PRINCIPAL COMMISSIONER OF INCOME TAX, CENTRAL V. INCOME TAX SETTLEMENT COMMISSION

SCA/9883/2019

AI Insights

The case revolves around the challenge by the Principal Commissioner of Income Tax, Central, Surat against the order passed by the Income Tax Settlement Commission concerning undisclosed foreign income and assets of the respondents, who are promoters of the Banco Group of Companies. The main legal contention was whether the Settlement Commission had jurisdiction to pass an order under the IT Act for undisclosed foreign income and assets, which are also covered under the Black Money Act. The court examined the provisions of both the IT Act and the Black Money Act, along with the submissions made by both parties, and concluded that the Settlement Commission acted within its jurisdiction and the respondents had made a full and true disclosure.

• Counselvise Citation: [2019] 140 COUNSELVISE.COM (IT) 750594 (HC-GUJARAT)
• Appeal Type: Others
• Pronouncement Date: 22-10-2019
• Assessment Year: misc
• Other Referred Cases: Union of India v. Gautam Khaitan, Ajmera Housing Corporation and another v. Commissioner of Income Tax, Principal Commissioner of Income Tax-9 vs. Om Prakash Jakhotia & Anr, Maharshi Dayanand University vs. Surjeet Kaur, Collector v. Cine Exhibitors (P) Ltd., Commercial Tax Officer, Rajasthan v. Binani Cements Limited and Another, Whirlpool Corporation v. Registrar of Trade Marks, A. V. Fernandez v. State of Kerala
• Laws Referred To: Income Tax Act, 1961, Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015
• Result in Favour of: Partly Allowed
• Court: HIGH COURT
• Department Lawyers: S GANESH; S N SOPARKAR
• Assessee Lawyers: SANJAY JAIN
• Keywords: Black Money Act; Income Tax Act; Jurisdiction challenge; Settlement commission; Undisclosed Foreign Income
• Section: 245C(1); 245D(4); 245D(2C); 226; 245D(1); 245D(3); 227; 245D(6A)

Judgement Text

"C/SCA/9883/2019 JUDGMENT IN THE HIGH COURT OF GUJARAT AT AHMEDABAD R/SPECIAL CIVIL APPLICATION NO. 9883 of 2019 FOR APPROVAL AND SIGNATURE: HONOURABLE MS.JUSTICE HARSHA DEVANI and HONOURABLE MS. JUSTICE SANGEETA K. VISHEN ========================================================== 1 Whether Reporters of Local Papers may be allowed to see the judgment ? Yes 2 To be referred to the Reporter or not ? Yes 3 Whether their Lordships wish to see the fair copy of the judgment ? No 4 Whether this case involves a substantial question of law as to the interpretation of the Constitution of India or any order made thereunder ? No ========================================================== PRINCIPAL COMMISSIONER OF INCOME TAX, CENTRAL Versus INCOME TAX SETTLEMENT COMMISSION ========================================================== Appearance: MR SANJAY JAIN, ADDITIONAL SOLICITOR GENERAL with MR PATHIK M ACHARYA, MR RAVI PRAKASH, MR AMAN MALIK and MR ADITYA AJAY (3520) for the Petitioner(s) No. 1 MR S GANESH, SENIOR ADVOCATE with MR B S SOPARKAR(6851) for the Respondent(s) No. 2, MR SN SOPARKAR, SENIOR ADVOCATE with MR B S SOPARKAR and MS JINAL SOLANKI for the Respondent(s) No. 3,4 MR DEVANG VYAS(2794) for the Respondent(s) No. 1 ========================================================== CORAM: HONOURABLE MS.JUSTICE HARSHA DEVANI and HONOURABLE MS. JUSTICE SANGEETA K. VISHEN Page 1 of 93 C/SCA/9883/2019 JUDGMENT Date : 22/10/2019 ORAL JUDGMENT (PER : HONOURABLE MS.JUSTICE HARSHA DEVANI) 1. By this petition under articles 226 and 227 of the Constitution of India, the petitioner, namely, the Principal Commissioner of Income Tax, Central, Surat has challenged the order dated 30.1.2019 passed by the Income Tax Settlement Commission (the respondent No.1 herein) under section 245D(4) of the Income tax Act, 1961 (hereinafter referred to as “the IT Act”) to the extent it deals with undisclosed foreign income and assets of the respondents No.2, 3 and 4 (hereinafter referred to as “the contesting respondents”). 2. The facts, as averred in the petition, are that the respondents No.2, 3 and 4 Shri Vimal Patel, Shri Samir Patel and Shri Mehul Patel respectively, are promoters in the Banco Group of Companies. One of the main companies of the group M/s. Banco Products (India) Limited is a public limited company involved in the business of manufacturing of gaskets, radiators, charged air coolers and oil coolers extensively used in the automobile industry. As per the details submitted by them before the Settlement Commission, the contesting respondents were born in Kenya and are persons of Indian origin and that at present, they are residents of UAE though they have residences in UK and Africa and all of them hold British passports. In April, 2016 in the Panama Papers expose, a company by the name of Overseas Pearl Limited, British Virgin Island, registered in the British Virgin Islands and Page 2 of 93 C/SCA/9883/2019 JUDGMENT domiciled in Jersey, belonging to the contesting respondents, was mentioned. It is the case of the petitioner that the main issue in this case was the existence of ownership by Indian Tax Residents (respondents No.2, 3 and 4) in the shareholding of the company (i) M/s. Overseas Pearl Limited registered in the British Virgin Islands (ii) in another company by the same name in Liberia, and (iii) beneficial ownership of a trust named “Marias Trust” registered in Jersey and that as per the information, the contesting respondents are beneficial owners of the company M/s. Overseas Pearl Limited registered in Liberia as well as the British Virgin Islands. 2.1 On 2.8.2016, a search and seizure operation came to be conducted by the Investigating Wing, Vadodara under section 132(1) of the IT Act at the residential premises and business premises of the Banco Group of Companies. The contesting respondents are the Directors in Banco Group of Companies. The main issue in this case was non-disclosure of foreign income and assets including foreign bank accounts in their returns by the contesting respondents for the period they were residents and were bound to disclose the same under section 139 of the IT Act and to include it in their total income. According to the petitioner, an appraisal report of the case was received by the Assessing Officer on 12.1.2017 and Foreign Tax and Tax Research Division (FT & TR) references were made by the Investigating Wing of the Income tax Department to several foreign jurisdictions to collect additional details regarding foreign assets/income of the contesting respondents. 2.2 Notification S.O. 1791(E) dated 1.7.2015 came to be issued by the Central Government under the Black Money Page 3 of 93 C/SCA/9883/2019 JUDGMENT (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (hereinafter referred to as “the Black Money Act”) in terms whereof, 30.9.2015 was specified as the date on or before which a person may make a declaration in respect of an undisclosed asset located outside India. However, the contesting respondents did not make any declaration of their undisclosed foreign income/assets in accordance with the provisions of the Black Money Act and the notification issued thereunder. 2.3 During post search proceedings under section 131(1A) of the IT Act, the respondent No.2, by a letter dated 18.10.2016, disclosed Rs.100 crores for all the three contesting respondents and other entities in which they are directly and indirectly interested which was confirmed by the respondents No.2 and 3. Such disclosure related to bank accounts in Citibank N.A., Singapore, bank accounts in Habib Bank AG Zurich, Dubai and investment portfolio accounts in various foreign banks, details of which were found during the search proceedings. The disclosure of Rs.100 crores was made by the contesting respondents as their undisclosed income over and above their regular income. 2.4 Thereafter, the matter was centralised with the Deputy Commissioner of Income-tax, Central Circle-3, Baroda and notices under section 153A of the IT Act were issued on 10.3.2017 in the group cases for assessment years 2011-12 to 2016-17. The limitation for passing the assessment order under section 153A of the IT Act was 31.12.2018. Notices under section 148 of the IT Act also came to be issued on 25.3.2017 to the contesting respondents for assessment years Page 4 of 93 C/SCA/9883/2019 JUDGMENT 2000-2001 to 2007-2008, on the basis of the information of undisclosed foreign assets and income, foreign bank accounts. 2.5 On 31.7.2017, the contesting respondents filed settlement applications under section 245C(1) of the IT Act before the Settlement Commission, Mumbai, for assessment years 2005-06 to 2013-14, assessment years 2004-05 to 2015- 16 and assessments years 2004-05 to 2015-16, respectively. Before the Settlement Commission, the contesting respondents collectively offered aggregate additional income of Rs.129,09,82,999/- (which included Rs.125.35 crores on account of undisclosed foreign income and assets) in pursuance of the search under section 132 of the IT Act. Out of such amount, the contesting respondents offered total additional income of Rs.38,81,57,999/- in their return of income filed under section 153A as well as section 148 of the IT Act before the Assessing Officer during the pendency of the assessment proceedings, and Rs.90,28,25,000/- in their applications filed before the Settlement Commission. 2.6 Vide order dated 14.8.2017 made under section 245D(1) of the IT Act, the applications made by the contesting respondents were admitted by the Settlement Commission and allowed to be proceeded with. Thereafter, vide order dated 28.9.2017 under section 245D(2C) of the IT Act, the Settlement Commission held that the applications made by the contesting respondents not to be “invalid”. Consequently, a report under rule 9 of the Income Tax Settlement Commission Procedure Rules, 1997 came to be submitted on 16.11.2017. Thereafter, several reports were furnished by the petitioner and the contesting respondents filed their responses thereto. Page 5 of 93 C/SCA/9883/2019 JUDGMENT 2.7 On 2.8.2018, notices under sub-section (1) of section 10 of the Black Money Act were issued to the contesting respondents for assessment years 2017-18 and 2018-19. In response thereto the contesting respondents filed their replies. During the pendency of the proceedings, vide letter dated 23.10.2018, the petitioner informed the Settlement Commission of the fact that the proceedings under the Black Money Act in these cases were pending. 2.8 By a letter dated 6.12.2018, the Settlement Commission called for a verification report from the Department inter alia calling for information as to whether the Department wanted to continue the proceedings under the Black Money Act or the proceedings which were pending with the Settlement Commission in respect of the same income and the same assessees. By a letter dated 10.12.2018, the petitioner informed the Settlement Commission that as per the legal opinion of the senior standing counsel of the Income Tax Department the proceedings under section 10 of the Black Money Act can be initiated against the assessee; however, the income which is determined by the Settlement Commission is to be reduced from the income assessed under section 10 of the Black Money Act. The relevant part of the opinion was extracted in the said letter which reads as under: “Whether notice u/s 10 of the Act can be issued for those assessment years for which settlement proceedings are pending before the Settlement Commission? The proceedings before the Settlement Commission are under the provisions of the Income Tax Act. Thus, though notice under Section 10 can be issued for Assessment Years for which settlement proceedings are pending Page 6 of 93 C/SCA/9883/2019 JUDGMENT before the Settlement Commission, ultimately benefit will be required to be granted while computation under Section 5 of the Act.” It was accordingly stated that it would be more appropriate to continue with the assessment of the income under the provisions of section 147 of the IT Act for which the assessees have already admitted the income and that if there is an income which is not assessed under the said section, then the difference would be brought to tax under the Black Money Act as per the relevant provisions thereof and the legal opinion of the Senior Standing Counsel of the Department. 2.9 Thereafter, the Settlement Commission proceeded further with the applications under section 245C of the IT Act and by the impugned order dated 30.1.2019 made under sub- section (4) of section 245D thereof, computed the total income of the contesting respondents for the concerned assessment years and directed them to pay taxes including interest payable as per the order in four quarterly installments beginning March 2019 and ending in December, 2019 and further held that interest under section 245D(6A) will be chargeable as per the IT Act. The Settlement Commission granted further reliefs in terms of the impugned order. Being aggrieved, the petitioner has filed the present petition. 3. Mr. Sanjay Jain, learned Additional Solicitor General emphatically argued that the impugned order passed by the Settlement Commission is without jurisdiction, inasmuch as, the Settlement Commission had no jurisdiction to pass an order under the Income Tax Act in relation to undisclosed foreign income and assets which are covered under the Black Page 7 of 93 C/SCA/9883/2019 JUDGMENT Money Act. It was submitted that the Settlement Commission failed to appreciate that the Black Money Act has been enacted to make provisions to deal with the problem of black money, that is, undisclosed foreign income and assets, the procedure for dealing with such income and assets and to provide for imposition of tax on any undisclosed foreign income and assets held outside India. In this regard, the attention of the court was invited to the preamble of the Black Money Act. 3.1 It was submitted that the Black Money Act is a special and later Act dealing with undisclosed foreign income and assets, while the Income Tax Act is a general law to consolidate and amend the law relating to income tax and as such the Black Money Act being a special legislation would prevail over the Income Tax Act for the purpose of assessment of undisclosed foreign income and assets after the coming into operation of the Black Money Act. 3.2 The attention of the court was invited to the provisions of section 4 of the Black Money Act which provide for the ‘Scope of total undisclosed foreign income and asset’ and more particularly to sub-section (3) thereof which provides that the income included in the total undisclosed foreign income and asset under that Act shall not form part of the total income under the Income Tax Act. It was submitted that in view of the provisions of sub-section (3) of section 4 of the Black Money Act, it is clear that any undisclosed foreign income and asset which is assessable under the Black Money Act does not form part of income under the Income Tax Act and as such, the Income Tax Act is not applicable to those undisclosed foreign Page 8 of 93 C/SCA/9883/2019 JUDGMENT income and asset. It was submitted that the legislature clearly wanted to exclude foreign income from the purview of the Income Tax Act. It was contended that therefore, the Settlement Commission had no jurisdiction to entertain and decide the applications made by the contesting respondents under section 245C of the IT Act. 3.3 Reference was made to sections 10, 59 and 72 of the Black Money Act, to submit that these sections form a complete regime for assessment under the Black Money Act. It was contended that insofar as domestic income and assets are concerned, it is the income tax authorities who have the jurisdiction; however, in case of undisclosed foreign income or assets, it is the authorities appointed under the Black Money Act who have the jurisdiction. 3.4 The learned Additional Solicitor General next submitted that the contesting respondents neither disclosed their foreign income/assets in their income tax returns nor did they make any declaration of the same in terms of section 59 of the Black Money Act. Referring to the provisions of section 59 of the Black Money Act, it was submitted that the same provides that any person may make, on or after the date of commencement of the Black Money Act but on or after the date to be notified by the Central Government in the Official Gazette, a declaration in respect of any undisclosed asset located outside India and acquired from income chargeable to tax under the Income-tax Act for any assessment year prior to the assessment year beginning on 1st day of April, 2016 for which he has failed to furnish a return under section 139 of the Income-tax Act, which he has failed to disclose in a return of Page 9 of 93 C/SCA/9883/2019 JUDGMENT income furnished by him under the Income-tax Act before the date of commencement of that Act, or which has escaped assessment by reason of the omission or failure on the part of such person to make a return under the Income-tax Act or to disclose fully and truly all material facts necessary for the assessment or otherwise. It was submitted that, therefore, section 59 of the Black Money Act provides that any person may make a declaration in respect of undisclosed foreign income and asset. Thus, every person whether resident or not ordinarily resident in India was provided with an opportunity to make a declaration of undisclosed foreign income and asset. It was pointed out that vide notification S.O. 1791(E) dated 1.7.2015 issued by the Central Government under section 59 of the Black Money Act, 30.9.2015 was notified as the date on or before which a person may make a declaration in respect of an undisclosed asset located outside India and 31.12.2015 was notified as the date on or before which a person shall pay the tax and penalty in respect of the undisclosed asset located outside India so declared under section 59 of the Black Money Act. 3.5 Reference was made to section 72(c) of the Black Money Act which provides that where any asset has been acquired or made prior to commencement of the Black Money Act, and no declaration in respect of such asset is made under that Chapter (that is, Chapter VI), such asset shall be deemed to have been acquired or made in the year in which a notice under section 10 is issued by the Assessing Officer and the provisions of the Black Money Act shall apply accordingly. It was submitted that the applicability of these provisions in the case of the contesting respondents is further strengthened by Page 10 of 93 C/SCA/9883/2019 JUDGMENT the circular of the Department bearing Circular No.13 of 2015 dated 6.7.2015 in answer to FAQ No.23 and Circular No.15 of 2015 dated 3.9.2015 and in answer to FAQ No.26, which read as under: “Question No.23: A person is a non-resident. However, he was a resident of India earlier and had acquired foreign assets out of income chargeable to tax in India which was not declared in the return of income or no return was filed in respect of that income. Can that person file a declaration under Chapter VI of the Act? Answer: Section 59 provides that a declaration may be made by any person of an undisclosed foreign asset acquired from income chargeable to tax under the Income-tax Act for any assessment year prior to assessment year 2016-17. Since the person was a resident in the year in which he had acquired foreign assets (which were undisclosed) out of income chargeable to tax in India, he is eligible to file a declaration under section 59 in respect of those assets under Chapter VI of the Act.” “Question 26: As per answer to question no.23 of Circular No.13 dated 06.07.2015, a person being a non-resident can file a declaration under Chapter VI of the Act in respect of asset acquired out of income chargeable to tax earned when he was resident in India in the past. However, para 3 of the Explanatory Circular No.12 dated 02.07.2015 states that a declaration may be filed by a person, being a resident in India. Are these positions contradictory? Answer: Para 3 of the Explanatory Circular No.12 dated 02.07.2015 provides that a resident may file a declaration under Chapter VI of the Act. It does not say that a non-resident who was earlier resident in India cannot file a declaration in respect of asset acquired out of income chargeable to tax in India earned when he was a resident. Answer to question no.23 of Circular No.13 dated 06.07.2015 says that a person may make a declaration under section 59 of the Act in respect of an undisclosed foreign asset acquired by him in the year in which he was resident in India. Thus, a specific situation Page 11 of 93 C/SCA/9883/2019 JUDGMENT has been dealt in answer to question no.23 of Circular No.13 dated 06.07.2015 which answers the query clearly.” 