Moin A Qureshi v. Commissioner Of Income Tax (Central)-Ii And Another

$~ * IN THE HIGH COURT OF DELHI AT NEW DELHI + WRIT PETITION (CIVIL) NO. 4824/2017 Reserved on : 2[nd] May, 2018 Date of decision: 28[th ]August, 2018 MOIN A QURESHI ..... Petitioner Through: Mr. R.K. Handoo, Mr. Yoginder Handoo, Mr. Aditya Chaudhary, Mr. Manish Shukla & Mr. Nishant Kumar, Advocates. versus COMMISSIONER OF INCOME TAX (CENTRAL)-II AND ANOTHER ..... Respondents Through: Mr. Ruchir Bhatia, Sr. Standing Counsel. CORAM: HON'BLE MR. JUSTICE SANJIV KHANNA HON'BLE MR. JUSTICE CHANDER SHEKHAR CHANDER SHEKHAR, J.: This writ petition by Moin A. Qureshi (the petitioner for short) assails the order dated 12[th] May, 2017 under Section 245D(2C) of the Income Tax Act, 1961 (Act, for short) whereby the Income Tax Settlement Commission, W.P.(C) No. 4824/2017 Page 1 of 52 New Delhi (ITSC, for short) has rejected the settlement application filed by the petitioner as invalid. 2.This is the third round of litigation in the High Court from orders passed by the ITSC. The petitioner had earlier filed Writ Petition (C) No. 4900/2015 challenging order of the ITSC dated 24th February, 2015 and Writ Petition (C) No. 8101/2015 impugning orders of the ITSC dated 4th June,2015 and 26th June,2105, which petitions were allowed by the High Court vide the orders dated 18th May,2015 and 13th April,2017, respectively, with remand to the ITSC for a fresh decision. 3.To curtail prolixity, we would refer to only relevant and material facts. The petitioner, it is claimed and stated, was/is engaged in business of manufacture and export of omasum and cattle casing, by-products of animal husbandry, as a sole proprietor of M/s Abdul Majeed Qureshi. Petitioner is also a director in AMQ Agro India Private Limited (AMQ Agro, for short), in which he and his wife Nasreen Moin Qureshi, hold majority (85%) shares. AMQ was/is entirely engaged in exports and its registered office was/is the residence of the petitioner located at C-134, Defence Colony, New Delhi. 4.On 15[th] February, 2014, search and seizure operations under Section 132 of the Act were conducted at various business and residential premises of the petitioner. The search had concluded on 19[th] April, 2014. Survey under Section 133A of the Act was also carried out at different premises. W.P.(C) No. 4824/2017 Page 2 of 52 5.During the course of search, various documents, cash and jewellery were seized. Statements of the petitioner, his family members, employees and directors of associate companies were recorded under Section 132(4) of the Act. The petitioner had surrendered Rs.20 crores before Investigation Wing of the Income Tax Department on 21[st] April, 2014. 6.Consequent to search, tax cases of the petitioner, his family members and associate companies were centralised before the Deputy Commissioner of Income Tax, Central Circle-19, New Delhi, the respondent No. 2 before us. 7.The respondent No.2 had thereupon issued notices under Section 153A of the Act dated 13[th] October, 2014, calling upon the petitioner to file returns for the Assessment Years (AY, for short) 2008-09 to 2013-14. The petitioner, it is stated, had filed returns on or about 4[th] December, 2014. 6.Consequent to search, tax cases of the petitioner, his family members and associate companies were centralised before the Deputy Commissioner of Income Tax, Central Circle-19, New Delhi, the respondent No. 2 before us. 7.The respondent No.2 had thereupon issued notices under Section 153A of the Act dated 13[th] October, 2014, calling upon the petitioner to file returns for the Assessment Years (AY, for short) 2008-09 to 2013-14. The petitioner, it is stated, had filed returns on or about 4[th] December, 2014. 8.On 5[th] December, 2014, the petitioner, his wife Nasreen Moin Qureshi, AMQ Agro and his two employees Mohd. Shahnawaz and Aditya Sharma had moved applications under Section 245C(1) of the Act before the ITSC. These applications were, however, withdrawn with liberty to file fresh applications vide order dated 18[th] December, 2014 passed by the ITSC. The petitioner and four others mentioned above had thereafter filed fresh applications before the ITSC under Section 245C of the Act on 26[th]December, 2014 for the AYs 2008-09 to 2014-15, the period for which notices under Section 153A of the Act had been issued. W.P.(C) No. 4824/2017 Page 3 of 52 9.The applications filed by the petitioner and others were admitted by the ITSC vide order dated 7[th] January, 2014 under Section 245D(1) of the Act. 10.On 10[th] February, 2015, the first respondent, the Commissioner of Income Tax(Central) II, Delhi had filed a report under Section 245D(2B) of the Act asserting and praying that the settlement application of the petitioner should be declared as invalid as there was failure to make full and true disclosure of undisclosed income and the manner in which the undisclosed income was earned. 11.On 19[th] February, 2015, hearing was held before the ITSC for the purpose of passing of order under Section 245D(2C) of the Act. In the post-lunch hearing, the respondents had filed before the ITSC a set of documents running into 260 pages. 