Judgement

B. P. JEEVAN REDDY, J. :— The order of the Settlement Commission dated October 15, 1980, has given rise to these appeals. Kuldeep Industrial Corporation had filed an application under Section 245-C of the Income-tax Act in respect of three assessment years 1977-78, 1978-79 and 1979-80. The Settlement Commission refused to admit the case relating to assessment year 1977-78 for settlement against which the assessee has filed Civil Appeals 233-35 of 1982, (Civil Appeals 236-237 of 1982). The Settlement Commission has, however, admitted the case relating to the other two assessment years for settlement, against which the Revenue has preferred Civil Appeals 238-239 of 1982.

2. During the previous year relevant to the said three assessment years, the assessee received substantial quantities of stainless steel sheets from M. M. T. C. claiming to be a manufacturer of sterilizers. It filed returns for the said three assessment years disclosing losses in a sum of Rs. 1,51,143/- (for A. Y. 1977-78), Rs. 39,939/- for (A. Y. 1978-79) and a profit of Rs. 7,340/- (for the A. Y. 1979-80). Certain inquiries were made by the Income-tax Officer in Month of December, 1979. She also impounded t