Case Law Details
Shree Nilkanth Developers Vs PCIT (Supreme Court of India)
Supreme Court held that while setting aside the order of Settlement Commission, High Court could have remanded the matter to the Settlement Commission for re-consideration and re-determination of undisclosed income. It is unjust to set aside the order of Settlement Commission without re-determination of undisclosed income.
Facts- The appellant is in the business of real estate. The Department conducted a survey and concluded that there was a practice of receiving undisclosed amounts but they had been offered as additional income to an extent of Rs.3 crores for taxation over and above the disclosed income/normal income as such; that it was only a case of a tentative disclosure or non-disclosure and took time to make a complete disclosure.
The survey was conducted on 11.01.2013. Thereafter, on 21.01.2014, the appellant moved the Settlement Commission in respect of A.Y. 2011-12, 2012-13 and 2013-14 by way of an application seeking settlement of its case. The appellant estimated the additional income for the AY 2011-12 at Rs.10 lacs, AY 2012-13 at Rs.13 lacs and AY 2013-14 at Rs.11 lacs totalling Rs.34 lacs, which was offered for taxation and additional amount of income tax payable on the said amount was stated to be Rs.10,65,600/- and interest at Rs.2,85,935/-.
The Settlement Commission passed an order u/s. 245(D) (1) of the Act allowing the case to proceed further. Accordingly, the Department sent its report under Rule 9 of the Income Tax Settlement Commission (Procedure) Rules, 1997 and objected to the offer of settlement of Rs,.34 lacs being offered as additional income and contended that there was no full disclosure of the material particulars. The Department sought for closure and dismissal of the settlement application.
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