12.As per the respondents, arguments were addressed by the parties before the ITSC on 20[th] February, 2015 also. The petitioner, however, claims that arguments were heard in the cases of petitioner and AMQ Agro on 19[th] February, 2015 and arguments in the remaining group of cases including that of Nasreen Moin Qureshi were heard on 20[th] February, 2015. 13.The ITSC vide common order dated 24[th] February, 2015 admitted applications for settlement filed by AMQ Agro, Mohd. Shahnawaz and Aditya Sharma for further consideration, but applications filed by the petitioner and Nasreen Moin Qureshi were rejected on the ground of failure to make full and true disclosure of undisclosed income and the manner in W.P.(C) No. 4824/2017 Page 4 of 52 which the undisclosed income was earned. This order in the case of the petitioner had primarily referred to the documents relied upon by the Respondents relating to property located at 4, Chesterfield House, South Audley, Mayfair, London (London property, for short) and the records and documents received from Singapore Tax Authorities and UK Tax Authorities under the Double Taxation Avoidance Agreement. We shall subsequently refer to these documents. W.P.(C) No. 4824/2017 Page 4 of 52 which the undisclosed income was earned. This order in the case of the petitioner had primarily referred to the documents relied upon by the Respondents relating to property located at 4, Chesterfield House, South Audley, Mayfair, London (London property, for short) and the records and documents received from Singapore Tax Authorities and UK Tax Authorities under the Double Taxation Avoidance Agreement. We shall subsequently refer to these documents. 14.Aggrieved, the petitioner had filed Writ Petition (C) No. 4900/2015 before this High Court, which was allowed vide short order dated 18[th] May, 2015 on the ground that the Respondents had submitted additional set of documents running into 260 pages during the course of hearing before the ITSC on 19[th] February, 2015. The ITSC, it was observed, had passed the order dated 24[th] February, 2015 without further hearing apart from hearing conducted on the next date on 20[th] February, 2015, which included hearing in other group of cases. The Division Bench noted that in the order dated 24[th] February, 2015, the ITSC had relied upon the documents filed by the Respondents on 19[th] February, 2015. However, the High Court also observed that the documents filed on 19[th] February, 2015 constituted a part of the report which the Commissioner, i.e. the second respondent, had initially filed on 10[th] February, 2015. Nevertheless, the High Court felt that as adequate opportunity had not been granted to the petitioner to respond to these documents, an opportunity of hearing should be given. Accordingly, the order dated 24[th] February, 2015 was set aside with direction to the ITSC W.P.(C) No. 4824/2017 Page 5 of 52 to render its decision at the stage of Section 245D(2C) of the Act within ten days from the date of first hearing, which was fixed on 25[th] May, 2015. Before the said date, the petitioner was to submit his response to the documents. The petitioner did not take plea of limitation with regard to additional documents filed on 19[th] February, 2015 and the documents, it was observed, would be construed to be a part of original report dated 10[th]February, 2015. The Court had clarified having not expressed any opinion on merits and that setting aside of the order dated 24[th] February, 2015 shall not come in the way of the ITSC taking a view on the matter. 15.Thereafter, the ITSC vide order dated 4[th] June, 2015 under Section 245D(2C) of the Act held that the settlement application filed by the petitioner was invalid for various reasons, including failure to make full and true disclosure of undisclosed income with reference to the London property and two foreign bank accounts of M/s Barro Holdings Limited and M/s Bulova Holding Limited in the BSI Bank Limited, Singapore, of which the petitioner was a beneficial and the de facto owner. The respondents had thereafter filed an application for rectification in the case of the petitioner, stating that there was a factual mistake and error in paragraph 15.10 of the order dated 4[th] June, 2015. We shall refer to this order and the correction made by the ITSC subsequently. Suffice at this stage, is to record and notice that the application for rectification was allowed ex parte by the ITSC vide order dated 26[th] June, 2015. W.P.(C) No. 4824/2017 Page 6 of 52 W.P.(C) No. 4824/2017 Page 6 of 52 16.Orders dated 4[th] June, 2015 and 26[th] June, 2015 became subject matter of challenge in Writ Petition (C) No. 8101/2015, which petition was allowed vide order dated 13[th] April, 2017 with an order of remand to the ITSC for a fresh decision. We shall be subsequently referring to this order in some detail as the assertion of the petitioner is that the ITSC has not complied with the directions in this order and has misconstrued the same. 17.Pursuant to the second order of the remand, the ITSC has now passed the order dated 12[th] May, 2017, which order holds that the petitioner had failed to make full and true disclosure and, therefore, the settlement application was rejected as invalid under Section 245D(2C) of the Act. The case of the petitioner for the AYs 2009-10 to 2013-14 have been sent to the Assessing Officer for adjudication and passing assessment orders. 