Commissioner Of Income Tax,Central – Vii v. Income Tax Settlement Commission, 640, Anna Salai, Nandanam, Chennai – 600 035

IN THE HIGH COURT OF JUDICATURE AT MADRAS CORAM THE HONOURABLE MR.JUSTICE S.M.SUBRAMANIAM Commissioner of Income Tax,Central – VII,No.121, Uthamar Gandhi Salai,Chennai – 600 034. ...Petitioner Vs 1. Income Tax Settlement Commission, 640, Anna Salai, Nandanam, Chennai – 600 035. 2. G.Rajam Chetty & Sons, 28B, West Raja Street, Kancheepuram – 631 501. ... Respondents PRAYER : Writ Petition filed Under Article226 of theConstitution of India to issue of Writ of Certiorari, callingfor the records on the file of the first respondent inTN/CN.8/2012-13/4/IT dated 26.07.2013 and quash the same so faras the same is against revenue as illegal and beyondjurisdiction and authority of the first respondent. For Petitioner: Mr.Prabhumukunth Arunkumar For Respondent : R1 – No appearance R2 – Mr.Raghav menon For Mr.R.Sivaraman The order passed by the first respondent / SettlementCommission in proceedings dated 26.07.2013 is under challenge inthe present writ petition. 2. The learned counsel appearing on behalf of the writpetitioner made a submission that based on certain incorrectfacts, an error crept in, in the order passed by the firstrespondent / Settlement Commission. In this regard, thepetitioner has stated that the first respondent erred in holdingthat the second respondent / assessee's contention wasacceptable based on the verification of Revenue, wherein, CIT (DR) accepted that the customer gold weighing 14499.40 gms. waswrongly shown as second respondent's own gold. It is contendedthat the first respondent has failed to see the verificationreport clearly, which shows that in the absence of customer'ssignature in the delivery challan and in the absence of receiptsissued by the second respondent for receipt of old gold from thecustomers, the authenticity of the claim was neither verifiablenor acceptable. 3. Citing these mistakes, the learned counsel for thepetitioner reiterated that the order passed by the SettlementCommission is perverse as the findings cannot be construed as aSettlement. It is further contended that during the course ofdecision making, the first respondent has not considered thefacts as pleaded and in fact, the facts plays are erroneouslyconsidered by the first respondent. The said facts are stated inParagraph 5 of the affidavit filed in support of the writpetition, which reads as under: “5. It is submitted the Learned CIT (DR), whoappeared for the revenue at no point of time acceptedthe above contention of the second respondent/assesseeas observed by the first respondent herein. On theother hand, the Learned CIT (DR) based on theverification report dated 11.07.2013 filed by thepetitioner as per the direction of the firstrespondent, had specifically pointed out that thecontention of the petitioner that the customer goldweighing 14499.40 gms. was wrongly shown as secondrespondent's own gold is not correct. The relevantportion of the verification report is as under:“In view of the above, I am of the view that inthe absence of customer's signature in the deliverychallan, and in the absence of the receipts issued bythe assessee to different customers from whom theassessee claimed to have received old gold, theauthenticity of the receipt of old gold from thecustomers is not fully verifiable. Hence the assessee'sclaim is not acceptable.” 4. Based on the mistake crept in, immunity was granted infavour of the second respondent. Thus, the petitioner isconstrained to move the present writ petition. 4. Based on the mistake crept in, immunity was granted infavour of the second respondent. Thus, the petitioner isconstrained to move the present writ petition. 5. The learned counsel for the second respondent opposed thesaid contention by stating that there is a delay of more thansix months in filing the writ petition and further, the writpetition against an order of Settlement Commission is notmaintainable. The learned counsel for the second respondentreiterated that the statement made by the Income Tax officials https://hcservices.ecourts.gov.in/hcservices/ are taken into consideration by the Settlement Commission in aright perspective and immunity was granted. Thus, there is noinfirmity or perversity as such and instead of filing aclarification petition under the Provisions of the Income TaxAct, the petitioner has chosen to file the present writ petitionand thus, the writ petition is liable to be rejected. 6. This Court is of the considered opinion that the delay ofabout six months in filing a writ petition by the petitioner /Department cannot be considered as enormous, so as to reject thewrit petition at the threshold. The ground raised in the writpetition is that based on certain incorrect facts and details,immunity was granted in favour of the second respondent, whichcaused prejudice to the interest of the Revenue. Thus, thepetitioner has chosen to file the present writ petition as suchmistakes crept in cannot be rectified by filing a clarificationpetition. However, this Court cannot adjudicate the disputedfacts in the present writ proceedings as the adjudication wasmade before the Settlement Commission in the presence of theparties. What is transpired and the manner in which the factsrecorded and the errors identifiable is the findings, to beconsidered by the Settlement Commission itself. 7. Under these circumstances, this Court is of an opinionthat the case on hand is a fit case for remand and the groundsraised in the writ petition is to be considered by theSettlement Commission for the purpose of consideration andpassing fresh orders. 8. In this view of the matter, the order impugned passed bythe first respondent in proceedings in TN/CN.8/2012-13/4/ITdated 26.07.2013 is quashed and the matter is remitted back tothe first respondent for fresh consideration. The petitioner ispermitted to submit their objections / documents or evidencesbefore the first respondent and the second respondent is alsopermitted to submit their explanations / objections anddocuments and the first respondent shall adjudicate the issueson merits and in accordance with law and by affordingopportunity to all the parties and dispose of the matter asexpeditiously as possible. 9. With these observations, the writ petition standsallowed. No costs. Sd/- Assistant Registrar(CS V) //True Copy// Kak Sub Assistant Registrar To The Income Tax Settlement Commission,640, Anna Salai, Nandanam,Chennai – 600 035. +1cc to Mr.Hema Muralikrishnan, Advocate, S.R.No.39895 W.P.No.3297 of 2014 KSM(CO)CT/01/09/2021