TaxTMI 
TaxTMI 
TaxTMI 
2020 (2) TMI 1287
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.... June, 2010, the National Thermal Power Corporation (NTPC) had invited bids under international competitive bidding for the supply and installation of 11*660 MW steam generators at five locations in India. A bid was successfully submitted by one BGR Energy Systems Limited (BGRE), a company incorporated in India and engaged in providing turnkey solutions for coal based thermal power plants. 4. I desist from adverting to the specifics of the contracts themselves or the manner in which the work has been apportioned and allocated by NTPC/BGRE to other parties, since it is not entirely necessary to decide the legal issue that has been raised in this Writ Petition. Suffice it to say that BGRE had sub-contracted a portion of the scope of work under three contracts to its joint venture company BGR Boilers Private Limited (BGRB), which, in turn, subcontracted a portion of the same to the petitioner. 5. One of the contentions raised by the petitioner on merits was that the scope of work under each of the contracts is separate and distinct in all respects including the delineation of the work itself, the modes of execution of the contract and the payments therefor. For this reason, the peti....
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....he Departments' report on the application filed. 11. At paragraph 4.1.5 of order dated 26.11.2018, the Commission notes the submissions of the petitioner in regard to the non-taxability of income from offshore supply. It also notes the specific submission that further and detailed submissions in that regard would be made in the course of subsequent proceedings. Again, at paragraph 6 reference is made to the transaction in relation to offshore supply and the taxability of the same. It was also specifically noted that no additional income has been offered along with the application in this regard. The decision to admit the matter for further hearing is in the following terms: '7. On examination of the SOF and related material and on thoughtful consideration of the facts as discussed during the course of hearing, we find that technical parameters in the Application with regard to pendency of assessment proceedings, tax liability exceeding the threshold limit, payment of application fee of Rs. 500/- and intimation to the Assessing Officer have been duly fulfilled by the applicant. The applicant has also explained the manner in which the additional income is derived in the SOF. On th....
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....racts are, in fact, and in his opinion, indivisible. 16. The SC however, in considering the 'validity' or otherwise of the application proceeds to delve into the merits of the matter even at that stage, concluding that the contract was composite and indivisible and hence the applicant, i.e,. the petitioner herein, had failed to make a full and true disclosure of income. 17. In my considered view, this tantamounts to putting the cart before the horse. Certainly, if the Commission decides adverse to the petitioner in final hearing, holding that the contract and transactions were composite and indivisible, there would be an additional tax liability upon the petitioner. This demand however can be raised only once a decision has been rendered in terms of Section 245D(4) by the Commission on the issues posed before it, the first of which is, whether at all the income from offshore supply is liable to tax in India. The question of full and true disclosure and the discharge of tax liability at all stages prior to final hearing, should be seen only in the context of the issues offered for settlement and the remittances of additional tax thereupon. Issues decided by the Commission and lia....
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....on 245- C. It provides that at any stage of a case relating to him, an assessee may make an application to the Commission disclosing fully and truly income which has not been disclosed before the Assessing Officer. He must also disclose how the said income has been derived by him besides certain other particulars. This means that an assessee cannot approach the Commission for settlement of his case with respect to income already disclosed before the Assessing Officer. An application under Section 245- C is maintainable only if it discloses income which has not been disclosed before the Assessing Officer. The disclosure contemplated by Section 245- C is thus in the nature of voluntary disclosure of concealed income. Unless the income so disclosed exceeds Rs. 50,000, the application under Section 245-C is not maintainable. It is equally evident that once an application made under Section 245-C is admitted for consideration (after giving notice to and considering the report of the Commissioner of Income Tax as provided by Section 245-D) the Commission shall have to withdraw the case relating to that assessment year (or years, as the case may be) from the assessing/appellate/revising....
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.... and this issue thus also stood encompassed by the final order of the Commission. 25. The plenitude of powers that the Settlement Commission enjoys has been long settled by the Supreme Court in R.B.Shreeram Durga Prasad V. Settlement Commission (176 ITR 169), Jyotendrasinghji V. S.I.Tripathi (201 ITR 611) and Kuldeep Industrial Corpn. V. ITO (223 ITR 840) and there can thus be no question that the Commission is empowered to both adjudicate upon as well as settle issues arising from a 'case' in respect of which an Application is made. 26. The revenue relies on a decision of this Court in the case of Abdul Rahim V. ITSC ((2018) 96 Taxmann.com 571). The facts in that case are different and distinguishable from the one before me. A preliminary order of admission under section 245D(1) was passed on the application of the assessee therein. The Commissioners' report however brought to light certain materials including a pen drive and compact discs that had not been duly disclosed by the petitioner in his application. Thus when the matter was taken up for admission by the Commission, it was contested by the Revenue on the ground that there was no full and true disclosure by the petitione....