18.We would first refer and examine the primary argument of the petitioner, that the impugned order completely disregards and is contrary to the earlier order of the High Court dated 13[th] April, 2017 passed in Writ Petition (C) No. 8101/2015 by which orders of the ITSC dated 4[th] June, 2015 and 26[th] June, 2015 had been set aside. In order to consider the said contention and decide the plea, we would like to reproduce relevant portions of the judgment dated 13[th] April, 2017 passed in Writ Petition (C) No. 8101/2015, which reads:- ―4. The matter then went back to the ITSC. It appears that within four days of the passing of the above order by this Court, the Petitioner tendered a written note of submissions dated 22nd May, 2015 before the ITSC. The Department appears to have objected to the ITSC W.P.(C) No. 4824/2017 Page 7 of 52 considering this written note of submissions. This is evident from para 13.2 of the impugned order. In para 13.3 of the impugned order dated 4th June, 2015 the ITSC observed as under: ―13.3. We have considered the submissions made by the AR and the CIT. The Hon‘ble High Court has remitted the matter back to us to allow an opportunity to the applicant to give his submissions on the entire 260 pages (rest being forwarding letters) which we find relate to the bank accounts at Singapore and the Flat at London. The Commission does not have to travel beyond the directions of the Hon‘ble High Court referred at para 13.2.3 above which unequivocally stated that the said writ petition is allowed to the aforesaid extent....‖ 5. Mr. Handoo, the learned counsel for the Petitioner, submitted that the above written submissions were not considered by the ITSC. This appears to be correct. The Court is unable to find in what manner in the impugned order has the ITSC considered those submissions. The said submissions are significant in view of the two factors adverted to by the ITSC in the impugned order which weighed with it in reiterating its conclusion that the Petitioner had not made a full and true disclosure of all facts within his knowledge. In this connection a reference needs to be made to para 14.3(a) of the impugned order where the ITSC adverts to the two pieces of information that apparently was received by the Department on 20th February, 2015 and 12th March, 2015. Para 14.3 of the impugned order of the ITSC reads as under: W.P.(C) No. 4824/2017 Page 8 of 52 W.P.(C) No. 4824/2017 Page 8 of 52 ―14.3 (a) The issue before us is whether the information received by the Department dated 12.03.2015 by the JS (FT & TR), CBDT and by the DIT (Investigation) on 20.02.2015 relating to the bank account opened/ operated by the applicant is to be taken into consideration during the present proceeding or not. It is the submission of the Department that these two informations are very vital to determine the truth in the matter and it will be fatal on the part of the Commission to ignore the same. It is also the submission of the Department that these two letters relate only to the issue of the bank account and the flat at London which are in consideration and remitted by the Hon‘ble High Court to the Commission. (b) We agree with the submissions made by the Department that these two informations submitted by the Department dated 25.05.2015 with the Commission and received by the Department subsequent dated 19.02.2015 helps the Commission to determine whether the disclosure made by the applicant is full and true or not. Hence these documents require to be considered and the applicant can very well give his comments on these documents....‖ 6. Then from para 15.1 onwards, both the pieces of information are discussed in extenso by the ITSC. In para 15.17 the conclusion drawn by it, as regards the opening of an account, reads as under: ―15.17. If there was a POA (Power of Attorney) arrangement between Mr. Yusuf Mehboob Khan and MR. Qureshi, it was a legal obligation of Mr. Qureshi to provide the alleged POA to the bank, W.P.(C) No. 4824/2017 Page 9 of 52 as the Bank was interested in knowing the profile, background and business interests only of the ‗Real Client‘ and not of an attorney of a client. Thus, the POA and the balance sheets of Barro and Bulova produced in support of ownership of these entities by Mr. Yusuf Mehboob Khan are an afterthought. It is noted that these documents have already been considered and not accepted by the Commission in the earlier order dated 24.02.2015....‖ 7. The next paragraph i.e. para 15.18 deals with purchase of the property in London in respect of which the conclusion drawn by the ITSC reads as under: ―... 15.18. Another very important document which is relied by the Department is an Annexure-C of the submission dated 25.05.2015 of the CIT at page 55 which is an indemnity signed by the applicant Mr. Qureshi to the Board of Directors of Bulova authorising them to purchase the property being Flat NO. 4, Chesterfield House, South Audley Street, London for purchase price of GBP 38,50,000/-. This indemnity also authorized Board of Directors to appoint Solicitor Mischan de Raya for purchase of this property at London. This further establishes that the applicant Mr. Qureshi is the real owner of that flat. Besides that there are lots of e-mails which are part of the submission made by the CIT in their earlier submission and earlier hearing on 10.02.2015 and 19.02.2015 where the approval of artefacts and other furnishing including the carpets have been done by the applicant for which e-mails have been sent to W.P.