Case Law Details
ACIT Vs Pradip Overseas Ltd (ITAT Ahmedabad)
ITAT Ahmedabad held that once the Income Tax Settlement Commission has passed final order u/s. 245D of the Income Tax Act, AO has no jurisdiction to reopen the same u/s. 148 of the Income Tax Act.
Facts- A search and seizure operation was carried in the case of assessee as on 21-09-2010. The assessee filed an application u/s. 245C(1) on 03-05-2023 for settlement of the case before Income Tax Settlement Commission. The Income Tax Settlement Commission passed an order dated 07-11-2014 u/s. 245D(4) settling the matter for assessment year 2006-07 to 2012-13. Thereafter, The Revenue authority issued notice u/s. 148 for assessment year 2012-13.
Notably, AO in the assessment order passed u/s. 144 r.w.s. 147 of the Income Tax Act, 1961 dated 21-12-2018 overlooked the decision of Income Tax Settlement Commission and made addition of Rs. 21,06,93,932/- on account of income earned by the employing circular inflated purchases thereby taking 3% of amount of circular trading in respect inflated stock which was not disclosed in the return of income. CIT(A) partly allowed the appeal.
Conclusion- Held that the Income Tax Settlement Commission has passed order which is binding on the Revenue Department and the Assessing Officer has no power to reopen the assessment. The ld. CIT(A) has rightly held that claims which are part of the resolution plan stood extinguished as well as once the Income Tax Settlement Commission has decided/settled the tax component between the assessee and the revenue, the revenue authorities do not have any power to reopen such assessment.
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