Point of Law: Provisions of Section 245-K make it clear that an application for settlement is a one-time measure, and further applications for settlement will not be entertained at instance of assessee.

JUDGMENT :

1. The petitioner has approached this Court being aggrieved by Ext.P12 order of the Income Tax Settlement Commission (1st respondent) through which the application filed by the petitioner for settlement has been rejected.

2. The brief facts are that, on 05.08.2016, there was a search and seizure under Section 132 of the Income Tax Act (In short 'the Act') in various business premises of the petitioner. The petitioner opted to settle the issues by adopting the procedure under Chapter XIX A of the Income Tax Act, 1961 [‘the Act’ - as it stood at the relevant time]. The period for which the application was filed relate to the Assessment Years 2010-11 to 2017-18. In the application before the Settlement Commission, the petitioner made disclosures under the following three heads:-

“(i) ' Excess realisation of gold':- This is stated to be the difference between the gold which was shown in the records of the petitioner as sold for the realisation of amounts due under gold loans availed by its customers and the actual quantity of gold sold during the relevant period. In other words, the disclosure referred to the excess of gold sold over and above the accounted figures. The petitioner disclosed Rs.85.37 Crores as income under this head;

(ii) An ad-hoc voluntary disclosure of Rs.2 Crores; and

(iii) ‘Dis-allowance of interest on debentures amounting to Rs.109.92 Crores ’ :- This represents the income received by the petitioner on account of late disbursement of interest on debentures issued by the petitioner from time to time.”

3. The petitioner's application before the Settlement Commission passed through the 1st stage under Section 245D(1) of the Act, after the commission was satisfied that proceedings were pending for the years in question, there was a full and true disclosure (prima facie) and on a finding that the tax liability arising out of the disclosures (mentioned above) had been remitted in full by the petitioner. The Settlement Commission thereafter directed the 2nd respondent to file a report as contemplated under Section 245D(2B) of the Act. However, the 2nd respondent chose not to file any report under Section 245D(2B) of the Act. The application, therefore, proceeded to the final stage of adjudication. At that stage, the 2nd respondent filed a report as contemplated by Section 245-D(3) of the Act, where four objections were raised to the application for settlement. One objection was that the petitioner had not provided for interest on non-performing assets. It was pointed out that since the petitioner was following the mercantile system of accounting as opposed to the cash system, the petitioner was required to disclose, as income, the interest accruing on Non-Performing Assets. It was pointed out that during search and seizure, the Managing Director of the petitioner had agreed that such disclosure would be made. Another objection was regarding the disclosure on account of excess realisation of gold, as explained above. According to the 2nd respondent, the purity of gold sold in auction, which has a huge impact on the income realised by the petitioner under this head, was shown as 80%. It was pointed out that in respect of a transaction relating to one P.M.Reji, the Branch Manager of the petitioner had accepted that the purity of gold pledged by the aforesaid P.M.Reji was about 85%. This document was, according to the 2nd respondent, sufficient to establish that the petitioner had not made a full and true disclosure which alone would entitle it to have the case settled at the hands of the Settlement Commission. Based on the findings of the aforesaid two issues the Settlement Commission has rejected the application filed by the petitioner for settlement, on the finding that there was no ‘full and true disclosure’. The other objections raised by the 2nd respondent need not be discussed here because those objections do not form part of the reasons for rejecting the application for settlement.

4. The petitioner init