(C) No. 4824/2017 Page 10 of 52 employees of Sh. Qureshi for his approval. This also corroborates the fact of Sh. Moin Akhtar Qureshi being the real owner of the flat at London and not a power of attorney holder only as it is the real owner who normally approves/ decides, now and with what his flat is to be furnished and not the power of attorney holder....‖ W.P.(C) No. 4824/2017 Page 10 of 52 employees of Sh. Qureshi for his approval. This also corroborates the fact of Sh. Moin Akhtar Qureshi being the real owner of the flat at London and not a power of attorney holder only as it is the real owner who normally approves/ decides, now and with what his flat is to be furnished and not the power of attorney holder....‖ 8. What happened before the ITSC after the passing of impugned the order dated 4th June, 2015 is interesting. It appears that an application was filed, apparently, under ‗Section 154 read with Section 245D(2C) of the Act‘ by the Pr. CIT- Central-II on 12th June, 2015 seeking correction of a factual discrepancy that occurred in para 15.10 of the order dated 4th June, 2015. In order to appreciate what the correction sought was, it is necessary to set out para 15.10 of the order dated 4th June, 2015, which reads as under: ―15.10. All the Bank Account opening forms were signed by Shri Moin Qureshi and his address mentioned is C 134 Defence Colony, –New Delhi 110024, India as seen from page 18 and 19 of pages marked as 7 to 49 received from Singapore authorities. The copies of the passport of Shri Qureshi were enclosed by Singapore authorities. The CIT(DR) argued that Shri Moin Akhtar Qureshi is the beneficial owner of account No. 6CO3122 held by Barro Holdings Ltd. (Barro) with BSI Bank Ltd. Singapore in Form A and that this account was opened on 22.07.2011 and closed on 19.04.2013...‖ W.P.(C) No. 4824/2017 Page 11 of 52 9. The correction now sought was that the acknowledgement of the fact that the bank account opening forms for both Barro Holdings Ltd. and Bulova Holdings Ltd. were not signed by Sh. Moin Akhtar Qureshi but by Arcas Holdings Ltd. ‗the authorized signatory and a director of Barro and Bulova‘. The important change which was sought by the Pr. CIT himself was for the ITSC to now acknowledge that there did exist a Power of Attorney (POA) on record which is now enclosed by the Pr. CIT with its application seeking the correction. 10. This application by the Pr. CIT was heard by the ITSC in the absence of any notice to the Petitioner. The ITSC accepted the application and by its subsequent order dated 26th June, 2015 corrected para 15.10 to read thus: ―15.10. The power of attorney for the management of assets was signed by M/s Arcas Holding Ltd. and Shri Moin Qureshi and his address mentioned is C 134 Defence Colony, –New Delhi 110024, Indas as seen from page 18 and 19 of pages marked as 7 to 49 received from Singapore authorities. The copies of the passport of Shri Qureshi were enclosed by Singapore authorities. The CIT(DR) argued that Shri Moin Akhtar Qureshi is the beneficial owner of account No. 6CO3122 held by Barro Holdings Ltd. (Barro) with BSI Bank Ltd. Singapore in Form A and that this account was opened on 22.07.2011 and closed on 19.04.2013....‖ W.P.(C) No. 4824/2017 Page 12 of 52 11. As a result of the above correction in para 15.10 the conclusion that the Petitioner had not made a full and true disclosure of the facts in respect of the above account, completely changed. There was now an acknowledgement by the ITSC that there was no failure to make a full and true disclosure by the Petitioner as far as the above bank account was concerned. The CIT(DR) argued that Shri Moin Akhtar Qureshi is the beneficial owner of account No. 6CO3122 held by Barro Holdings Ltd. (Barro) with BSI Bank Ltd. Singapore in Form A and that this account was opened on 22.07.2011 and closed on 19.04.2013....‖ W.P.(C) No. 4824/2017 Page 12 of 52 11. As a result of the above correction in para 15.10 the conclusion that the Petitioner had not made a full and true disclosure of the facts in respect of the above account, completely changed. There was now an acknowledgement by the ITSC that there was no failure to make a full and true disclosure by the Petitioner as far as the above bank account was concerned. 12. The question that next arises is whether the above change brought about to the order dated 4th June, 2015 by the subsequent order dated 26th June, 2015 would have an impact on the main conclusion drawn by the ITSC in its order dated 4th June, 2015, that the Petitioner did not make a full and true disclosure of all facts. It will be recalled that there were two pieces of information which were brought before the ITSC by the Department in the second round to persuade the ITSC to hold that there was no full and true disclosure by the Petitioner; one was regarding the bank account and the other was regarding the property at London. As regards the property at London, the case of the Petitioner is that he offered further explanation before the ITSC by his written submissions dated 15th May, 2015 enclosing certain documents and that was never considered by the ITSC. 13. Neither the conclusion in para 15.18 of the order dated 4th June, 2015 or in any other portion of the said order, have the above written submissions of the Petitioner dated 22nd May, 2015 been discussed. 