3.6 It was submitted that in view of the provisions of section 59 of the Black Money Act, if in any past year the contesting respondents were required to make a declaration in respect of any undisclosed asset located outside India, which they had failed to disclose earlier under the Income Tax Act, they are assessees in default. It was pointed out that section 72(c) of the Black Money Act provides that where an asset has been acquired or made prior to the commencement of that Act, and no declaration in respect of such asset has been made under that Chapter, such asset shall be deemed to have been acquired in the year in which a notice under section 10 is issued by the Assessing Officer and the provisions of the Black Money Act would apply accordingly. It was submitted that section 72(c) relates to assets which are acquired even prior to the assessment year commencing on or after the 1st day of April, 2016. It was submitted that by not making a declaration as required under section 59 of the Black Money Act within the window provided for making such declaration, the contesting respondents would be deemed to be assessees in default and the undisclosed asset will be deemed to have been acquired in the year in which the Assessing Officer issued notices to them under section 10 of the Black Money Act. 3.7 It was submitted that therefore, even in terms of sub- section (2) of section 2 of the Black Money Act prior to its amendment vide Finance No.2 Act of 2019, the contesting respondents would fall within the ambit of the expression assessee as defined therein. Reference was made to the Page 12 of 93 C/SCA/9883/2019 JUDGMENT definition of “assessee” under sub-section (2) of section 2 of the Black Money Act which defines assessee to mean a person, being a resident other than not ordinarily resident in India within the meaning of clause (6) of section 6 of the Income Tax Act, by whom tax in respect of undisclosed foreign income and assets, or any other sum of money, is payable under that Act and includes every person who is deemed to be an assessee in default under the Black Money Act. It was submitted that a person who is deemed to be an assessee in default is covered by the expression “assessee” and, therefore, for the reason that they have not made any declaration of their foreign income and assets in terms of the Black Money Act, even in terms of the unamended section 2(2), the contesting respondents are assessees in default in terms of section 2(2) read with section 59 and section 72(c) of the Black Money Act and as such, the provisions of the Black Money Act are applicable to them for the period under consideration. Reliance was placed upon an unreported decision of the Supreme Court in the case of Union of India v. Gautam Khaitan rendered on 15.10.2019 in Criminal Appeal No.1593 of 2013. wherein it has been held that where no declaration in respect of the asset covered under the Black Money Act is made, such asset would be deemed to have been acquired or made in the year in which a notice under section 10 is issued by the Assessing Officer and the provisions of the Act shall apply accordingly. It was submitted that thus, non-declaration of assets under section 59 of the Black Money Act constitutes a default and the contesting respondents would be deemed to be assessees in default, even though the words “assessee in default” is not used in sections 59 and 72(c) of the Black Money Act. According to the learned counsel, the Settlement Commission Page 13 of 93 C/SCA/9883/2019 JUDGMENT should have conducted itself in accordance with law and should have left the undisclosed foreign income to proceedings under the Black Money Act. It was submitted that when this new enactment has paved window for separate set of officers to apply mind, and when it has been brought to its notice that proceedings under the Black Money Act have been initiated, the Settlement Commission should have confined its order to the undisclosed domestic income. 3.8 It was submitted that in view of the provisions of sub- section (3) of section 4 of the Black Money Act, undisclosed foreign income will not form part of the total income under the Income Tax Act. It was contended that the legislature wanted to exclude undisclosed foreign income from the purview of the Income Tax Act. According to the learned counsel, section 4 of the Black Money Act is the governing section, whereas section 5 thereof only deals with computation and speaks of assessments concluded under the Income Tax Act. It was argued that therefore, in view of the provisions of sections 4, 5 and 59 of the Black Money Act, the Black Money Act and the IT Act remain mutually exclusive and there is no overlapping. It was also submitted that though sub-section (3) of section 4 of the Black Money Act does not contain a non obstante clause, having regard to the object of the Act, the court may read a non obstante clause in it. Referring to the statement of objects and reasons as well as the preamble of the Black Money Act, it was submitted that having regard to object behind the enactment, this court in judicial review may consider non providing of an overriding provision to be an omission on the part of the legislature and read such a provision therein. Page 14 of 93 C/SCA/9883/2019 JUDGMENT 3.9 It was further submitted that notices under sub-section (1) of section 10 of the Black Money Act were issued to the contesting respondents on 2.8.2018 for assessment years 2017-18 and 2018-19 during the pendency of proceedings before the Settlement Commission. It was submitted that the initial information relating to undisclosed foreign income/assets of the contesting respondents came to the notice of the Assessing Officer on 12.1.2017 (the date on which appraisal report was received by the Assessing Officer), relevant to assessment year 2017-18 and in case of disclosure before the Settlement Commission on 22.8.2017, which is the date when the applications and copies of statement of facts of the contesting respondents was received by the Assessing Officer. 3.10 It was further submitted that the proviso to sub- section (1) of section 3 of the Black Money Act provides that an undisclosed asset located outside India shall be charged to tax on its value in the previous year in which such asset comes to the notice of the Assessing Officer and, therefore, in the present case the contesting respondents are liable to be dealt with under the Black Money Act. It was submitted that the Black Money Act was in operation at the time when the settlement application dated 31.7.2017 was filed before the Settlement Commission making a disclosure of undisclosed foreign income and asset and, therefore, the Settlement Commission could not have proceeded with the settlement proceedings under the IT Act to the extent they related to undisclosed foreign income and assets. It was argued that the contesting respondents never disclosed any foreign income or asset in their returns of income though they were tax residents in India till assessment year 2013-14 in the case of Shri Vimal Page 15 of 93 C/SCA/9883/2019 JUDGMENT Patel, and till assessment year 2015-16 in the case of Shri Mehul K. Patel and Shri Samir Patel. 3.11 Referring to the provisions of section 3 of the Black Money Act, it was submitted that this is the charging section and the base of the charge is on every assessee in respect of assessment years commencing or after the 1st day of April, 2016. It was submitted that the proviso to sub-section (1) of section 3 of the Black Money Act prescribes that even the undisclosed assets located outside India pertaining to a period prior to commencement of this Act shall be charged to tax on its value in the previous year when it comes to the notice of Assessing Officer. 3.12 Reference was made to the provisions of sub- section (1) of section 10 of the Black Money Act, to submit that in view thereof, the Assessing Officer may, on receipt of an information from an income-tax authority under the Income- tax Act or any other authority under any law for the time being in force or on coming of any information to his notice, serve on any person, a notice requiring him on a date to be specified, to produce or cause to be produced such accounts or documents or evidence as the Assessing Officer may require for the purposes of that Act and may, from time to time, serve further notices requiring the production of such other accounts or documents or evidence as he may require. It was submitted that, accordingly, notices for assessment year 2017-18 and for assessment year 2018-19 were issued under section 10 of Black Money Act in accordance with the provisions of section 10, that is, the year when the information pertaining to undisclosed foreign income and assets came to the notice of Page 16 of 93 C/SCA/9883/2019 JUDGMENT the Assessing Officer. 3.13 Reference was made to sub-section (12) of section 2 of the Black Money Act which defines “Undisclosed foreign income and asset” to submit that the definition nowhere mentions the years to which the undisclosed foreign income and asset pertains. It was submitted that sub-section (12) of section 2 read with sub-section (1) of section 10 shows that unlike the Income Tax Act, the Black Money Act does not limit the years for which proceedings under that Act could be initiated and that what is assessable under Black Money Act is undisclosed foreign asset when it comes to the notice of the Assessing Officer, and the value of such assets would be charged to tax as per the proviso to section 3 of the Black Money Act. 3.14 Next, it was submitted that the definition of ‘assessee’ under sub-section (2) of section 2 of Black Money Act has been amended by the Finance Bill No.2 2019, to bring within its ambit non-residents. It was pointed out that sub- section (2) of section 2 has been amended with retrospective effect from 1st July, 2017, to submit that the contesting respondents would, therefore, fall within the ambit of “assessee” with effect from 1st July, 2015. It was submitted that since the contesting respondents clearly fall within the ambit of the definition of “assessee’ as defined under sub- section (2) of section 2 of the Black Money Act, the undisclosed foreign income and asset of the contesting respondents are governed by the provisions of the Black Money Act and the Settlement Commission had no jurisdiction to pass any order Page 17 of 93 C/SCA/9883/2019 JUDGMENT under section 245D (4) of the IT Act in respect of such income and asset. 3.15 It was further submitted that Black Money Act is a special Act dealing with the undisclosed foreign income and assets while the Income Tax Act is a general law to consolidate and amend the law relating to Income Tax and as such the Black Money Act being a special legislation prevails over the Income Tax Act for the purposes of assessment of undisclosed foreign income and assets after coming into operation of the Black Money Act. In support of such submission, reliance was placed upon the decision of the Supreme Court in Commercial Tax Officer, Rajasthan v. Binani Cements Limited and Another, (2014) 8 SCC 319, wherein it has been held thus:- “34. It is well established that when a general law and a special law dealing with some aspect dealt with by the general law are in question, the rule adopted and applied is one of harmonious construction whereby the general law, to the extent dealt with by the special law, is impliedly repealed. This principle finds its origins in the Latin maxim of generalia specialibus non derogant i.e. general law yields to special law should they operate in the same field on same subject (Vepa P. Sarathi, Interpretation of Statutes, 5th Edn., Eastern Book Company; N.S. Bindra’s Interpretation of Statutes, 8th Edn., The Law Book Company; Craies on Statute Law, S.G.G. Edkar, 7th Edn., Sweet & Maxwell; Justice G.P. Singh, Principles of Statutory Interpretation, 13th Edn., Lexis Nexis; Craies on Legislation, Daniel Greenberg, 9th Edn., Thomson Sweet & Maxwell, Maxwell on Interpretation of Statutes, 12th Edn., Lexis Nexis).” 3.16 It was submitted that the contesting respondents had claimed that what they have disclosed before the Page 18 of 93 C/SCA/9883/2019 JUDGMENT Settlement Commission is income for assessment years 2005- 06 to 2013-14 for Shri Vimal Patel and for assessment years 2004-05 to 2015-16 in case of Samir Patel and Mehul Patel, and not assets. It was pointed out that under the Black Money Act, undisclosed foreign income can be taxed only for assessment year 2016-17 for which the relevant previous year is 2015-16. This is so because section 3 of the Black Money Act clearly mentions the same. However, due to the effect of proviso to section 3, the undisclosed foreign asset can be taxed for any previous year and shall be charged to tax on its value in the previous year in which such asset comes to the notice of the Assessing Officer. It was submitted that in this regard, it is necessary to understand the subject matter of the income offered by the contesting respondents. It was pointed out that the contesting respondents have offered their global income, that is, income earned and accrued outside India along with income arising in India for assessment years when the contesting respondents were resident in India. Therefore, the income earned during those years was chargeable to tax In India. Referring to the items of income offered to tax as mentioned in the applications made by the contesting respondents under section 245C of the IT Act, it was pointed out that the same include the following:- “a. Items of Income credited to various foreign bank accounts of the Applicant in the form of income from Investments in shares, debentures, bonds, time deposits and units of mutual funds / investment instruments (Securities): 1. Dividends received on Securities 2. Income distribution on the Units 3. Interest on bonds, debentures and time deposits 4. Gains on purchase and sale of Page 19 of 93 C/SCA/9883/2019 JUDGMENT Securities b. Distribution of Income from Discretionary Trust set up outside India where the Applicant is one of the beneficiaries c. Credits in the foreign bank accounts of the Applicant jointly with other brothers primarily representing the income earned by the group entities. The source and manner of earning said income is explained hereafter. d. Income in the form of rental and gains from immovable property in which investment was made out of the funds in these accounts. e. Income attributable to assets transferred to Frangipani Trust by the applicant and included as income of the applicant. f. Income on account of unexplained investment in purchase of land. g. Miscellaneous credits in the bank accounts maintained outside India for which information about source is not available due to lapse of time.” 3.17 It was submitted that on a perusal of the above, it could be seen that out of income accrued/arisen to the contesting respondents in the years in which they were resident in India, they have acquired assets like shares, bonds, debentures, mutual funds, other investments, bank account balances are which all assets of the contesting respondents. According to the learned counsel for the petitioner, the income arising at a particular time and credited in the account of a person is income but the bank account as such and the balance in that account at any point of time, constitutes the asset of the person. It was submitted that section 59 of the Black Money Act also refers to undisclosed asset located outside India and acquired from income chargeable to tax under the Income-tax Act for any assessment year prior to assessment year 2016-17. In this case, the contesting Page 20 of 93 C/SCA/9883/2019 JUDGMENT respondents had acquired shares/debentures/bonds/ mutual funds, etc. as admitted by them before the Settlement Commission in the years in which they were residents. Therefore, the claim made by the contesting respondents that they have offered only income before the Settlement Commission and not any asset does not hold good because what is taxable under Income-tax Act, 1961 is the income. 