Sri. Umed C.mehta v. Income Tax Settlement Commission, Additional Bench, Sathguru Complex, 640, Anna Salai, Chennai

IN THE HIGH COURT OF JUDICATURE OF MADRAS DATED: 09.08.2019 CORAM: THE HONOURABLE MR. JUSTICE M.S. RAMESH W.P.No.23631 of 2009 andM.P.Nos.1 of 2009 & 1 of 2010 Sri. Umed C.Mehta ...PetitionerVs 1. Income Tax Settlement Commission, Additional Bench, Sathguru Complex, 640, Anna Salai, Chennai - 600035. 2. Commissioner of Income Tax-VII, 121, M.G.Road, Nungambakkam, Chennai - 600034....Respondents PRAYER: Writ Petition filed under Article 226 of theConstitution of India, praying to issue a writ of Certiorari, tocall for the records pertaining to the Settlement ApplicationNo.TN/CN7/2009-10/2/IT on the file of the Income Tax SettlementCommission, Additional Bench, Chennai - 600035, the firstrespondent herein and quash the order passed therein dated23.10.2009.For Petitioner : Mr.V.S.Jayakumar For Respondents: Mr.J.Narayanasamy, SSC O R D E R When the petitioner had filed a Settlement Application No.TN/CN7/2009-10/2/IT before the Income Tax Settlement Commission,who is the 1[st] respondent herein, he had stated that theundisclosed income admitted in the Settlement Application was acommission earned from accommodation transaction withMr.Parasmal Jain of M/s.Kawarlal Group. This explanation wasdisbelieved and the Settlement Application came to be rejectedon 23.10.2009. As against the rejection order of the 1[st]respondent, the petitioner has filed this writ petition. 2. Though the petitioner has raised several grounds in thewrit petition, the learned counsel would submit that theaforesaid Mr.Parasmal Jain, during the pendency of the writpetition, had filed a Settlement Application before the IncomeTaxSettlementCommissioninSettlementApplicationNo.TN/CN51/2014-15/24-30/IT, wherein the very same incomeadmitted by Umed C.Mehta has been dealt with in that proceedingsand the application came to be disposed of. In view of the orderpassed by the Settlement Commission in the case of ParasmalJain, the respondents cannot tax the petitioner herein on thesame transaction, which would result in double taxation. Hence,he would submit that the order of the Settlement Commissionpassed in the case of the petitioner herein requires to be re-visited. 3. Per contra, the learned Standing Counsel for therespondents submitted that the proceedings pertaining to thepetitioner herein before the Settlement Commission are in thenature of admonition and discretionary proceedings and thereforethe findings that the income offered in one case, cannot beautomatically applied and deducted in other cases, even thoughthe transactions are one and the same and that the partiesapproaching the Commission should independently satisfy theCommission on all other criteria mandated under the provisionsof the Income Tax Act. Hence, the learned Standing Counsel wouldobject to the petitioner counsel's request for remand 4. The order of the Settlement Commission, in the case ofParasmal Jain, was pursuant to the orders of the SettlementCommission in the case of the petitioner herein. It is not indispute that the transactions pertaining to the undisclosedincome of the petitioner herein is also the subject matter ofthe Settlement Application in the case of Parasmal Jain. If thatbeing so, there is a possibility that such a subsequentconsideration by the Settlement Commission could be deemed asdouble taxation, in case the order dated 23.10.2009 passed bythe Settlement Commission in the case of the petitioner herein,is upheld. 4. The order of the Settlement Commission, in the case ofParasmal Jain, was pursuant to the orders of the SettlementCommission in the case of the petitioner herein. It is not indispute that the transactions pertaining to the undisclosedincome of the petitioner herein is also the subject matter ofthe Settlement Application in the case of Parasmal Jain. If thatbeing so, there is a possibility that such a subsequentconsideration by the Settlement Commission could be deemed asdouble taxation, in case the order dated 23.10.2009 passed bythe Settlement Commission in the case of the petitioner herein,is upheld. 5. It is also stated that the order passed in the case ofParasmal Jain by the Settlement Commission has become final.While that being so, if the objections of the learned StandingCounsel for the respondents is to be accepted, the possibilityof double taxation for one transaction may occur. As such, thisCourt is of the view that the issue in the case of thepetitioner herein could be reconsidered, in the light of thesubsequent development through the orders passed by theSettlement Commission in the case of Parasmal Jain.Consequently, I deem it proper to refrain from addressing anyother grounds raised by the petitioner, challenging the impugned proceedings in this writ petition and that any further decisioncould await, after final orders are passed by the SettlementCommission on remand. 6. In the light of the above discussions, the impugnedorder dated 23.10.2009 is set aside and the matter is remandedback to the Income Tax Settlement Commission for freshconsideration. The petitioner is granted liberty to file arejoinder to his original application, along with any othersupporting documents before the 1[st] respondent-Commission, withina period of 15 days from the date of receipt of a copy of thisorder. On receipt of such a rejoinder, if any, the Income TaxSettlement Commission shall consider the same in accordance withlaw and pass fresh orders, without reference to its earlierproceedings dated 23.10.2009, as expeditiously as possible. 7. Accordingly, the writ petition stands allowed. No costs.Consequently, connected miscellaneous petitions are closed. Sd/-Assistant Registrar (CS-V)//True Copy//Sub Assistant Registrar hvkTo 1. Income Tax Settlement Commission, Additional Bench, Sathguru Complex, 640, Anna Salai, Chennai - 600035. 2. Commissioner of Income Tax-VII, 121, M.G.Road, Nungambakkam, Chennai – 600034. +1cc to Mr.V.S.Jayakumar, Advocate, S.R.No. 68655+1cc to Mr.J.Narayanaswamy, Advocate, S.R.No. 69442 GJ II(CO)GN(10/10/2019)