14. The Court is of the considered view that the ITSC ought to have, in the first instance, put the Petitioner on notice if it was going to entertain an application by the Department seeking ‗correction‘ of its order. It is one W.P.(C) No. 4824/2017 Page 13 of 52 thing to state that the said ‗correction‘ was in fact beneficial to the Petitioner since the allowing of the application meant that the Petitioner's case that there was no failure by him to make a full and true disclosure of facts pertaining to the bank account was in fact accepted by the ITSC. But there is also merit in the contention of the learned counsel for the Petitioner that had the Petitioner known of the application, the Petitioner may have been able to persuade the ITSC even as regards the other ‗errors‘ which according to the Petitioner vitiate the impugned order dated 4th June 2015. Whether in fact the ITSC may have been persuaded or not is not the point. The fact remains that an order passed by the ITSC cannot be sought to be ‗corrected‘ by it without putting both parties to the order to notice. The procedure adopted by the ITSC of passing an order ex parte, correcting an earlier order, is not acceptable to the Court. 15. The Court is of the considered view that the ITSC should again undertake the exercise that it was expected to undertake pursuant to the order passed by this Court on 18th May, 2015 in WP(C) No. 4900/2015. Accordingly, the impugned order dated 4th June, 2015 read with the order dated 26th June, 2015 are hereby set aside. The result would be that the exercise that was to be undertaken by the ITSC as a result of the order passed by this Court on 18th May, 2015 will have to be undertaken by it afresh. This time round there will be no further documents filed either by the Department or by the Petitioner. On the basis of the existing documents, the ITSC will, after giving opportunity of being heard to both the parties, pass a fresh decision on merits, in accordance with law. The 15. The Court is of the considered view that the ITSC should again undertake the exercise that it was expected to undertake pursuant to the order passed by this Court on 18th May, 2015 in WP(C) No. 4900/2015. Accordingly, the impugned order dated 4th June, 2015 read with the order dated 26th June, 2015 are hereby set aside. The result would be that the exercise that was to be undertaken by the ITSC as a result of the order passed by this Court on 18th May, 2015 will have to be undertaken by it afresh. This time round there will be no further documents filed either by the Department or by the Petitioner. On the basis of the existing documents, the ITSC will, after giving opportunity of being heard to both the parties, pass a fresh decision on merits, in accordance with law. The W.P.(C) No. 4824/2017 Page 14 of 52 ITSC will pass an order uninfluenced by any of its earlier orders that have been set aside by this Court.‖ 19.We have reproduced the entire reasoning in the order on record dated 13[th] April, 2017 in the aforesaid quotation so as to appreciate and understand the contention raised and our reasons. Paragraph 5 of the aforesaid quotation refers to the contention of the counsel for the petitioner that written submissions had not been considered, which it was observed appeared to be correct for the ITSC had not set out the manner in which those submissions were considered. Thereafter, reference was made to the information received by the Revenue and relied upon in relation to the bank accounts and the property at London. Paragraph 6 of the said order states that information received had been discussed inextenso by the ITSC before drawing their conclusion and findings in paragraphs 15.17 and 15.18. 20.Thereafter, reference was made to the rectification application filed by the respondents, purportedly for correction of factual mistake and error in paragraph 15.10 of the order dated 4[th] June, 2015, which had recorded that the bank account opening forms were signed by the petitioner, i.e., Moin Akhar Qureshi and his address was mentioned as C-134, Defence Colony, New Delhi as was seen from papers received from the Singapore authorities, including the passport. Paragraph 9 of the order dated 13[th] April, 2017 observes that the account opening forms of M/s Barro Holdings Limited and M/s Bulova Holdings Limited were signed by M/s Arcas Holdings Limited, W.P.(C) No. 4824/2017 Page 15 of 52 the authorised signatory and director of the two companies and not by the petitioner, i.e., Moin Akhtar Qureshi. W.P.(C) No. 4824/2017 Page 15 of 52 the authorised signatory and director of the two companies and not by the petitioner, i.e., Moin Akhtar Qureshi. 