3.18 It was submitted that section 5 of the Income Tax Act defines ‘Scope of total Income’ and specifies that ‘total income’ of any person who is resident in any previous year includes all income from whatever source received/deemed to have been received in India, accrues or arises/deemed to accrues or arise in India or accrues or arises to him outside India during such year. It was submitted that the scheme of the Income Tax Act is required to be understood with reference to section 69A thereof, which by deeming fiction taxes assets as income. It was submitted that section 69B of the Income tax Act also provides such deeming fiction and treats the amount of investment not fully disclosed in books of accounts as income and, therefore, even the assets which were not part of the books of account and offered to tax can be charged only as income under the Income Tax Act. 3.19 Next, it was submitted that while it is true that before the Settlement Commission, the petitioner had stated that they desire to proceed further in the proceedings before the Settlement Commission, the principle of estoppel does not apply against a statute and consent cannot confer jurisdiction upon an authority which does not have such jurisdiction. It was Page 21 of 93 C/SCA/9883/2019 JUDGMENT submitted that despite there being no objection raised by the Department for continuance of the proceedings before the Settlement Commission in ignorance of the mandate of the Black Money Act, it was the duty of the Settlement Commission not to proceed with the settlement proceedings to the extent they related to undisclosed foreign income and assets. Reliance was placed upon the decision of the Supreme Court in the case of Maharshi Dayanand University vs. Surjeet Kaur, (2010) 11 SCC 159, for the proposition that there can be no estoppel/promissory estoppel against the legislature in the exercise of the legislative function nor can the Government or public authority be debarred from enforcing a statutory prohibition. Promissory estoppel being an equitable doctrine, must yield when the equity so requires. 3.20 Reliance was also placed upon the decision of the Supreme Court in the case of Collector v. Cine Exhibitors (P) Ltd., (2012) 4 SCC 441, for the proposition that it is settled in law that the doctrine of promissory estoppel is founded on the principles of equity and to avoid injustice. The said principle cannot be soundly embedded or treated to be sacrosanct when a public authority carries out a representation or a promise which is prohibited by law or is devoid of the authority of law. 3.21 It was further submitted that it is well settled law that consent cannot confer jurisdiction upon an authority which does not have such jurisdiction. In support of such submission, reliance was placed upon the decision of the Supreme Court in the case of Jagmittar Sain Bhagat v. Health Services, Page 22 of 93 C/SCA/9883/2019 JUDGMENT Haryana, (2013) 10 SCC 136, wherein it has been held that it is a settled legal proposition that conferment of jurisdiction is a legislative function and it can neither be conferred with the consent of the parties nor by a superior court, and if the court passes a decree having no jurisdiction over the matter, it would amount to nullity as the matter goes to the root of the cause. Such an issue can be raised at any stage of the proceedings. The finding of a court or tribunal becomes irrelevant and unenforceable/inexecutable once the forum is found to have no jurisdiction. Similarly, if a court/tribunal inherently lacks jurisdiction, acquiescence of party equally should not be permitted to perpetrate and perpetuate defeating the legislative animation. The court cannot derive jurisdiction apart from the statute. In such eventuality the doctrine of waiver also does not apply. 3.22 It was, accordingly, urged that merely because before the Settlement Commission, the Department had consented to proceed further with the settlement proceedings, it would not vest in the Settlement Commission the jurisdiction to entertain and decide the application under section 245C of the Income tax Act in respect of the undisclosed foreign income and asset. 3.23 The learned Additional Solicitor General further submitted that apart from the fact that the impugned order passed by the Settlement Commission is unsustainable on the ground of lack of jurisdiction, another aspect which goes to the root of the matter is that the contesting respondents had not made full and true disclosure of their foreign income and Page 23 of 93 C/SCA/9883/2019 JUDGMENT assets in the applications made under section 245C of the Black Money Act. It was submitted that it is well settled that in the scheme of Chapter XIX-A of the Income Tax Act, there is no stipulation for revision of an application under section 245C (1) and the natural corollary is that determination of income by the Settlement Commission has necessarily to be with reference to the income disclosed in the application filed under said section in the prescribed form. It was submitted that it is also well settled that the Settlement Commission is not meant to be an optional forum chosen at the option of the assessee for the settlement of the tax liability of the assessee as also his liability for further proceedings or prosecution under the Income Tax Act or other Acts, even while the assessee continues to be dishonest and deliberately fails to make a true and full disclosure of the extent of the income which he has not disclosed before the Assessing Officer. It was submitted that in this case the contesting respondents have offered additional income over and above the additional income offered by them in their settlement applications after certain infirmities in the disclosure being pointed out by the petitioner. It was pointed out that the contesting respondents had revised additional income under the following heads:- “A. Opening balance of 7.5% HSBC Bank Plc Bond of US$10,86,457/-. Because of the errors in reconciliation raised before Respondent No.1 by the Petitioner, Respondent No. 2, 3 and 4 offered the entire investment of US $ 10,86,000/- as additional income in AY 2008-09 in respect of the investment reflected in FY 2007-08. The total additional income offered by the Respondent No. 2, 3 and 4 was Rs. 4,34,25,670/- in hands of the Respondent No.2, 3 and 4. Page 24 of 93 C/SCA/9883/2019 JUDGMENT B. Opening balance of HSBC account, Hong Kong of HKD 9,20,400 as on 10.10.2005 has been offered as additional income in the hands of Respondents No.2, 3 and 4 for AY 2006-07:- The Respondents No. 2, 3 and 4 made a total disclosure of Rs.52,83,096/- in AY 2006-07 (Rs.17,61,032/- in each hand) since opening balance could not be explained by them. C. Barclays Bank account balance of GBP 2,46,263 in case of Shri Vimal Patel:- With regard to the Barclays Bank account, initially the Respondent No. 2 had offered bank interest of Rs. 6522/- only for AY 2005-06. The Petitioner in its report dated 23.10.2018, had stated that the Respondent No. 2 has neither submitted the basis of opening balance of the aforesaid account aggregating to GBP 2,46,263/- nor submitted bank statements prior to this period. Respondent No. 2 therefore offered the entire opening balance of Rs. 1,92,21,581 (in INR) as income for AYs 2005-06 (Rs.11,92,688/-) and 2006-07 (Rs.1,80,28,893/-). D. Interest income of Eur 26,550 as per applicant’s letter dated 08.10.2018 determined on account of reconciliation of Code 39 and 40:- During the process of verification, it was observed that the Respondents No. 2, 3 and 4 had mentioned ledger code-39 and code-40 in bank statements to which various amounts were transferred. However, on reconciliation, it was found that amount of Euro 26,550 (Rs.15,02,199/-) could not be reconciled. Therefore, Respondents No. 2, 3 and 4 offered Rs.15,02,199/- as interest income in AY 2005-06. E. Income offered to cover up insufficient personal household expenses for the period covered by the Settlement application filed by the Respondents No. 2, 3 Page 25 of 93 C/SCA/9883/2019 JUDGMENT and 4:- Initially, Respondents No. 2, 3 and 4 offered income of Rs. 28,25,000/- on account of household and other domestic expenses. Later on, Respondents No. 2, 3 and 4 offered Rs. 1.49 crore as additional income. F. Income from Marias Trust:- Respondents No. 2, 3 and 4 initially disclosed an additional income of Rs.3,60,79,859/- each, for taxation for the AY 2007-08 as distribution of income from Marias Trust being 1/3rd share of the Respondent No. 2, 3 and 4. The Petitioner contended that there is no basis for such disclosure being made by the Respondents No. 2, 3 and 4. Further, it was contended that since Marias Trust is an Association of Person (“AOP”), and control and management of the Trust was actually exercised by the three beneficiary Respondent No. 2, 3 and 4, the AOP should be regarded as resident in India and thus the whole of the income of the trust shall be taxed in India in the hands of Respondent No. 2, 3 and 4. The Petitioner further raised the issue that, notwithstanding the above, the Respondents No. 2, 3 and 4 must furnish the Balance sheets, Profit & loss accounts and the manner of deriving the income in the case of Marias Trust but they did not provide the same. Respondents No. 2, 3 and 4 reflected the income for the AY 2007-08 out of distribution of profit from the Marias Trust, but they failed to provide details required to justify as to why aforesaid income was offered for only one assessment year. Subsequent to that during the finalization of proceedings before Respondent No.1, the Respondents No. 2, 3 and 4 offered additional income of Rs. 21,53,333/- in their hands being share in the income accrued to the Marias Trust on a financial year basis for the period for which petition was filed.” It was submitted that the disclosure of income made by the Page 26 of 93 C/SCA/9883/2019 JUDGMENT contesting respondents was, therefore, not full and true which is pre-condition for a valid application under section 245C(1) of the IT Act. 3.24 Reliance was placed upon the decision of the Supreme Court in the case of Ajmera Housing Corporation and another v. Commissioner of Income Tax, (2010) 8 SCC 739, wherein the court has held thus:- “27. It is clear that disclosure of \"full and true\" particulars of undisclosed income and \"the manner\" in which such income had been derived are the pre-requisites for a valid application under Section 245C(1) of the Act. Additionally, the amount of income tax payable on such undisclosed income is to be computed and mentioned in the application. It needs little emphasis that Section 245C(1) of the Act mandates \"full and true\" disclosure of the particulars of undisclosed income and \"the manner\" in which such income was derived and, therefore, unless the Settlement Commission records its satisfaction on this aspect, it will not have the jurisdiction to pass any order on the matter covered by the application.” “35.… A \"full and true\" disclosure of income, which had not been previously disclosed by the assessee, being a pre-condition for a valid application under Section 245C (1) of the Act, the scheme of Chapter XIX-A does not contemplate revision of the income so disclosed in the application… Moreover, if an assessee is permitted to revise his disclosure, in essence, he would be making a fresh application in relation to the case by withdrawing the earlier application. In this regard, Section 245-C (3) of the Act which prohibits the withdrawal of an application once made under sub-section (1) is instructive inasmuch as it manifests that an assessee cannot be permitted to resile from his stand at any stage during the proceedings. Therefore, by revising the application, the applicant would be achieving something indirectly which he cannot otherwise achieve directly and in the process rendering the provision of sub-section (3) of Section 245-C of the Act otiose and meaningless. ... Page 27 of 93 C/SCA/9883/2019 JUDGMENT 36. It is trite law that a taxing statute is to be construed strictly. In a taxing Act one has to look merely at what is said in the relevant provision. There is no presumption as to a tax. Nothing is to be read in, nothing is to be implied. There is no room for any intendment. There is no equity about a tax. (See: Cape Brandy Syndicate v. Inland Revenue Commissioners (1921) 1 KB 64 and Federation of A.P. Chambers of Commerce and Industry and Others v. State of A.P. and Others, (2000) 6 SCC 550.) In interpreting a taxing statute, the Court must look squarely at the words of the statute and interpret them. Considerations of hardship, injustice and equity are entirely out of place in interpreting a taxing statute.” 3.25 Reliance was also placed upon the decision of the Delhi High Court in the case of Principal Commissioner of Income Tax-9 vs. Om Prakash Jakhotia & Anr, 2019 SCC OnLine Del 8063, wherein it has been held thus: “24. In the present case, after noting and brushing aside the Revenue's objections with regard to the complete lack of explanation by the assessee with respect to credits claimed, the ITSC proceeded to compute the amounts offered and observed that the difference in the net asset and the income declared was Rs. 5.55 crores. Jakhotia accepted the difference as their undisclosed income computed in the manner given (in the order) and “in the spirit of settlement agreed to offer additional income of Rs. 5.55 crores. A letter was filed on 10.11.2014 offering additional income of Rs. 5.55 crores, which is placed on record.” The ITSC thereafter recorded: ‘9. As discussed in the foregoing paras, we have considered the submissions of the applicant and the Department. All the issues were discussed one by one during the course of hearing. After carefully considering the submissions of the department and the applicant and the facts of the case, we are of the view that the offer made by the applicant in the SOF and the additional offer of Rs. 5.55 crores made during the course of proceedings u/s 2450(4) before this commission adequately cover all the issues. Therefore, the offer of additional income of Rs. 5.55 crores is accepted.’ Page 28 of 93 C/SCA/9883/2019 JUDGMENT 25. Clearly, the decision of the ITSC was untenable in law. Once the assessee approached it with a certain amount, representing that it constituted full and true disclosure (and had maintained that to be the correct amount till the date of hearing) the question of “offering” another higher amount as a “full” disclosure is impermissible. Ajmera Housing (supra) clearly held that: “there is no stipulation for revision of an application filed under 245C(1) of the Act and thus the natural corollary is that determination of income by the Settlement Commission has necessarily to be with reference to the income disclosed in the application filed under the said Section in the prescribed form. 26. The amount offered in this case, clearly could not have been considered or accepted. The ITSC, in this regard, fell into error as there was no full and true disclosure by the assessees. Consequently, the impugned order is hereby set aside and quashed. The AO shall proceed hereafter, in accordance with law and complete the block assessments. The time taken during the pendency of proceedings before the commission and the time during which the commission's order was in force, shall be ignored for the purpose of limitation.” 3.26 It was contended that sections 245C and 245D of the IT Act nowhere mention offer of additional income to buy peace. It was submitted that, therefore, the Settlement Commission was not justified in passing an order under section 245D of the IT Act, despite the fact that the contesting respondents had offered additional income during the course of the proceedings before it. It was accordingly, urged that the impugned order passed by the Settlement Commission suffers from lack of jurisdiction as well as the infirmities pointed out hereinabove rendering it unsustainable. 3.27 In conclusion, the learned Additional Solicitor General submitted that the Black Money Act is a special Act Page 29 of 93 C/SCA/9883/2019 JUDGMENT which prohibits the income tax authorities from adjudicating on issues relating to undisclosed foreign income and asset and, therefore, irrespective of the fact that the petitioner had agreed to proceed with the settlement proceedings, the Settlement Commission ought to have kept its hands off and should not have decided the matter to the extent of foreign income and asset and that merely because the revenue authorities persuaded the Settlement Commission to proceed further, it could not have proceeded further to decide on the question of foreign income and foreign asset. It was urged that, therefore, the impugned order passed by the Settlement Commission deserves to be quashed and set aside. 4. Opposing the petition, Mr. S. Ganesh and Mr. S.N. Soparkar, Senior Advocates, learned counsel with Mr. Bandish Soparkar, learned advocate for the respondent No.2 and respondents No.3 and 4 respectively, raised a preliminary contention to the very maintainability of this petition under articles 226 and 227 of the Constitution of India. In this regard the attention of the court was drawn to the fact that the order of the Settlement Commission covers assessment years 2004- 05 to 2015-16 and that the impugned order has been passed on 30.1.2019. It was submitted that under the order of the Settlement Commission a sizeable amount of the differential tax and interest was payable and that the Settlement Commission granted one year’s time to the contesting respondents to make such payment, however, in less than three weeks, the Department passed formal consequential orders on 18.2.2019 to recover the amount and demand notices were issued pursuant thereto and the contesting Page 30 of 93 C/SCA/9883/2019 JUDGMENT respondents were required to make payment under threat of coercion. It was submitted that, accordingly, by March 2019, the full amount in terms of the order passed by the Settlement Commission came to be paid and hence, the impugned order has been fully implemented. 4.1 Reference was made to the provisions of section 245-I of the IT Act which provides for ‘Order of settlement to be conclusive’, which postulates that no matter covered by the order of the Settlement Commission made under section 245D (4) of the Act will be reopened in any proceeding under the Act or any other law for the time being in force. It was submitted that section 245-I of the IT Act, not only clearly and unequivocally provides that the order of the Settlement Commission shall be final and conclusive but it also provides that no matter covered by such order shall be reopened in any proceeding under that Act or any other law for the time being in force. It was submitted that this is nothing but a non- obstante clause by virtue of which the conclusiveness and finality of the order of the Settlement Commission which would prevail even over the proceedings of the Black Money Act. It was submitted that in sharp contrast, there is no non-obstante clause whatsoever in the provisions of the Black Money Act. According to the learned counsel, the foreign income of the contesting respondents was assessed under the Income Tax Act and not under the Black Money Act and, therefore, the Settlement Commission had exclusive jurisdiction to tax the respondents. It was pointed out that it is not in dispute that what is offered for tax by the contesting respondents before the Settlement Commission is income earned by them in Page 31 of 93 C/SCA/9883/2019 JUDGMENT foreign countries during assessment year 2004-05 to assessment year 2015-16. What is offered to tax is income and all this income was earned before the Black Money Act was made applicable to undisclosed foreign income, that is, from assessment year 2016-2017. It was submitted that the nature of income and source thereof is not doubted by the income tax department at any stage and hence, remain accepted and that only item VI (Unexpected investment in the land by the applicants as shown in SOF) is an asset, whereas the rest is income. It was pointed out that even the asset is located in India and not outside India and hence, is not a foreign asset. 