Shyam Glass Works vs Income Tax Settlement Commission

Heard Sri C.S. Agarwal, learned counsel for the petitioner, and Sri Bharat Ji Agarwal, learned senior standing counsel for the respondents. By this petition, the petitioner seeks a writ of certiorari quashing the order dated June 28, 1996, of the income tax Settlement Commission, New Delhi, whereby the application of the petitioner u/s 245C(1) of the income tax Act, 1961, was rejected after recording the finding that it could not be said that the petitioner had made full and true disclosure of the income which had not been known to the Department. The Commission also said that after considering the report of the Commissioner of income tax, the complexity of investigation involved and the nature and circumstances of the case, the application was liable to be rejected and not allowed to be proceeded with.

Learned counsel for the petitioner submits that the investigation would involve consideration of certain complex questions and the Settlement Commission has dealt with the petitioner in an arbitrary manner by not allowing the application. We see no material on the record to arrive at a finding contrary to the finding of the Settlement Commission that the petitioner did not make full and true disclosure of the income which was not known to the Department. Furthermore, whether the application u/s 245C(1) should or should not be allowed, is a matter which is to be decided by the Settlement Commission giving due weight to the matters mentioned therein and in section 245D. The writ court is concerned with the legality of the procedure followed, that is, the decision-making process and not with the merits of the order. In this case, we do not find that the Settlement Commission had not followed the procedure required to be followed. The petition is dismissed in limine.