21.For the time being, we would skip the observations made by the Division Bench in paragraphs 10 and 11, but refer to the reasoning given in paragraph 12. Paragraph 12 of the order dated 13[th] April, 2017 refers to the fact that the rectification application filed by the Revenue was allowed ex parte vide order dated 26[th] June, 2015. The Division Bench felt that question would arise whether the above change or rectification would impact the main conclusion drawn by the ITSC in its order dated 4[th] June, 2015 that there was failure to make true and full disclosure of all facts. It was observed that ITSC on two grounds had held that there was failure to make full and true disclosure, namely, the bank accounts in Singapore and the property at London. With regard to the property at London, paragraph 12 observes that the petitioner had made written submissions dated 15[th] May, 2015 enclosing certain documents, which were not considered. Paragraph 13 states that the order dated 4[th] June, 2015 had also not considered written submissions dated 22[th] May, 2015. Paragraph 14 thereupon states and records that the ITSC ought to have, at the first instance, put the petitioner on notice if it was going to entertain an application for correction filed by the Respondents. It did not matter whether the corrections would have been beneficial to the petitioner for it was observed that the petitioner could have persuaded the ITSC with regard to other errors, which according to the petitioner had vitiated the order dated 4[th] June, 2015. The Court felt that W.P.(C) No. 4824/2017 Page 16 of 52 ITSC could not have corrected the order dated 4[th] June, 2015 without putting both parties to notice and the procedure of passing an ex parte order correcting an earlier order was unacceptable. Accordingly, both orders dated 4[th] June, 2015 and 26[th] June, 2015 were set aside with the direction that the ITSC would undertake a fresh exercise in terms of the first order dated 18[th]May, 2015 passed in Writ Petition (C) No. 4900/2015. It was also directed that parties would not file additional or further documents and the matter would be decided on the basis of existing documents after giving hearing. Fresh decision was to be on merits and in accordance with the law without being influenced by the earlier orders, which had been set aside. 22.As noticed above, we have not, till now, referred to and elucidated on paragraphs 10 and 11 of the decision dated 13[th] April, 2017 in Writ Petition (C) No. 8101/2015. The petitioner relies on the observations made in these paragraphs. In particular, our attention was drawn to the observations in paragraph 11 of this order, which records ―there was now an acknowledgement by the ITSC that there was no failure to make a full and true disclosure by the petitioner as far as the above bank account was concerned‖. 23.Having considered the said contention, we find that the petitioner is misreading the aforesaid observations out of context for it was never the case of the Revenue, i.e. the respondents, that the account opening forms with BSI Bank Limited, Singapore were signed by the petitioner Moin Akhtar Qureshi as the director of the said companies. The case set up and W.P.(C) No. 4824/2017 Page 17 of 52 23.Having considered the said contention, we find that the petitioner is misreading the aforesaid observations out of context for it was never the case of the Revenue, i.e. the respondents, that the account opening forms with BSI Bank Limited, Singapore were signed by the petitioner Moin Akhtar Qureshi as the director of the said companies. The case set up and W.P.(C) No. 4824/2017 Page 17 of 52 pleaded by the respondents was that bank accounts of M/s Barro Holdings Limited and M/s Bulova Holdings Limited at Singapore were opened by M/s Arcas Holding Limited as a director of these companies. However, Moin Akhtar Qureshi, i.e., the petitioner, has been shown and declared as the beneficial owner of these companies. He has signed and made declaration on oath in this regard. Photocopy of his passport was also enclosed with confirmation in the Know Your Customer documentation. 24.On the said aspect, it would be appropriate to refer to the first order dated 24[th] February, 2015 passed by the ITSC, which had in paragraph 4.3 referred to the contention of the Revenue that M/s Bulova Holdings Limited, a company incorporated in British Virgin Island, had purchased the London property. However, the petitioner was a beneficial owner of M/s Bulova Holdings Limited and he had given instructions for furnishing of London property in his capacity as a beneficial owner. Similarly, order dated 4[th]June, 2015 records that the petitioner was beneficial owner of M/s Barro Holdings Limited and M/s Bulova Holdings Limited as well as the owner of the flat at London. ITSC had relied upon Know Your Customer (KYC) details in the account opening form. The petitioner had questioned the said details with reference to the two accounts alleging discrepancies, which contention was rejected in view of the fact that the details recorded in the KYC included personal details, etc. The ITSC had also recorded that M/s Barro Holdings Limited had executed a power of attorney in favour of the W.P.(C) No. 4824/2017 Page 18 of 52 petitioner, which was signed by the petitioner and his signatures on the documents with the BSI Bank Limited, Singapore were not disputed. 