4.2 It was submitted that section 4(1)(a) and 4(1)(b) of the Black Money Act would only cover such income and that too only from assessment 2016-2017. Further, section 4(1)(c) of the Black Money Act which makes \"undisclosed asset located outside India” taxable under Black Money Act has no application in the facts of the present case as what the Settlement Commission has taxed is income and not any asset as per the Black Money Act. It was submitted that this contention gets further strength from the fact that the contesting respondents had earned “undisclosed foreign income and asset” in terms of 2(12) of the Black Money Act, albeit during the period the Black Money Act was not in force. 4.3 It was submitted that even presently, it is the IT Act that empowers the authorities under that Act to tax undisclosed foreign income by reopening any past assessment years up to as many as sixteen years. In this regard, reference was made to the second proviso to section 147 of the IT Act which Page 32 of 93 C/SCA/9883/2019 JUDGMENT provides that nothing provided in the first proviso shall apply in a case where any income in relation to any asset (including financial interest in any entity) located outside India, chargeable to tax, has escaped assessment for any assessment year; as well as to section 149(1)(c) of the IT Act which provides for an outer limit of sixteen years for issuance of notice under section 148 of that Act where the income in relation to any asset (including financial interest in any entity) located outside India, chargeable to tax has escaped assessment. 4.4 It was submitted that the foreign income of the contesting respondents for the period under consideration has therefore, been rightly assessed under the IT Act and not under the Black Money Act and that the Settlement Commission had the exclusive jurisdiction to tax the contesting respondents. Therefore, the order made by the Settlement Commission has to be implemented and in fact the revenue authorities have implemented such order and recovered the amount due thereunder. 4.5 Reliance was placed upon the decision of the Orissa High Court in the case of Commissioner of Income-tax, Sambalpur v. Income-tax Settlement Commission (IT & WT), (2016) 289 CTR 569 (Orissa), wherein it has been laid down that when the revenue implements and enforces the final order of the Settlement Commission and demands and recovers the amounts payable thereunder, the finality of the Settlement Commission’s order is attracted with full force and the revenue thereafter cannot in law challenge the order. The Page 33 of 93 C/SCA/9883/2019 JUDGMENT learned counsel submitted that in the facts of the present case also, before the Settlement Commission. it had not been agitated that the Commission lacks jurisdiction to decide the applications under section 245C of the IT Act and that on the contrary, when the Settlement Commission inquired from the Department as to whether they want to proceed under the provisions of the Black Money Act or the provisions of the Income Tax Act, the petitioner had categorically stated that they wanted to proceed under the provisions of the Income Tax Act. It was submitted that, therefore, it is not open for the petitioner to invoke the writ jurisdiction of this court under article 226 of the Constitution of India to challenge the order of the Settlement Commission and on this ground alone the writ petition requires to be summarily dismissed. 4.6 Next, it was submitted that the present writ petition was filed in May, 2019 wherein there is no mention of the consequential orders, notices of demand and the fact of payment of the amount under the order of the Settlement Commission. Thus, there is suppression of vitally material facts and on this ground of suppression alone, the writ petition deserves to be dismissed. 4.7 Dealing with the contention advanced on behalf of the petitioner that undisclosed foreign income and assets can be dealt with exclusively under the Black Money Act, it was submitted that this argument is devoid of any merit whatsoever, because undisclosed foreign assets and foreign income can lawfully be dealt with either under the IT Act or the Black Money Act even after 1.7.2015. To substantiate such Page 34 of 93 C/SCA/9883/2019 JUDGMENT argument, the learned counsel submitted that it is very well settled legal position that the pre-existing jurisdiction of a statutory can be ousted or set at naught only by a specific and unequivocal statutory provision. There is no “exclusivity” or “ouster” or “non-obstante” provision whatsoever in the Black Money Act which provides that, after 1.7.2015, the authorities under the IT Act have no jurisdiction or authority of law to deal with or assess undisclosed foreign assets or foreign income. Instead, the Black Money Act contains several provisions which clearly recognize and permit the assessment of foreign undisclosed assets/income under the IT even after the coming into force of the Black Money Act on 1.7.2015. In this regard, the reference was made to sub-clause (a) of clause (ii) of sub- section (1) of section 5 of the Black Money Act, which provides that in computing the total undisclosed foreign income and asset of any previous year of an assessee, any income which has been assessed to tax for any assessment year under the Income Tax Act prior to the assessment year to which the Act applies, or which is assessable or has been assessed to tax for any assessment year under the Act shall be reduced from the value of the undisclosed asset located outside India, if the assessee furnishes evidence to the satisfaction of the Assessing Officer that the asset has been acquired from the income which has been assessed or is assessable, as the case may be, to tax. It was submitted that it is very significant that section 5(1) refers to any previous year and clause (ii) (a) refers to any assessment year under the Income-tax Act prior to the assessment year to which the Black Money Act applies. Section 5(1)(ii)(a), therefore, applies if there is an assessment order under the Income-tax Act for any assessment year prior to assessment year 2016-17 whereby the foreign assets or Page 35 of 93 C/SCA/9883/2019 JUDGMENT income have been assessed. The date on which such assessment order has been passed is immaterial. Only the assessment year to which the order relates is material, and it has to be an assessment year before assessment year 2016- 17. 4.8 It was submitted that in the present case, the order dated 30.1.2019 of the Settlement Commission is an assessment order which relates to assessment years prior to assessment year 2016-17. All the foreign assets and foreign income of the contesting respondents have been assessed and covered by that order, which also gives a specific finding that all the foreign assets and income of these respondents have been fully disclosed and nothing remains. It was submitted that the Illustration to section 5(1) makes it clear that even if there has been an appreciation in the market value of the foreign assets, there would be no balance amount which could be charged under the Black Money Act. Referring to the illustration it was submitted that in the illustration, the original cost of the foreign asset was Rs.50 lakhs, but only 40 % thereof, that is, Rs.20 lakhs was disclosed to and taxed by the authorities in assessment year 2009-10. The current market value of the asset in the year in which it came to the notice of the tax authorities is Rs. 1 crore. As only 40 % of the original cost of acquisition had been disclosed and taxed in assessment 2009- 10 the balance 60% of the current market value of the asset, that is, Rs.60 lakhs can now be taxed under the Black Money Act. This Illustration shows that if the full cost of acquisition of Rs.50 lakhs had been disclosed and taxed in assessment 2009- 10 then there would be no balance amount liable to be taxed under the Black Money Act. According to the learned counsel, Page 36 of 93 C/SCA/9883/2019 JUDGMENT this is exactly the situation in the present case, because the Settlement Commission has given a specific finding that all of the contesting respondents’ foreign assets and income have been fully disclosed and nothing remains. This finding of the Settlement Commission has not even been attempted to be challenged by the revenue and that it has not even alleged that the contesting respondents have any foreign income or foreign asset which is not covered by the said order of the Settlement Commission. In these circumstances, there is no scope whatsoever for applying the provisions of the Black Money Act to the contesting respondents. It was contended that in any event, the order dated 30.1.2019 of the Settlement Commission cannot be challenged by the revenue by relying on the provisions of the Black Money Act. 4.9 Reference was made to sub-section (2) of section 4 of the Black Money Act, which provides that notwithstanding anything contained in sub-section (1), any variation made in the income from a source outside India in the assessment or reassessment of the total income of any previous year, of the assessee under the Income-tax Act in accordance with the provisions of section 29 to section 43C or section 57 to section 59 or section 92C of the said Act, shall not be included in the total undisclosed foreign income. It was submitted that, therefore, like section 5(1)(ii)(a), sub-section (2) of section 4 of the Black Money Act not only recognises an assessment made under the IT Act in respect of foreign income and asset, but also grants a set-off or adjustment of the same in the assessment under the Black Money Act. 4.10 Next it was submitted that section 59 of the Black Page 37 of 93 C/SCA/9883/2019 JUDGMENT Money Act includes in “undisclosed foreign asset” only those assets which have not been disclosed and assessed by the IT authorities. It was accordingly submitted that the above mentioned provisions of the Black Money Act completely falsify the argument of exclusivity canvassed by the petitioner. 4.11 Inviting the attention of the court to Circular No.13 dated 6th July, 2015 issued by the Central Board of Direct Taxes in the context of the provisions of the Black Money Act, and more particularly to questions 6, 16 and 28 and the answers thereto, it was submitted that the same make it clear that foreign assets/income can be taxed either under the IT Act or under the Black Money Act. It was contended that this circular also, by itself, destroys the revenue's argument of “exclusivity”. 4.12 Referring to sub-section (3) of section 4 of the Black Money Act, on which strong reliance has been placed on behalf of the petitioner to contend that the same excludes the jurisdiction of the Income Tax authorities insofar as foreign income and asset are concerned, the learned counsel submitted that sub-section (3) provides that the income included in the total undisclosed foreign income and asset under the Black Money Act shall not form part of the total income under the Income-tax Act. Therefore, all that the sub- section provides is that the income included under the Black Money Act cannot be included under the Income Tax Act, whereas in this case the undisclosed foreign income of the contesting respondents for the period covered by the order of the Settlement Commission stands assessed under the Income Page 38 of 93 C/SCA/9883/2019 JUDGMENT Tax Act and, therefore, the provisions of the Black Money Act would not apply to the such income. 4.13 Referring to section 3 of the Black Money Act, it was submitted that this is the charging section and the charge under the Black Money Act applies from the 1st day of April, 2016 onwards whereas the order of the Settlement Commission deals with the period prior to 1.4.2016, that is, till assessment year 2015-16. It was submitted that, therefore, the provisions of the Black Money Act would not be applicable to the undisclosed foreign income and asset which the contesting respondents have disclosed before the Settlement Commission as the same relate to the period prior to 1.4.2016. 4.14 Insofar as the contention raised on behalf of the petitioner that the contesting respondents were covered by the definition of the expression “assessee” as defined under sub- section (2) of section 2 of the Black Money Act even prior to its amendment as the contesting respondents were assessees in default, the learned counsel submitted that in sub-section (2) of section 2 of the Black Money Act, the expression “assessee in default” is a deeming fiction whereby a person is deemed to be an assessee in default. Reference was made to sub-sections (4) and (5) of section 30 as well as sub-section (14) of section 32 of the Black Money Act, to submit that these are the only provisions under the Black Money Act where an assessee is deemed to be in default. It was submitted that this being a legal fiction, one can only look at these provisions and the legal fiction cannot be read into section 59 and section 72(c) of the Black Money Act as is sought to be contended on behalf of Page 39 of 93 C/SCA/9883/2019 JUDGMENT the petitioner. It was submitted that a person cannot be an assessee in default unless proceedings under the Black Money Act are initiated and concluded and demand notice is issued and not paid under section 30(4), or in the circumstances set out in section 30(5) and section 32(14) of the Black Money Act. Therefore, the contesting respondents cannot be considered as assessees in default under the provisions of the Black Money Act. 4.15 The learned counsel also submitted that in any case section 59 of the Black Money Act has been introduced as an opportunity to the assessee to make disclosure of undisclosed foreign assets and is entirely voluntary. Reference was made to the decision of the Supreme Court in Union of India and Others v. Gautam Khaitan (supra), wherein the court has held thus: “13. A perusal of Section 59 of the Black Money Act would further reveal, that an opportunity is given to the assessee to make a declaration in respect of any undisclosed asset located outside India and acquired from income chargeable to tax under the Income tax Act, for any assessment year prior to the assessment year beginning on 01.04.2016. Section 59 further provides, that such a declaration has to be made on or after the date of commencement of the Black Money Act, however, before the date to be notified by the Central Government. The Central Government, in exercise of the powers under Section 59 of the Black Money Act, published a Notification on 01.07.2015, notifying 30.09.2015 as the date on or before which a person is required to make a declaration in respect of an undisclosed asset located outside India. It also notifies 31.12.2015 as the date on or before which the person shall pay the tax and penalty in respect of such undisclosed asset located outside India. 14. It could thus be seen, that Section 59 of the Black Page 40 of 93 C/SCA/9883/2019 JUDGMENT Money Act gives an opportunity to the assessees who have acquired an asset located outside India, which is acquired from income chargeable to tax under the Income tax Act. The assessee has been given an opportunity to declare such asset and pay the tax and penalty thereon. The consequences of the non declaration have been provided under Section 72(c) of the Black Money Act, which reads thus: “Section 72 Removal of doubts. – For the removal of doubts, it is hereby declared that (a) … (b) … (c) where any asset has been acquired or made prior to commencement of this Act, and no declaration in respect of such asset is made under this Chapter, such asset shall be deemed to have been acquired or made in the year in which a notice under section 10 is issued by the Assessing Officer and the provisions of this Act shall apply accordingly.” 15. It could therefore be seen, that where no declaration in respect of the asset covered under the Black Money Act is made, such asset would be deemed to have been acquired or made in the year in which a notice under Section 10 is issued by the Assessing Officer and the provisions of the Act shall apply accordingly.” 4.16 It was contended that if an assessee chooses not to file such declaration, the only consequences would be in terms of paragraph 15 of the above decision and such asset would be deemed to have been acquired or made in the year in which a notice under section 10 is issued by the Assessing Officer and the provisions of the Act shall apply accordingly as enshrined in section 72(c) of the Black Money Act. Therefore, under these circumstances, the failure to file declaration cannot render a person to be an assessee in default. Page 41 of 93 C/SCA/9883/2019 JUDGMENT 4.17 It was also argued that in any case, the section 59 of the Black Money Act pertains to undisclosed asset located outside India as defined in section 2(11) of the Black Money Act; whereas, in the present case, the respondents had earned undisclosed foreign income. It was further submitted that a foreign asset will become undisclosed foreign asset only if the source thereof cannot be explained, whereas, in case of the contesting respondents, the sources have been accepted and, therefore, there is no undisclosed foreign asset. Hence, even otherwise the provision is not applicable. 4.18 The learned counsel further submitted that the contesting respondents were undisputedly not assessees when the proceedings were pending before the Settlement Commission. It was pointed out that even the notices issued to the contesting respondents under section 10 of the Black Money Act relate only to assessment year 2017-18 and assessment year 2018-19, which have been duly replied by them. Therefore, even when the Department took action under the Black Money Act, they have taken action for assessment years subsequent to the assessment year commencing on the 1st day of April, 2016, which cannot have any impact on the order passed by the Settlement Commission. 