learned Counsel for the applicants and learned CIT (DR) accompanied by A.O. strenuously argued their respective cases. Apart from the issues raised by the CIT in his reports it was noticed that in several respects the applicants were not maintaining their accounts as per law nor were they revealing the real income. In the case of M/s MARC Sanitation Pvt. Ltd. stock on the date of search was found short but no income on the business carried on outside the books of sale of this stock was declared. The applicant contended that stocks as per books have been inflated to paint a rosy picture before the banks. However at page 26 of the SOF para 19 it was seen that the applicant company had in Assessment Year 2012-13 reduced the level of stoc....
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....d that the said company had wrongly reduced the level of stock in the books of accounts by Rs.5,88,14,889/- without proper entries was not objected to and adversely commented upon by the Commissioner in his report. It is accordingly submitted that the Settlement Commission was swayed by factors which even the Commissioner did not consider, were relevant. The petitioner contends that stocks were inflated to paint a rosy picture before the bank. With regard to the objection noticed in the case of Marc Bathing Luxuries Limited, it is submitted that there is a gross error as an extract of the profit and loss account was separately filed and the Settlement Commission has ignored the full account/profit and loss account and computation of income ....
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.... under the Excise Act or by the adjudicating authority were disclosed in the said applications. It is further submitted that the income tax department had substantially relied upon the documents and material seized during the search under the Excise Act. It is stated that the main dispute and the contention was not the quantum of turnover, though the said issue had been raised, but the gross profit rate, which should be applied on the unaccounted for but now declared turnover. 8. The petitioners had declared a GP rate of 10.21%, whereas the Revenue, i.e., Commissioner was claiming GP rate of 25% was appropriate and should be applied. 9. We have referred to the said contentions in some detail to highlight the contentions/issues raised and ....
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....titioners have a right to invoke jurisdiction of the Settlement Commission, which is provided under the statute, i.e., Income Tax Act. Once an application is filed, then the said application must be dealt with in accordance with law, i.e., refer to the contentions of the petitioners, the contention of the Revenue and then an objective, considered and a reasoned decision has to be taken. This is only when the stand of the two sides are fully noticed and considered before an order under Section 245D(2C) is passed. The impugned orders do not meet the said legal requirements. 12. The petitioners must come clean and be honest and admit their faults and cannot but declare their true and full undisclosed income. However, their plea and explanatio....