25.Therefore, it is clear that the stand of the Revenue, i.e. the respondents, was that the petitioner was a beneficial owner of the two bank accounts in Singapore and the London property though the bank accounts in the name of M/s Bulova Holdings Limited and M/s Barro Holdings Limited were opened by M/s Arcas Holding Limited. Further, the London property registered in the name of M/s Bulova Holdings Limited, was belonging to and was owned by the petitioner. However, there was a factual error made by the ITSC in paragraph 15.10 of the order dated 4[th] June, 2015 in recording that the account opening forms were signed by the petitioner and his address was mentioned as C-134, Defence Colony, New Delhi, whereas the factual position was that the petitioner had signed and affirmed that he was a beneficial owner of the accounts and given personal details though he had not signed the account opening forms on behalf of M/s Bulova Holdings Limited and M/s Barro Holdings Limited. Reference in paragraph 11, therefore, was limited and with reference to the aforesaid correction made vide order dated 26[th] June, 2015. We do not think that the aforesaid observation can be treated as a final and conclusive finding given by the High Court that the petitioner had made full and true disclosure in the settlement application before the ITSC with reference to the two accounts. There is no discussion in this order dated 13[th] April, 2017 on the said aspect. W.P.(C) No. 4824/2017 Page 19 of 52 W.P.(C) No. 4824/2017 Page 19 of 52 26.In the State of U.P. v. Synthetics and Chemicals Ltd., 1991 (3) SCR 64, the Supreme Court has held that any declaration or conclusion arrived without application of mind or preceded without any reason would not tantamount to a declaration of law which binds all Courts. The relevant paragraph of the aforesaid judgment is reproduced as under: “41. Does this principle extend and apply to a conclusion of law, which was neither raised nor preceded by any consideration. In other words can such conclusions be considered as declaration of law? Here again the English courts and jurists have carved out an exception to the rule of precedents. It has been explained as rule of sub-silentio. “A decision passes sub-silentio, in the technical sense that has come to be attached to that phrase, when the particular point of law involved in the decision is not perceived by the court or present to its mind.” (Salmond on Jurisprudence 12th Edn., p. 153). In Lancester Motor Company (London) Ltd. v. Bremith Ltd. the Court did not feel bound by earlier decision as it was rendered „without any argument, without reference to the crucial words of the rule and without any citation of the authority‟. It was approved by this Court in Municipal Corporation of Delhi v. Gurnam Kaur. The bench held that, „precedents sub-silentio and without arguments are of no moment‟. The courts thus have taken recourse to this principle for relieving from injustice perpetrated by unjust precedents. A W.P.(C) No. 4824/2017 Page 20 of 52 decision which is not express and is not founded on reasons nor it proceeds on consideration of issue cannot be deemed to be a law declared to have a binding effect as is contemplated by Article 141. Uniformity and consistency are core of judicial discipline. But that which escapes in the judgment without any occasion is not ratio decidendi. In B. Shama Rao v. Union Territory of Pondicherry it was observed, „it is trite to say that a decision is binding not because of its conclusions but in regard to its ratio and the principles, laid down therein‟. Any declaration or conclusion arrived without application of mind or preceded without any reason cannot be deemed to be declaration of law or authority of a general nature binding as a precedent. Restraint in dissenting or overruling is for sake of stability and uniformity but rigidity beyond reasonable limits is inimical to the growth of law.” 27.We would also like to reproduce a portion from the judgment of the Supreme Court in Deepak Bajaj versus State of Maharashtra and Another, (2008) 16 SCC 14, wherein it was held that decisions of the Court cannot be read as Euclid‘s theorem and the wording and the language used in the judgment has to be read with care and caution with reference to controversy/issue settled and decided. Relevant paragraphs in Deepak Bajaj (Supra)read as under:- W.P.(C) No. 4824/2017 Page 21 of 52 "7. It is well settled that the judgment of a court is not to be read mechanically as a Euclid's theorem nor as if it were a statute. ―14. On the subject of precedents Lord Halsbury, L.C., said in Quinn v. Leathem [1901 AC 495 : (1900-03) All ER Rep 1 (HL)] : (All ER p. 7 G-I) W.P.