4.19 Dealing with the contention raised on behalf of the petitioner that the Black Money Act being a special Act, the provisions thereof would prevail over the Income Tax Act, 1961 which is a general Act, the learned counsel submitted that insofar as the Black Money Act and the Income Tax Act are concerned, the Black Money Act which is the special Act makes Page 42 of 93 C/SCA/9883/2019 JUDGMENT reference to the general statute viz. the Income Tax Act and provides for deduction of tax paid under the general statute. It was pointed out that the Black Money Act contains provisions for adjustment and set off, to submit that the special Act recognizes action taken under the general Act and therefore, the position is different. 4.20 It was submitted that under section 3 of the Black Money Act, the said Act applies from assessment year 2016-17 onwards. Section 5(1)(ii)(a) of the Black Money Act refers to assessment under the IT Act in relation to assessment years previous to assessment year 2016-17. Therefore, the date of the assessment order is not material, if the assessment under the IT Act relates to assessment years prior to assessment year 2016-17. It was submitted that the Settlement Commission has passed the impugned order up to and including assessment year 2015-16, and hence, the order is squarely covered by section 5(1)(ii)(a) of the Black Money Act and the benefit of the full amount assessed under the IT Act is required to be given while computing the total undisclosed foreign income and asset under the Black Money Act. 4.21 As regards the contention that a full and true disclosure was not made in the applications under section 245C of the IT Act, because the contesting respondents had agreed to pay additional amount during the course of the settlement proceedings, it was submitted that no additional disclosure of undisclosed foreign income or asset was made during the course of settlement proceedings and that it was only in the spirit of settlement, to buy peace that the additional Page 43 of 93 C/SCA/9883/2019 JUDGMENT amount was offered by the contesting respondents. It was pointed out that the additional amounts offered come to only 7 or 8% of the amount of foreign income and asset disclosed in the applications under section 245C of the Act, and hence, reliance placed by the petitioner on the decision of the Supreme Court in Ajmera Housing Corporation (supra) is misconceived. It was, accordingly, urged that the petition being devoid of any merit deserves to be dismissed. 5. In rejoinder, the learned Additional Solicitor General submitted that this court has the jurisdiction to adjudicate the present matter as the impugned order passed by the Settlement Commission is without jurisdiction. In support of such submission the learned counsel placed reliance upon the decision of the Supreme Court in Whirlpool Corporation v. Registrar of Trade Marks, (1998) 8 SCC 1, wherein it has been held thus: “15. Under Article 226 of the Constitution, the High Court, having regard to the facts of the case, has a discretion to entertain or not to entertain a writ petition. But the High Court has imposed upon itself certain restrictions one of which is that if an effective and efficacious remedy is available, the High Court would not normally exercise its jurisdiction. But the alternative remedy has been consistently held by this Court not to operate as a bar in at least three contingencies, namely, where the writ petition has been filed for the enforcement of any of the Fundamental Rights or where there has been a violation of the principle of natural justice or where the order or proceedings are wholly without jurisdiction or the vires of an Act is challenged. There is a plethora of case-law on this point but to cut down this circle of forensic whirlpool, we would rely on some old decisions of the evolutionary era of the constitutional law as they still hold the field.” Page 44 of 93 C/SCA/9883/2019 JUDGMENT 5.1 Dealing with the contention raised on behalf of the contesting respondents that as per section 245-I of the IT Act, every order of settlement passed under section 245D(4) shall be conclusive as to the matter stated therein and no matter covered by such order shall be reopened in any proceeding under the Act or under any law for the time being in force, it was submitted that section 245-I of the IT Act does not and cannot bar the jurisdiction of this court under article 226 of the Constitution of India. In support of such submission, reliance was placed upon the decision of the Supreme Court in Jyotendrasinhji v. S.I. Tripathy, 1993 Supp (3) SCC 389, wherein it has been held thus: 16. It is true that the finality clause contained in Section 245-I does not and cannot bar the jurisdiction of the High Court under Article 226 or the jurisdiction of this Court under Article 32 or under Article 136, as the case may be. But that does not mean that the jurisdiction of this Court in the appeal preferred directly in this Court is any different than what it would be if the assessee had first approached the High Court under Article 226 and then come up in appeal to this Court under Article 136. A party does not and cannot gain any advantage by approaching this Court directly under Article 136, instead of approaching the High Court under Article 226. This is not a limitation inherent in Article 136; it is a limitation which this Court imposes on itself having regard to the nature of the function performed by the Commission and keeping in view the principles of judicial review. Maybe, there is also some force in what Dr Gauri Shankar says viz., that the order of the Commission is in the nature of a package deal and that it may not be possible, ordinarily speaking, to dissect its order and that the assessee should not be permitted to accept what is favourable to him and reject what is not. According to learned counsel, the Commission is not even required or obligated to pass a reasoned order. Be that as it may, the fact remains that it is open to the Page 45 of 93 C/SCA/9883/2019 JUDGMENT Commission to accept an amount of tax by way of settlement and to prescribe the manner in which the said amount shall be paid. It may condone the defaults and lapses on the part of the assessee and may waive interest, penalties or prosecution, where it thinks appropriate. Indeed, it would be difficult to predicate the reasons and considerations which induce the Commission to make a particular order, unless of course the Commission itself chooses to give reasons for its order. Even if it gives reasons in a given case, the scope of enquiry in the appeal remains the same as indicated above viz., whether it is contrary to any of the provisions of the Act. In this context, it is relevant to note that the principle of natural justice (audi alteram partem) has been incorporated in Section 245-D itself. The sole overall limitation upon the Commission thus appears to be that it should act in accordance with the provisions of the Act. The scope of enquiry, whether by High Court under Article 226 or by this Court under Article 136 is also the same — whether the order of the Commission is contrary to any of the provisions of the Act and if so, has it prejudiced the petitioner/appellant apart from ground of bias, fraud and malice which, of course, constitute a separate and independent category. ……” 5.2 It was accordingly urged, that against the impugned order passed by the Settlement Commission, the petitioner has rightly invoked the writ jurisdiction of this court. 6. The facts as emerging from the record are that a search and seizure operation came to be carried out at the residential and business premises of the Banco Group of Companies of which the contesting respondents are directors. Pursuant to the search, notices under section 148 and section 153A of the Income Tax Act, 1961 came to be issued for assessment years 2005-06 to 2013-14 in case of the respondent No.2, for assessment years 2004-05 to 2015-16 in case of the respondent No.3 and for assessment years 2004-05 to 2015-16 Page 46 of 93 C/SCA/9883/2019 JUDGMENT in case of the respondent No.4. In response thereto, the respondents No.2, 3 and 4 filed income tax returns disclosing undisclosed foreign income and assets of Rs.13,05,36,593/-, Rs.12,05,39,478/- and Rs.13,70,81,928/- respectively, in all, amounting to Rs.38,81,57,999/-. The respondents No.2, 3 and 4 thereafter filed separate applications under section 245C of the IT Act before the Settlement Commission disclosing additional undisclosed foreign income and asset of Rs.28,32,25,000/-, Rs.24,71,00,000/- and Rs.37,25,00,000/- respectively, in all, amounting to Rs.90,28,25,000/-. Accordingly, the total additional income declared by the respondents No.2, 3 and 4 came to Rs.41,37,61,593/-, Rs.36,76,39,478/-, 50,95,82,999/- respectively, in all, Rs.129,09,82,999/-. 6.1 By an order dated 14.8.2017 passed under section 245D (1) of the IT Act, the applications were admitted and allowed to be proceeded with. Thereafter, vide letter dated 14.11.2017, the PCIT Central Surat (the petitioner herein) filed a report under rule 9 of the Income Tax Settlement Commission (Procedure) Rules, 1997 on 16.11.2017. The contesting respondents filed their replies thereto. Thereafter, further reports were filed from time to time, in response to which the contesting respondents filed their replies. During the course of the settlement proceedings, by letters dated 4.12.2017 and 21.3.2018, the PCIT Central Surat requested the Settlement Commission to make inquiry under section 245D (3) of the IT Act with respect to various foreign bank accounts and foreign assets by making a reference to Foreign Tax & Tax Research Division of the Central Board of Direct Taxes, New Delhi. According, the Settlement Commission by an order dated Page 47 of 93 C/SCA/9883/2019 JUDGMENT 25.5.2018 made under section 245D (3) of the IT Act, accorded permission to make reference to the FT & TR Division of the CBDT for submitting the requisite report. 6.2 It appears that during the course of the proceedings before the Settlement Commission, the PCIT had submitted a further verification report dated 23.10.2018 in terms of the directions issued by the Settlement Commission. By the said report the Settlement Commission was also intimated that proceedings under the Black Money Act have been initiated in the case of all the three applicants (the contesting respondents) by issuing notices under section 10 of that Act for assessment years 2017-18 and 2018-19 for which proceedings are pending. 6.3 On the next date of hearing, the PCIT submitted a further verification report dated 10.12.2018 as per the directions of the Settlement Commission, wherein it was inter alia stated thus: “2. Whether the department wants to continue proceedings under Black Money Act or proceedings u/s.148 in respect of same income and same assessee in this regard, following is submitted:- 2.1 It is pertinent to mention here that proceedings under Black Money Act have been initiated in respect of Shri Vimal Patel, Shri Samir Patel and Shri Mehul Patel for Ays 2017-18 and 2018-19. However, proceedings u/s.147 of the Income-tax Act, 1961 (Act) was initiated for A.Ys. 2001-02 to A.Y. 2007-08 in all the three brothers. Therefore, the period under the purview of both the proceedings is different. 2.2 Moreover, notwithstanding the above fact, the following facts are to be kept in consideration on the Page 48 of 93 C/SCA/9883/2019 JUDGMENT issue of applicability of BM Act, proceedings u/s.147 and 153A/C pending before Hon’ble ITSC:- 2.3 For the purpose of seeking clarity for applicability of the provisions of the Black Money Act to the concerned assessees, a view was sought from the senior standing counsel for the Department. As per her opinion, the proceedings u/s.10 of the Black Money Act can be initiated against the assessee, however, the income which is determined by the Hon’ble Settlement Commission is to be reduced from the income assessed u/s.10 of the Black Money Act. The concerned portion from the legal opinion as provided by Sr. Standing Counsel is reproduced below:- “Whether notice u/s. 10 of the Act can be issued for those assessment years for which settlement proceedings are pending before the Settlement Commission? The proceedings before the Settlement Commission are under the provisions of the Income tax Act. Thus, though notice under section 10 can be issued for the Assessment Years for which settlement proceedings are pending before the Settlement Commission, ultimately benefit will be required to be granted while computation under Section 5 of the Act.” Thus, it is clear that the proceedings under Black Money Act and under Income-tax Act are not mutually exclusive to each other. Both can be legally carried out at the same time as per the provisions of both the Acts. However, the benefit of tax paid under provisions of the Income-tax Act will be provided to the assessee under Black Money Act. 2.4 It is also brought to the notice of the Hon’ble Settlement Commission that based on the SOF filed by the applicants, references have been forwarded to various foreign jurisdictions through FT&TR, CBDT for getting the details of the bank accounts and other investments, as disclosed. Now the details as sought are awaited from the foreign jurisdictions. It is important to note the provisions of section 11(1) of the Black Money Act which is reproduced as follows, Page 49 of 93 C/SCA/9883/2019 JUDGMENT “No order of assessment or reassessment shall be made under section 10 after the expiry of two years from the end of the financial year in which the notice under sub- section (1) of section 10 was issued by the Assessing Officer.” Further the explanation 1 to section 11 prescribes the manner of computing period of limitation for the purposes of this section in certain cases, which is as follows:- “Explanation 1.— In computing the period of limitation for the purpose of this section …. ….. (iii) the period commencing from the date on which a reference or first of the references for exchange of information is made by an authority competent under an agreement referred to in section 90 or section 90A of the Income-tax Act or under section 73 of this Act and ending with the date on which the Principal Commissioner or the Commissioner last receives, the information so requested or a period of one year, whichever is less, shall be excluded. Since we are awaiting the details, the department would like to reserve its right to bring to tax the true and correct income under the Black Money Act accordingly. 2.5 Considering the same, it would be more appropriate to continue with the assessment of income under the Income-tax Act under the provisions of section 147 for which the assessee has already admitted income. If there is an income which is not assessed under the said section, then the difference will be brought to tax under the Black Money Act as per the relevant provisions thereof and legal opinion of Sr. Standing Counsel of the Department.” 6.4 It appears that in view of the above stand of the revenue that proceedings under Black Money Act and under Income-tax Act are not mutually exclusive to each other; both can be legally carried out at the same time as per the provisions of both the Acts; however, the benefit of tax paid under provisions of the Income-tax Act will be provided to the Page 50 of 93 C/SCA/9883/2019 JUDGMENT assessee under Black Money Act; and that it would be more appropriate to continue with the assessment of income under the Income-tax Act under the provisions of section 147 for which the assessee has already admitted income; that the Settlement Commission proceeded further. 6.5 During the course of the settlement proceedings, on 17.12.2018, the contesting respondents, with a view to settle the issues, in the spirit of settlement offered further additional income vide their submissions filed on 17.12.2018. It appears that the PCIT sought further time for conducting necessary inquiries and verification of certain intelligence inputs received by them. Accordingly, further time was granted to them till 7.1.2019; however, no further progress was reported and hence, as a last chance further time was granted till 14.1.2019 as the matters were getting time barred on 31.1.2019. Since no further progress was reported, the hearing was concluded on 14.1.2019. Thereafter, the Settlement Commission passed the impugned order dated 30.1.2019 under section 245D (4) of the IT Act. In paragraph 14 of the impugned order, the Settlement Commission ordered that the applicants shall pay the taxes including interest payable as per that order in four quarterly installments beginning March 2019 and ending in December 2019. 6.6 Subsequently, on 18.2.2019, the Assessing Officer passed orders giving effect to the order of the Settlement Commission and determined the additional tax payable, and notices of demand under section 156 of the IT Act came to be issued on the same day calling upon the contesting respondents to pay the amount within a period of thirty days of Page 51 of 93 C/SCA/9883/2019 JUDGMENT the service of notice failing which proceedings for recovery thereof would be taken. Thereafter, each of the contesting respondents has paid the additional tax payable. The present petition came to be filed subsequent thereto on 30.5.2019 and notice was issued on 31.5.2019. 6.7 During the pendency of this petition, section 2(2) of the Black Money Act which defines “assessee” came to be amended on 1st August, 2019 vide Finance (No.2) Act 2019 with retrospective effect from 1st July, 2015. 7. It is in the aforesaid factual backdrop that the validity of the impugned order passed by the Settlement Commission is required to be examined. 