G.Gopalakrishna Pillai Vs Income Tax Settlement Commission (Madras High Court)
In G. Gopalakrishna Pillai Vs Income Tax Settlement Commission, the Madras High Court addressed whether the Settlement Commission’s orders could be rectified under Section 154 of the Income Tax Act. Both parties agreed that, following the precedent set in Brij Lal & Others v. Commissioner of Income Tax (2010), such rectification was not permissible. The court emphasized that the Settlement Commission operates under a distinct procedural code separate from the assessment procedures covered under Chapter XIV, which includes Section 154. The judgment highlighted that the Settlement Commission’s proceedings are akin to arbitration, and its decisions are final under Chapter XIX-A, with no provision for post-settlement rectification under Section 154. The court quashed the order dated November 20, 2003, as it was based on an incorrect application of the rectification provisions. Thus, the petition was allowed, reinforcing the principle that Settlement Commission orders cannot be altered post-facto through rectification processes.
FULL TEXT OF THE JUDGMENT/ORDER OF MADRAS HIGH COURT
Both Mr.R.Kumar, learned counsel, for Mr.T.N.Seetharaman, learned counsel for the petitioner and Mr.A.P.Srinivas, learned Senior Standing Counsel for the respondents would accede to the position that the issue that arises in this matter relating to the assumption of jurisdiction by the Assessing Officer for rectification under Section 154 of an order of the Settlement Commission should be decided adverse to the Department and in favour of the petitioner by virtue of a judgment in the case of Brij Lal and Others v. Commissioner of Income Tax [(2010) 328 ITR 477).