(C) No. 4824/2017 Page 21 of 52 "7. It is well settled that the judgment of a court is not to be read mechanically as a Euclid's theorem nor as if it were a statute. ―14. On the subject of precedents Lord Halsbury, L.C., said in Quinn v. Leathem [1901 AC 495 : (1900-03) All ER Rep 1 (HL)] : (All ER p. 7 G-I) ‗[Now before] discussing Allen v. Flood [1898 AC 1 : (1895-99) All ER Rep 52 (HL)] and what was decided therein, there are two observations of a general character which I wish to make; and one is to repeat what I have very often said —beforethat every judgment must be read as applicable to the particular facts proved or assumed to be proved, since the generality of the expressions which may be found there are not intended to be expositions of the whole law, but are governed and qualified by the particular facts of the case in which such expressions are to be found. The other is that a case is only an authority for what it actually decides. I entirely deny that it can be quoted for a proposition that may seem to follow logically from it. Such a mode of reasoning assumes that the law is necessarily a logical code, whereas every lawyer must acknowledge that the law is not always logical at all.‘ (emphasis in original) We entirely agree with the above observations. W.P.(C) No. 4824/2017 Page 22 of 52 15. In Ambica Quarry Works v. State of Gujarat [(1987) 1 SCC 213] (vide SCC p. 221, para 18) this Court observed: ‗18. … The ratio of any decision must be understood in the background of the facts of that case. It has been said long time ago that a case is only an authority for what it actually decides, and not what logically follows from it.‘ 16. In Bhavnagar University v. Palitana Sugar Mill (P) Ltd. [(2003) 2 SCC 111] (vide SCC p. 130, para 59) this Court observed: ‗59. … It is also well settled that a little difference in facts or additional facts may make a lot of difference in the precedential value of a decision.‘ (emphasis in original) 17. As held in Bharat Petroleum Corpn. Ltd. v. N.R. Vairamani [(2004) 8 SCC 579 : AIR 2004 SC 4778] a decision cannot be relied on without disclosing the factual situation. In the same judgment this Court also observed: (SCC pp. 584-85, paras 9-12) ‗9. Courts should not place reliance on decisions without discussing as to how the factual situation fits in with the fact situation of the decision on which reliance is placed. Observations of courts are neither to be read as Euclid's theorems nor as provisions of a statute and that too taken out of their context. (emphasis in original) These observations must be read in the context in which they appear to have been stated. Judgments of courts are not to be construed as W.P.(C) No. 4824/2017 Page 23 of 52 statutes. To interpret words, phrases and provisions of a statute, it may become necessary for Judges to embark into lengthy discussions but the discussion is meant to explain and not to define. Judges interpret statutes, they do not interpret judgments. They interpret words of statutes; their words are not to be interpreted as statutes. (emphasis supplied) In London Graving Dock Co. Ltd. v. Horton [1951 AC 737 : (1951) 2 All ER 1 (HL)] (AC at p. 761), Lord MacDermott observed: (All ER p. 14 C-D) ―… The matter cannot, of course, be settled merely by treating the ipsissima verba of Willes, J. as though they were part of an Act of Parliament and applying the rules of interpretation appropriate thereto. This is not to detract from the great weight to be given to the language actually used by that most distinguished Judge, …‖ 10. In Home Office v. Dorset Yacht Co. Ltd. [1970 AC 1004 : (1970) 2 WLR 1140 : (1970) 2 All ER 294 (HL)] Lord Reid said: ―… The matter cannot, of course, be settled merely by treating the ipsissima verba of Willes, J. as though they were part of an Act of Parliament and applying the rules of interpretation appropriate thereto. This is not to detract from the great weight to be given to the language actually used by that most distinguished Judge, …‖ 10. In Home Office v. Dorset Yacht Co. Ltd. [1970 AC 1004 : (1970) 2 WLR 1140 : (1970) 2 All ER 294 (HL)] Lord Reid said: ―… Lord Atkin's speech … is not to be treated as if it were a statutory definition. It will require qualification in new circumstances.‖ Megarry, J. in Shepherd Homes Ltd. v. Sandham (No. 2) [(1971) 1 WLR 1062 : (1971) 2 All ER 1267] observed: (All ER p. 1274 d) ―… One must not, of course, construe even a reserved judgment of even Russell, L.J. as if it were an Act of Parliament;‖ W.P.(C) No. 4824/2017 Page 24 of 52 And, in British Railways Board v. Herrington [1972 AC 877 : (1972) 2 WLR 537 : (1972) 1 All ER 749 (HL)] Lord Morris said: (All ER p. 761 c) ―… There is always peril in treating the words of a speech or a judgment as though they were words in a legislative enactment, and it is to be remembered that judicial utterances are made in the setting of the facts of a particular case." 28.The controversy and issue in the Writ Petition (C) No. 8101/2015 in view of the reasoning quoted above was predicated on two aspects. Firstly, the correction to the order dated 4[th] June, 2015 was by an ex parte order passed by the ITSC dated 26[th] June, 2015 without notice, which was contrary to law for the reasons set out in paragraph 14 of the order dated 13[th]April, 2017. Secondly, the High Court felt that the ITSC had not considered the written submissions filed by the petitioner. 29.We would turn our attention to the second contention raised by the petitioner that the impugned order dated 12[th] May, 2017 is erroneous and wrong for it relies upon order dated 24[th] February, 2015, which was set aside vide order dated 18[th] May, 2015 in Writ Petition (C) No. 4900/2015. It is submitted that the ITSC has committed a grav