8. At the outset, the preliminary objection as to the maintainability of the petition may be considered. As held by the Supreme Court in the case of Jyotendrasinhji v. S.I. Tripathy (supra), the finality clause contained in section 245-I of the IT Act does not and cannot bar the jurisdiction of the High Court under article 226 of the Constitution of India. Therefore, it is not possible to state that this petition under articles 226 and 227 of the Constitution of India is not maintainable. At the same time it has to be kept in mind that the scope of inquiry under article 226 is limited to whether the order of the Settlement Commission is contrary to any of the provisions of the IT Act. 9. Adverting to the merits of the case, the main contention raised by the learned Additional Solicitor General appearing on behalf of the petitioner is that the order passed by the Page 52 of 93 C/SCA/9883/2019 JUDGMENT Settlement Commission is without jurisdiction on the ground that the provisions of sections 3, 4, 10, 59 and 72 of the Black Money Act form a complete regime for assessment of undisclosed foreign income and assets under the Black Money Act and that sub-section (3) of section 4 of the said Act ousts the operation of the IT Act in respect thereof. According to the learned counsel, insofar as domestic income and assets are concerned, it is the income-tax authorities who have the jurisdiction to assess such income; however, insofar as undisclosed foreign income and assets are concerned, it is only the authorities under the Black Money Act who have the jurisdiction to assess such income. Such contention has been resisted by the contesting respondents on the ground that during the course of the settlement proceedings, the Department had requested the Settlement Commission to proceed further and decide the applications under section 245C of the IT Act despite the fact that notices under section 10 of the Black Money Act had been issued for assessment years 2017-18 and 2018-19. 10. In this regard, while it is true that the petitioner had specifically invited the Settlement Commission to decide the applications made by the contesting respondents under section 245C of the IT Act, nonetheless, it is equally true that if the Settlement Commission lacked the jurisdiction to decide such applications, any consent given by the petitioner would be of no avail. 11. The question that, therefore, arises for consideration is whether the Settlement Commission lacked the jurisdiction to decide the applications under section 245C of the IT Act. Page 53 of 93 C/SCA/9883/2019 JUDGMENT 12. The contentions raised on behalf of the learned counsel for the respective parties have already been noted hereinabove. To begin, it may be apposite to refer to certain provisions of the Black Money Act to understand the scheme of that Act. Section 3 of the Black Money Act is the charging section and reads thus: 3. Charge of tax.- (1) There shall be charged on every assessee for every assessment year commencing on or after the 1st day of April, 2016, subject to the provisions of this Act, a tax in respect of his total undisclosed foreign income and asset of the previous year at the rate of thirty per cent of such undisclosed income and asset: Provided that an undisclosed asset located outside India shall be charged to tax on its value in the previous year in which such asset comes to the notice of the Assessing Officer. (2) For the purposes of this section, \"value of an undisclosed asset\" means the fair market value of an asset (including financial interest in any entity) determined in such manner as may be prescribed. 13. Section 3 of the Black Money Act which is the charging section can be broken up and analysed as under: − subject to the provisions of that Act − for every assessment year commencing on or after the 1st day of April, 2016 − a tax shall be charged in respect of the total undisclosed foreign income and asset of the previous year − at the rate of 30% of such undisclosed foreign income and asset. Page 54 of 93 C/SCA/9883/2019 JUDGMENT The proviso thereto provides that − an undisclosed asset located outside India − shall be charged to tax on its value − in the previous year in which such asset comes to the notice of the Assessing Officer. 14. Thus, while in case of undisclosed foreign income of an assessee, the same would be subject to tax under the provisions of the Black Money Act only for every assessment year commencing on or after the 1st day of April 2016, namely assessment year 2016-17 onwards, insofar as undisclosed foreign asset located outside India is concerned, the previous year in which such asset is acquired is not relevant. In other words an undisclosed foreign asset would be subject to tax under the Black Money Act notwithstanding the date of its acquisition, which may even be a previous year prior to the assessment year commencing on 1st April 2016; and shall be charged to tax under this provision on the value of such asset in the previous year in which such asset comes to the notice of the Assessing Officer. 15. Section 4 of the Black Money Act provides for the “Scope of total undisclosed foreign income and asset”and reads as under: “4. Scope of total undisclosed foreign income and asset.— (1) Subject to the provisions of this Act, the total undisclosed foreign income and asset of any previous year of an assessee shall be,— (a) the income from a source located outside India, which has not been disclosed in the return of income furnished within the time specified in Explanation 2 to sub-section (1) or under sub- Page 55 of 93 C/SCA/9883/2019 JUDGMENT section (4) or sub-section (5) of Section 139 of the Income Tax Act; (b) the income, from a source located outside India, in respect of which a return is required to be furnished under Section 139 of the Income Tax Act but no return of income has been furnished within the time specified in Explanation 2 to sub- section (1) or under sub-section (4) or sub-section (5) of Section 139 of the said Act; and (c) the value of an undisclosed asset located outside India. (2) Notwithstanding anything contained in sub-section (1), any variation made in the income from a source outside India in the assessment or reassessment of the total income of any previous year, of the assessee under the Income Tax Act in accordance with the provisions of Section 29 to Section 43-C or Section 57 to Section 59 or Section 92-C of the said Act shall not be included in the total undisclosed foreign income. (3) The income included in the total undisclosed foreign income and asset under this Act shall not form part of the total income under the Income Tax Act.” 16. The expression “previous year” has been defined under sub-section (9) of section 2 of the Black Money Act and reads thus: “previous year” means - (a) the period beginning with the date of setting up of a business and ending with the date of the closure of the business or the 31st day of March following the date of setting up of such business, whichever is earlier; (b) the period beginning with the date on which a new source of income comes into existence and ending with the date of closure of the business or the 31st day of March following the date on which such new source comes into existence, whichever is earlier; (c) the period beginning with the 1st day of the financial year and ending with the date of discontinuance of the business other than business referred to in clause (b) or dissolution of an Page 56 of 93 C/SCA/9883/2019 JUDGMENT unincorporated body or liquidation of a company, as the case may be; or (d) the period of twelve months commencing on the 1st day of April of the relevant year in any other case, and which immediately precedes the assessment year. 17. On a conjoint reading of section 3 and section 2(9) of the Black Money Act, one thing is clear namely that undisclosed foreign income or asset become chargeable to tax from assessment year 2016-17. However, insofar as undisclosed foreign asset is concerned, while it becomes chargeable to tax from assessment year 2016-17 onwards, the date of acquisition of such asset may relate to any assessment year prior to assessment year 2016-17. Therefore, even after the coming into force of the Black Money Act, insofar as assessment years prior to assessment year 2016-17 are concerned, the undisclosed foreign income would be chargeable to tax under the relevant provisions of the Income Tax Act. 18. Section 5 of the Black Money Act provides for computation of total undisclosed foreign income and asset. Sub-section (1) thereof lays down that in computing the total undisclosed foreign income and asset of any previous year of an assessee,— (i) no deduction in respect of any expenditure or allowance or set off of any loss shall be allowed to the assessee, whether or not it is allowable in accordance with the provisions of the Income-tax Act; (ii) any income, (a) which has been assessed to tax for any assessment year under the Income-tax Act prior to Page 57 of 93 C/SCA/9883/2019 JUDGMENT the assessment year to which that Act applies; or (b) which is assessable or has been assessed to tax for any assessment year under that Act, shall be reduced from the value of the undisclosed asset located outside India, if, the assessee furnishes evidence to the satisfaction of the Assessing Officer that the asset has been acquired from the income which has been assessed or is assessable, as the case may be, to tax. 18.1 Sub-section (2) of section 5 of the Black Money Act provides that the amount of deduction referred to in clause (ii) of sub-section (1) in case of an immovable property shall be the amount which bears to the value of the asset as on the first day of the financial year in which it comes to the notice of the Assessing Officer, the same proportion as the assessable or assessed foreign income bears to the total cost of the asset. 18.2 Thus, sub-section (2) provides for the deduction in case of immoveable property. The illustration thereunder shows the formula for computing the deduction. 19. On behalf of the contesting respondents, it has been contended that when the Settlement Commission passed the order under sub-section (4) of section 245D of the IT Act, the contesting respondents did not fall within the ambit of the expression “assessee” as defined under sub-section (2) of section 2 of the Black Money Act and hence, they were not covered by the provisions of that Act; whereas on behalf of the petitioner it has been contended that the recent amendment in the Black Money Act, the definition of “assessee” under sub- section (2) of section 2 has been widened to include non- Page 58 of 93 C/SCA/9883/2019 JUDGMENT residents under its anvil and the same has been given effect from 1.7.2015. Reliance has been placed on the Explanatory Memorandum to the Finance Bill (2) of 2019, to submit that it makes it clear that the legislative intent behind enacting the Black Money Act was to tax such foreign income and assets which were not charged to tax under the Income Tax Act and, therefore, the contesting respondents were covered by the definition of “assessee” and were required to be assessed under the relevant provisions of the Black Money Act and that the Settlement Commission had no jurisdiction to decide on a subject which falls within the domain of the Black Money Act. Alternatively, it has been contended that even prior to the amendment of the definition of “assessee” the contesting respondents were assessees within the meaning of such expression as defined under section 2(2) of the Black Money Act. 19.1 In this regard, the attention of the court was invited to the provisions of section 59 of the Black Money Act, to submit that the same provides that any person may make, on or after the date of commencement of the Black Money Act but on or before a date to be notified by the Central Government in the Official Gazette, a declaration in respect of any undisclosed asset located outside India and acquired from income chargeable to tax under the Income-tax Act for any assessment year prior to the assessment year beginning on the 1st day of April, 2016 for which he failed to furnish a return under section 139 of the Income Tax Act, 1961 before the date of commencement of the Act or which had escaped assessment by reason of failure on the part of such person to make a return under the Income Tax Act, or to disclose fully Page 59 of 93 C/SCA/9883/2019 JUDGMENT and truly all material facts necessary for assessment or otherwise. According to the learned counsel for the petitioner, a person who does not disclose his foreign assets within the window specified by the Central Government vide notification dated 1.7.2015 wherein 30.9.2015 was notified to be the appointed date on or before which a person may make a declaration in respect of an undisclosed asset outside India and 31.12.2015 was notified as the appointed date on or before which a person shall pay tax and penalty in respect of the undisclosed asset located outside India; such person is an “assessee in default” and is, accordingly covered by the definition of assessee as it stood even prior to its amendment, inasmuch as such definition includes every such person who is “deemed to be an assessee in default” under that Act. It was further submitted that clause (c) of section 72 of the Black Money Act provides that where any asset has been acquired or made prior to the commencement of the Black Money Act and no declaration in respect of such asset is made under Chapter VI then such asset shall be deemed to have been acquired or made in the year in which notice under section 10 has been issued by the Assessing Officer and the provisions of the Black Money Act will apply accordingly. It was submitted that the contesting respondents having not made any declaration as regards their undisclosed assets are assessees in default under the provisions of section 72(c) of the Black Money Act and, therefore, fall within the ambit of the expression “assessee” as defined by section 2(2) of the Black Money Act prior to its amendment. It was submitted that non-declaration of asset under section 59 of the Black Money Act constitutes a default and the assessee would be deemed to be an assessee in default even though the words “assessee in default” are not Page 60 of 93 C/SCA/9883/2019 JUDGMENT used in sections 59 and 72(c) of the Black Money Act. 20. Since the contention raised on behalf of the petitioner is that even prior to its amendment, the contesting respondents came within the ambit of the expression “assessee” as defined under sub-section (2) of section 2 the Black Money Act, reference may be made to the said provision as it stood prior to its amendment vide Finance (No.2) Act, 2019, which reads as under: (2) “assessee” means a person, being a resident other than not ordinarily resident in India within the meaning of clause (6) of section 6 of the Income-tax Act, by whom tax in respect of undisclosed foreign income and assets, or any other sum of money, is payable under this Act and includes every person who is deemed to be an assessee in default under this Act; 21. It is an admitted position that the residential status of the respondents No.3 and 4 was non-resident for assessment year 2016-17 and for respondent No.2 for assessment year 2014-15 onwards. Thus, when the Black Money Act came into force, the contesting respondents were not residents. Since, it is an “assessee” who is a resident who is chargeable to tax under section 3 of the Black Money Act, it is the case of the contesting respondents that having regard to the definition of the term “assessee” as it stood at the relevant time when the impugned order came to be passed by the Settlement Commission, the provisions of the Black Money Act were not applicable to them. Page 61 of 93 C/SCA/9883/2019 JUDGMENT 22. To test the contention of the petitioner that the contesting respondents are deemed to be assessees in default as contemplated in the unamended section 2(2) of the Black Money Act, it would be necessary to refer to the provisions of the Black Money Act wherein the expression “deemed to be an assessee in default” has been employed. 23. Apart from sub-section (2) of section 2 of the Black Money Act, the expression “deemed to be an assessee in default” finds place in sections 30, 32 and section 44 thereof. Section 30 of the Black Money Act provides for recovery of tax dues by Assessing Officer. Sub-section (4) thereof provides that an assessee shall be deemed to be an assessee in default, if the tax arrear is not paid within the time allowed under sub- section (1) or the period reduced under sub-section (2) or extended under sub-section (3), as the case may be. Sub- section (5) of section 30 of the Black Money Act provides that where an assessee defaults in paying any one of the installments within the time fixed under sub-section (3), he shall be deemed to be an assessee in default in respect of the whole of the then outstanding amount. Section 32 of the Black Money Act provides for “Modes of recovery of tax dues”. Sub- section (4) thereof provides that the Assessing Officer or the Tax Recovery Officer may, by notice in writing, require any debtor of the assessee to pay such amount, not exceeding the amount of debt, as is sufficient to meet the tax arrear of the assessee; and sub-section (14) thereof provides that the debtor to whom a notice under sub-section (4) is sent shall be deemed to be an assessee in default, if he fails to make such Page 62 of 93 C/SCA/9883/2019 JUDGMENT payment and further proceedings may be initiated against him for realisation of the amount in the manner provided in that section and the Second Schedule to the Income Tax Act. Section 44 of the Black Money Act provides for penalty for default in payment of tax arrear. Sub-section (1) of section 44 provides that every person who is an assessee in default or and assessee deemed to be in default, as the case may be, in making payment of tax, and in case of continuing default by such assessee, he shall be liable to a penalty of an amount, equal to the amount of tax arrear. 24. Thus, the expression “assessee in default” finds place in the statutory provisions relating to recovery of tax and default in payment of tax arrear. Thus, under the Black Money Act, an assessee is deemed to be an assessee in default if he fails to pay the tax arrear as contemplated under sub-section (4) of section 30, or fails to pay any installment within the time fixed under sub-section (3) of section 30 as contemplated under sub-section (5) of section 30. Under sub-section (14) of section 32 of the Black Money Act, the deeming fiction also applies to any debtor of an assessee who fails to make payment pursuant to a notice issued to him under sub-section (4) of section 32 of the Black Money Act. Thus, under the Black Money Act an assessee is deemed to be in default in the eventualities contemplated under sub-sections (4) and (5) of section 30 of the Black Money Act, and other than an assessee, a debtor of an assessee who fails to make payment pursuant to a notice issued under sub-section (4) of section 32, is deemed to be an assessee in default under section 32(14) of the Black Money Act. Sub-section (1) of section 44 of the Black Money Act, Page 63 of 93 C/SCA/9883/2019 JUDGMENT provides for penalty for default of payment of tax arrear on the part of an assessee in default or an assessee deemed to be in default. 25. Therefore, while sub-sections (4) and (5) of section 30 and sub-section (14) of section 32 of the Black Money Act create a deeming fiction only for the purposes of section 30 and 32 thereof for recovery of tax dues by an Assessing Officer or by a tax recovery officer as the case may be, there is no such deeming fiction contained in section 59 or section 72(c) of the Black Money Act. Therefore, one cannot borrow and automatically apply the concept of “assessee deemed to be in default” to sections 59 and 72(c) of the Black Money Act, which is confined to an assessee who has not paid the tax arrear or an installment within the time fixed or a debtor of an assessee who does not make payment pursuant to a notice issued in this regard. The Black Money Act being a taxing statute is required to be interpreted in the light of what is clearly expressed. Sub- section (4) of section 30 of the Black Money Act is clear and unambiguous and the deeming fiction contained in the expression “assessee in default” relates only to an assessee who has not paid the tax arrear within the time allowed in sub- section (1) of section 30 or the period reduced under sub- section (2) or extended under sub-section (3) thereof fails; similarly the deeming fiction under sub-section (5) of section 30 relates only to an assessee who fails to pay any installment within the time fixed under sub-section (3) of section 30; and the deeming fiction contained in sub-section (14) of section 32 of the Black Money Act applies only to any debtor of an assessee who fails to make payment pursuant to a notice Page 64 of 93 C/SCA/9883/2019 JUDGMENT issued to him under sub-section (4) of section 32 of the Black Money Act. Thus, the deeming fiction contained in sub-sections (4) and (5) of section 30 of the Black Money Act is limited to an assessee who has not paid the tax arrear or not paid any installment as envisaged therein; and the deeming fiction under sub-section (14) of section 32 is limited to a debtor of an assessee who fails to make payment as envisaged therein, and cannot be expanded to cover persons who had not disclosed foreign income or assets within the window provided under the Black Money Act as is sought to be canvassed on behalf of the petitioner. 26. Therefore, the words “assessee in default” contained in sub-section (2) of section 2 of the Black Money Act have to be read accordingly to mean an assessee who has not paid the tax arrear or not paid any installment as envisaged in sub- sections (4) and (5) respectively of section 30, or a debtor of any assessee who has not made payment as envisaged under sub-section (14) of section 30 of the Black Money Act pursuant to a notice issued under sub-section (4) thereof. Consequently, it cannot be said that the contesting respondents fall within the ambit of the expression “assessee” as defined under sub- section (2) of section 2 of the Black Money Act as it stood prior to its amendment by Finance Act (No.2) of 2019. 27. Besides there is an inherent flaw in the contention that a person who does not disclose his undisclosed foreign income or asset within the window provided under the notification issued by the Central Government as contemplated under section 59 of the Black Money Act commits a default inasmuch Page 65 of 93 C/SCA/9883/2019 JUDGMENT as the said section is an enabling provision which enables a person to make a declaration in respect of any undisclosed asset located outside India an acquired from income chargeable to tax under the Income Tax Act for any assessment year prior to the assessment year beginning on the 1st day of April, 2016 as provided thereunder. The Supreme Court in Union of India v. Gautam Khaitan (supra) has held thus: “13. A perusal of Section 59 of the Black Money Act would further reveal, that an opportunity is given to the assessee to make a declaration in respect of any undisclosed asset located outside India and acquired from income chargeable to tax under the Income Tax Act, for any assessment year prior to the assessment year beginning on 01.04.2016. Section 59 further provides, that such a declaration has to be made on or after the date of commencement of the Black Money Act, however, before the date notified by the Central Government. The Central Government, in exercise of the powers under Section 59 of the Black Money Act, published a Notification on 01.07.2015, notifying 30.09.2015 as the date on or before which a person is required to make a declaration in respect of an undisclosed asset located outside India. It also notifies 31.12.2015 as the date on or before which the person shall pay the tax and penalty in respect of such undisclosed asset located outside India. 14. It could thus be seen, that Section 59 of the Black Money Act gives an opportunity to the assessees who have acquired an asset located outside India, which is acquired from income chargeable to tax under the Income Tax Act. The assessee has been given an opportunity to declare such asset and pay the tax and penalty thereon. The consequences of the non-declaration have been provided under Section 72(c) of the Black Money Act, which reads thus: “72. Removal of doubts.— For the removal of doubts, it is hereby declared that— (a) …….. (b) ……… Page 66 of 93 C/SCA/9883/2019 JUDGMENT (c) where any asset has been acquired or made prior to commencement of this Act, and no declaration in respect of such asset is made under this Chapter, such asset shall be deemed to have been acquired or made in the year in which a notice under Section 10 is issued by the Assessing Officer and the provisions of this Act shall apply accordingly.” 15. It could therefore be seen, that where no declaration in respect of the asset covered under the Black Money Act is made, such asset would be deemed to have been acquired or made in the year in which a notice under Section 10 is issued by the Assessing Officer and the provisions of the Act shall apply accordingly.” “19. It could therefore be seen, that the scheme of the Black Money Act is to provide stringent measures for curbing the menace of black money. Various offences have been defined and stringent punishments have also been provided. However, the scheme of the Black Money Act also provided one time opportunity to make a declaration in respect of any undisclosed asset located outside India and acquired from income chargeable to tax under the Income tax Act. Section 59 of the Black Money Act provided that such a declaration was to be made on or after the date of commencement of the Black Money Act, but on or before a date notified by the Central Government in the Official Gazette. The date so notified for making a declaration is 30.09.2015 whereas, the date for payment of tax and penalty was notified to be 31.12.2015. As such, an anomalous situation was arising if the date under subsection (3) of Section 1 of the Black Money Act was to be retained as 01.04.2016, then the period for making a declaration would have been lapsed by 30.09.2015 and the date for payment of tax and penalty would have also been lapsed by 31.12.2015. However, in view of the date originally prescribed by sub- section (3) of Section 1 of the Black Money Act, such a declaration could have been made only after 01.04.2016. Therefore, in order to give the benefit to the assessee(s) and to remove the anomalies the date 01.07.2015 has been substituted in subsection (3) of Section 1 of the Black Money Act, in place of 01.04.2016. This is done, so as to enable the assessee desiring to take benefit of Section 59 of the Black Money Act. By doing so, the assessees, who desired to take the benefit of one time Page 67 of 93 C/SCA/9883/2019 JUDGMENT opportunity, could have made declaration prior to 30th September, 2015 and paid the tax and penalty prior to 31st December, 2015. 20. It would further be relevant to note that subsection (3) of Section 1 of the Black Money Act, itself provides that save as otherwise provided in this Act, it shall come into force on 1 st day of July, 2015. A conjoint reading of the various provisions would reveal, that the Assessing Officer can charge the taxes only from the assessment year commencing on or after 01.04.2016. However, the value of the said asset has to be as per its valuation in the previous year. As such, even if there was no change of date in subsection (3) of Section 1 of the Black Money Act, the value of the asset was to be determined as per its valuation in the previous year. The date has been changed only for the purpose of enabling the assessee(s) to take benefit of Section 59 of the Black Money Act. The power has been exercised only in order to remove difficulties. The penal provisions under Sections 50 and 51 of the Black Money Act would come into play only when an assessee has failed to take benefit of Section 59 and neither disclosed assets covered by the Black Money Act nor paid the tax and penalty thereon. As such, we find that the High Court was not right in holding that, by the notification/order impugned before it, the penal provisions were made retrospectively applicable.” Thus, section 59 of the Black Money Act enables a person to disclose assets covered by the said Act. If a person fails to take the benefit of the section 59, the penal provisions of the Black Money Act would come into play. However, by not disclosing his undisclosed foreign asset which are covered by the Black Money Act, the person does not commit any default under section 59 of that Act, but merely does not avail of the benefit given thereunder. Therefore, on that ground also the contention that the contesting respondents are deemed to be assessees in default for not making declaration within the window provided under section 59 of the Black Money Act Page 68 of 93 C/SCA/9883/2019 JUDGMENT must necessarily fail. 28. The next contention raised on behalf of the petitioner is that sub-section (2) of section 2 of the Black Money Act has been amended with retrospective effect from 1st July, 2015 and therefore, in view of the amended provisions, the contesting respondents would fall within the purview of the expression “assessee”. 29. Sub-section (2) of section 2 of the Black Money Act which defines “assessee” came to be amended vide Finance (No.2) Act, 2019 which came into force on 1st August, 2019 with retrospective effect from 1.7.2015. The amended sub-section (2) of section 2 reads thus: “assessee” means a person, - (a) being a resident in India within the meaning of section 6 of the Income-tax Act, 1961 in the previous year; or (b) being a non-resident or not ordinarily resident in India within the meaning of clause (6) of section 6 of the Income-tax Act, 1961 in the previous year, who was resident in India either in the previous year to which the income referred to in section 4 relates; or in the previous year in which the undisclosed asset located outside India was acquired” 30. Thus under the amended section 2(2), a non-resident or not ordinarily resident who was resident in India either in the previous year to which the income referred to in section 4 relates; or in the previous year in which the undisclosed asset located outside India was acquired has been brought within the ambit of the expression “assessee”. In this regard, it may be noted that the expression “assessee” came to be amended on Page 69 of 93 C/SCA/9883/2019 JUDGMENT 1st August, 2019 albeit with retrospective effect from 1st July, 2015; however, as on the date when the Settlement Commission passed the impugned order viz. 30.1.2019, the contesting respondents were not assessees within the meaning of such expression as contemplated under section 2(2) of the Black Money Act and were, therefore, not covered by the provisions of that Act. Therefore, having regard to the fact that at the relevant time when the order under section 245D of the IT Act came to be passed, the contesting respondents were not assessees as contemplated under the Black Money Act, the provisions thereof did not apply to them and, therefore, the undisclosed foreign income and assets of the contesting respondents could be assessed only under the IT Act. Under these circumstances, the question of lack of jurisdiction on the part of the Settlement Commission to entertain and decide the applications under section 245C of the Income Tax Act did not arise. It is by now well settled that while a statutory provision which has been made applicable retrospectively would be applicable from the date when it is made so applicable, however, the mere fact that it has been made retrospectively applicable would not mean that all acts which stood concluded prior to such amendment would stand invalidated, unless the legislature specifically provides so. Therefore, even if it is assumed for the sake of argument that undisclosed foreign income covered under the Black Money Act cannot be dealt with under the IT Act, at the relevant time when the impugned order under section 245D (4) came to be passed, the contesting respondents were not covered by the provisions of the Black Money Act and, therefore, the Settlement Commission clearly had the jurisdiction to entertain and decide the applications under section 245C of the IT Act. As a Page 70 of 93 C/SCA/9883/2019 JUDGMENT necessary corollary therefore, the impugned order passed in exercise of powers under the IT Act, would not be rendered invalid as being without jurisdiction merely because of a subsequent retrospective amendment in the Black Money Act. 31. Strong reliance has been placed by the learned counsel for the petitioner upon sub-section (3) of section 4 of the Black Money Act, to contend that the same ousts the jurisdiction of the income tax authorities to assess undisclosed foreign income and assets. Sub-section (3) of section 4 of the Black Money Act provides that the income included in the total undisclosed foreign income and asset under that Act shall not form part of the total income under the Income-tax Act. Thus, what sub-section (3) of section 4 of the Black Money Act provides is that what is included as income and asset under the Black Money Act cannot be included in the total income under the IT Act. The said sub-section does not contain a non- obstante clause ousting the applicability of the Income Tax Act insofar as undisclosed foreign income and asset is concerned. The learned Additional Solicitor General appearing on behalf of the petitioner submitted that the court may interpret the provisions of the Black Money Act keeping in mind the object of the enactment, as provided in the statement of objects and reasons, paragraph 1 whereof reads thus: “Stashing away of black money abroad by some people with intent to evade taxes has been a matter of deep concern to the nation. “Black Money” is a common expression used in reference to tax-evaded income. Evasion of tax robs the nation of critical resources necessary to undertake programs for social inclusion and economic development. It also puts a disproportionate burden on the honest taxpayers as they have to bear the Page 71 of 93 C/SCA/9883/2019 JUDGMENT brunt of higher taxes to make up for the revenue leakage caused by evasion. The money stashed away abroad by evading tax could also be used in ways which could threaten the national security.” Reference was also made to the Explanatory Memorandum to the Finance Bill (2) of 2019, to submit that the same makes it clear that the legislative intent behind enacting the Black Money Act was to tax such foreign income and assets which were not charged to tax under the Income Tax Act. 32. The learned Additional Solicitor General further submitted that considering the intent of the legislature behind enacting the Black Money Act, non-providing of a non-obstante clause is clearly an omission on the part of the legislature and hence, the provisions should be interpreted accordingly. It was also suggested that considering the avowed object of the Black Money Act, the provisions thereof should be given an overriding effect over the provisions of the IT Act, though the Black Money Act does not contain any overriding provision. In the opinion of this court, such submission clearly cannot be accepted inasmuch as the Black Money Act is a taxing statute and provides for stringent penalties and prosecution provisions, and it is by now well settled that a taxing statute must be interpreted in the light of what is clearly expressed. The Supreme Court in A. V. Fernandez v. State of Kerala, AIR 1957 SC 657, held that it is no doubt true that in construing fiscal statutes and in determining the liability of a subject to tax one must have regard to the strict letter of law and not merely to the spirit of the statute or the substance of the law. If the Revenue satisfies the Court that the case falls strictly within the provisions of the law, the subject can be Page 72 of 93 C/SCA/9883/2019 JUDGMENT taxed. If, on the other hand, the case is not covered within the four corners of the taxing statute, no tax can be imposed by inference or analogy or by trying to probe into the intentions of the legislature and by considering what was the substance of the matter. 33. In Union of India v. Ind-Swift Laboratories Ltd., (2011) 4 SCC 635, the Supreme Court has, in the context of interpretation of a taxing statute, held thus: “20. A taxing statute must be interpreted in the light of what is clearly expressed. It is not permissible to import provisions in a taxing statute so as to supply any assumed deficiency. In support of the same we may refer to the decision of this Court in CST v. Modi Sugar Mills Ltd. wherein this Court at AIR para 11 has observed as follows: “11. … In interpreting a taxing statute, equitable considerations are entirely out of place. Nor can taxing statues be interpreted on any presumptions or assumptions. The court must look squarely at the words of the statute and interpret them. It must interpret a taxing statute in the light of what is clearly expressed: it cannot imply anything which is not expressed; it cannot import provisions in the statutes so as to supply any assumed deficiency.” 34. Thus, when sub-section (3) of section 4 of the Black Money Act does not contain a non-obstante clause, it is not possible for this court to read one into the sub-section on the ground that there is an omission on the part of the legislature to provide such a provision. When there is no ambiguity in the sub-section the question of reading an omission into the same would not arise. Similarly, without there being any provision giving overriding effect to the provisions of the Black Money Act, it is not possible to read such a provision in the statute Page 73 of 93 C/SCA/9883/2019 JUDGMENT and say that the provisions of the said Act would have overriding effect over the provisions of any other statute. 35. At this stage, it may be apposite to note that there are several provisions under the Income Tax Act, 1961 which cover assessment of undisclosed foreign income. 36. The second proviso to section 147 of the Income Tax Act, 1961 provides that nothing contained in the first proviso to section 147 shall apply in a case where any income in relation to any asset (including financial interest in any entity) located outside India, chargeable to tax, has escaped assessment for any assessment year. The first proviso provides that where an assessment under sub-section (3) of section 143 or this section has been made for the relevant assessment year, no action shall be taken under this section after the expiry of four years from the end of the relevant assessment year, unless any income chargeable to tax has escaped assessment by reason of failure on the part of the assessee to make a return under section 139 or in response to a notice issued under sub- section (1) of section 142 or section 148 or to disclose fully and truly all material facts necessary for his assessment, for that assessment year. Thus, the second proviso does away with the limitation of four years as provided in the first proviso to section 147 in case of undisclosed foreign income. 37. Section 149(1)(c) of the Income Tax Act provides that no notice under section 148 shall be issued for the relevant assessment year if four years, but not more than sixteen Page 74 of 93 C/SCA/9883/2019 JUDGMENT years, have elapsed from the end of the relevant assessment year unless the income in relation to any asset (including financial interest in any entity) located outside India, chargeable to tax, has escaped assessment. Clause (c) of sub- section (1) of section 149 of the IT Act came to be inserted vide Finance Bill 2012 with effect from 1st July, 2012. Thus by virtue of clause (c) of sub-section (1) of section 149, the time limit for reopening of assessment has been extended to sixteen years in respect of any asset including financial interest in any entity located outside India, so that the bar applies for periods beyond sixteen years in such cases. Clearly therefore, the scheme of the Income Tax Act, 1961 is not meant to tax only disclosed foreign income but also undisclosed foreign income. It may also be pertinent to refer to the stand adopted by the petitioner in the proceedings before the Settlement Commission, wherein it was inter alia stated thus: “2. Whether the department want to continue proceedings under the Black Money Act or proceedings u/s. 148 in respect of same income and same assessee in this regard, following is submitted:- 2.1 It is pertinent to mention here that proceedings under Black Money Act have been initiated in respect of Shri Vimal Patel, Shri Samir Patel and Shri Mehul Patel for AYs 2017-18 and 2018-19. However, proceedings u/s. 147 of the Income Tax Act, 1961 (Act) was initiated for A.Ys 2001-02 to A,Y, 2007-08 in all the three brothers. Therefore, the period under the purview of both the proceedings is different. Xxxxxx 2.3 xxxxxx “Whether notice u/s 10 of the Act can be issued for those assessment years for which settlement proceedings are pending before the Settlement Commission? The proceedings before the Settlement Commission are Page 75 of 93 C/SCA/9883/2019 JUDGMENT under the provisions of the Income Tax Act. Thus, though notice under Section 10 can be issued for Assessment Years for which settlement proceedings are pending before the Settlement Commission, ultimately benefit will be required to be granted whole computation under Section 5 of the Act.” “Thus, it is clear that the proceedings under Black Money Act and under Income-tax Act are not mutually exclusive to each other. Both can be legally carried out at the same time as per the provisions of both the Acts. However, the benefit of tax paid under provisions of the Income-tax Act will be provided to the assessee under Black Money Act. Xxxx 2.5 Considering the same, it would be more appropriate to continue with the assessment of income under the Income-tax Act under the provisions of section 147 for which the assessee has already admitted income. If there is an income which is not assessed under the said section, then the difference will be brought to tax under the Black Money Act as per the relevant provisions thereof.” In aforesaid premises, the contention that in view of the provisions of sections 4, 5 and 59 of the Black Money Act, the Black Money Act and the IT Act remain mutually exclusive and there is no overlapping, therefore, does not merit acceptance. 38. As noticed earlier, on the date when the Settlement Commission passed the order, the contesting respondents not being assessees as defined under section 2(2) of the Black Money Act were not covered by the provisions of that Act and hence, could not have been assessed thereunder. Significantly, the notices under section 153A and 148 of the IT Act were also issued in respect of undisclosed foreign income/assets found during the course of the search and seizure operation conducted under section 132 of the IT Act. Thus, the search proceedings were conducted after the Black Money Act came Page 76 of 93 C/SCA/9883/2019 JUDGMENT into force and consequently, the notices under section 148 and 153A of the IT Act were also issued after the Black Money Act came into force. The fact that these notices under section 148 and 153A of the IT Act were issued in respect of undisclosed foreign income or asset is substantiated on a perusal of the reasons recorded for reopening the assessment for assessment year 2000-01, a copy whereof has been annexed along with the affidavit-in-reply of the respondent No.2 which shows that the assessment is sought to be reopened on the ground that the said assessee is found to have assets (including financial interest in entities) which are located outside India which have not been disclosed in his return. In the affidavit-in-reply, the said respondent has categorically averred that the reasons recorded for reopening the assessment for all the other years are also identical. Similar averments have been made by the respondents No.3 and 4 in the affidavits-in-reply filed by them. It, therefore, appears that the revenue authorities were well aware of the fact that the provisions of the Black Money Act covered the undisclosed foreign income only from assessment year 2016-17 onwards and, therefore, categorically submitted to the jurisdiction of the Settlement Commission and requested it to proceed further pursuant to the applications made by the contesting respondents under section 245C of the Income Tax Act, 1961. It is evident that it is only for this reason that notices under the Black Money Act were issued only for assessment years 2017- 18 and 2018-19. 39. At this juncture reference may be made to certain provisions of Chapter XIX-A of the IT Act. Section 245C of the IT Page 77 of 93 C/SCA/9883/2019 JUDGMENT Act makes provision for application for settlement of cases and provides that an assessee may, at any stage of a case relating to him, make an application in such form and in such manner as may be prescribed, and containing a full and true disclosure of his income which has not been disclosed before the Assessing Officer, the manner in which such income has been derived, the additional amount of income-tax payable on such income and such other particulars as may be prescribed, to the Settlement Commission to have the case settled and any such application shall be disposed of in the manner provided therein. Thus, under section 245C of the IT Act, an assessee can make an application at any stage of a case relating to him. 40. The expression “case” has been defined under clause (b) of section 245A of the IT Act to mean any proceeding for assessment under that Act, of any person in respect of any assessment year or assessment years which may be pending before an Assessing Officer on the date on which an application under sub-section (1) of section 245C is made. The Explanation thereto inter alia provides for the purposes of that clause- “(i) a proceeding for assessment or reassessment or re- computation under section 147 shall be deemed to have commenced- (a) from the date on which a notice under section 148 is issued for any assessment year; (b) from the date of issuance of the notice referred to in sub-clause (a), for any other assessment year or assessment years for which a notice under section 148 has not been issued, but such notice could have been issued on such date, if the return of income for the other assessment year or assessment years has been furnished under Page 78 of 93 C/SCA/9883/2019 JUDGMENT section 139 or in response to a notice under section 142; xxxxxx (iii-a) a proceeding for assessment or reassessment for any of the assessment years, referred to in clause (b) of sub-section (1) of section 153-A in case of a person referred to in section 153-A or section 153-C, shall be deemed to have commenced on the date of issue of notice initiating such proceedings and concluded on the date on which the assessment is made;” 41. In the facts of the present case, the Assessing Officer had issued notices under section 148 and section 153A of the IT Act for different assessment years. Therefore, proceedings for assessment or reassessment as contemplated under clauses (i) and (iiia) of the Explanation to clause (b) of section 245A had commenced and were pending before the Assessing Officer when the applications under section 245C of the IT Act came to be made. Therefore, the requirements of the provisions of section 245C of the IT Act were duly satisfied when the applications thereunder came to be made by the contesting respondents. Section 245D of the IT Act, provides for procedure on receipt of an application under section 245C thereof and reads as under: “245-D. Procedure on receipt of an application under Section 245-C.— (1) On receipt of an application under section 245-C, the Settlement Commission shall, within seven days from the date of receipt of the application, issue a notice to the applicant requiring him to explain as to why the application made by him be allowed to be proceeded with, and on hearing the applicant, the Settlement Commission shall, within a period of fourteen days from the date of the application, by an order in writing, reject the application or allow the application to be proceeded with: Page 79 of 93 C/SCA/9883/2019 JUDGMENT Provided that where no order has been passed within the aforesaid period by the Settlement Commission, the application shall be deemed to have been allowed to be proceeded with. (1-A) * * * (2) A copy of every order under sub-section (1) shall be sent to the applicant and to the Principal Commissioner or Commissioner. (2-A) Where an application was made under section 245-C before the 1st day of June, 2007, but an order under the provisions of sub-section (1) of this section, as they stood immediately before their amendment by the Finance Act, 2007, has not been made before the 1st day of June, 2007, such application shall be deemed to have been allowed to be proceeded with if the additional tax on the income disclosed in such application and the interest thereon is paid on or before the 31st day of July, 2007. Explanation.—In respect of the application referred to in this sub-section, the 31st day of July, 2007 shall be deemed to be the date of the order of rejection or allowing the application to be proceeded with under sub-section (1). (2-B) The Settlement Commission shall,— (i) in respect of an application which is allowed to be proceeded with under sub-section (1), within thirty days from the date on which the application was made; or (ii) in respect of an application referred to in sub- section (2-A) which is deemed to have been allowed to be proceeded with under that sub- section, on or before the 7th day of August, 2007, call for a report from the Principal Commissioner or Commissioner, and the Principal Commissioner or Commissioner shall furnish the report within a period of thirty days of the receipt of communication from the Settlement Commission. (2-C) Where a report of the Principal Commissioner or Commissioner called for under sub-section (2-B) has been furnished within the period specified therein, the Settlement Commission may, on the basis of the report and within a period of fifteen days of the receipt of the report, by an order in writing, declare the application in question as invalid, and shall send the copy of such Page 80 of 93 C/SCA/9883/2019 JUDGMENT order to the applicant and the Principal Commissioner or Commissioner: Provided that an application shall not be declared invalid unless an opportunity has been given to the applicant of being heard: Provided further that where the Principal Commissioner or Commissioner has not furnished the report within the aforesaid period, the Settlement Commission shall proceed further in the matter without the report of the Principal Commissioner or Commissioner. (2-D) Where an application was made under sub- section (1) of section 245-C before the 1st day of June, 2007 and an order under the provisions of sub-section (1) of this section, as they stood immediately before their amendment by the Finance Act, 2007, allowing the application to have been proceeded with, has been passed before the 1st day of June, 2007, but an order under the provisions of sub-section (4), as they stood immediately before their amendment by the Finance Act, 2007, was not passed before the 1st day of June, 2007, such application shall not be allowed to be further proceeded with unless the additional tax on the income disclosed in such application and the interest thereon, is, notwithstanding any extension of time already granted by the Settlement Commission, paid on or before the 31st day of July, 2007. (3) The Settlement Commission, in respect of— (i) an application which has not been declared invalid under sub-section (2-C); or (ii) an application referred to in sub-section (2-D) which has been allowed to be further proceeded with under that sub-section, may call for the records from the Principal Commissioner or Commissioner and after examination of such records, if the Settlement Commission is of the opinion that any further enquiry or investigation in the matter is necessary, it may direct the Principal Commissioner or Commissioner to make or cause to be made such further enquiry or investigation and furnish a report on the matters covered by the application and any other matter relating to the case, and the Principal Commissioner or Commissioner shall furnish the report within a period of ninety days of the receipt of communication from the Settlement Commission: Page 81 of 93 C/SCA/9883/2019 JUDGMENT Provided that where the Principal Commissioner or Commissioner does not furnish the report within the aforesaid period, the Settlement Commission may proceed to pass an order under sub-section (4) without such report. (4) After examination of the records and the report of the Principal Commissioner or Commissioner, if any, received under— (i) sub-section (2-B) or sub-section (3), or (ii) the provisions of sub-section (1) as they stood immediately before their amendment by the Finance Act, 2007, and after giving an opportunity to the applicant and to the Principal Commissioner or Commissioner to be heard, either in person or through a representative duly authorised in this behalf, and after examining such further evidence as may be placed before it or obtained by it, the Settlement Commission may, in accordance with the provisions of this Act, pass such order as it thinks fit on the matters covered by the application and any other matter relating to the case not covered by the application, but referred to in the report of the Principal Commissioner or Commissioner. (4-A) The Settlement Commission shall pass an order under sub-section (4)— (i) in respect of an application referred to in sub- section (2-A) or sub-section (2-D), on or before the 31st day of March, 2008; (ii) in respect of an application made on or after the 1st day of June, 2007 but before the 1st day of June, 2010, within twelve months from the end of the month in which the application was made. [(iii) in respect of an application made on or after the 1st day of June, 2010, within eighteen months from the end of the month in which the application was made. (5) Subject to the provisions of Section 245-BA, the materials brought on record before the Settlement Commission shall be considered by the Members of the Bench concerned before passing any order under sub- section (4) and, in relation to the passing of such order, the provisions of Section 245-BD shall apply. (6) Every order passed under sub-section (4) shall provide for the terms of settlement including any Page 82 of 93 C/SCA/9883/2019 JUDGMENT demand by way of tax, penalty or interest the manner in which any sum due under the settlement shall be paid and all other matters to make the settlement effective and shall also provide that the settlement shall be void if it is subsequently found by the Settlement Commission that it has been obtained by fraud or misrepresentation of facts. (6-A) Where any tax payable in pursuance of an order under sub-section (4) is not paid by the assessee within thirty-five days of the receipt of a copy of the order by him, then whether or not the Settlement Commission has extended the time for payment of such tax or has allowed payment thereof by instalments, the assessee shall be liable to pay simple interest at one and one-fourth per cent for every month or part of a month] on the amount remaining unpaid from the date of expiry of the period of thirty-five days aforesaid. (6-B) The Settlement Commission may, with a view to rectifying any mistake apparent from the record, amend any order passed by it under sub-section (4)— (a) at any time within a period of six months from the end of the month in which the order was passed; or (b) at any time within the period of six months from the end of the month in which an application for rectification has been made by the Principal Commissioner or the Commissioner or the applicant, as the case may be: Provided that no application for rectification shall be made by the Principal Commissioner or the Commissioner or the applicant after the expiry of six months from the end of the month in which an order under sub-section (4) is passed by the Settlement Commission: Provided further that an amendment which has the effect of modifying the liability of the applicant shall not be made under this sub-section unless the Settlement Commission has given notice to the applicant and the Principal Commissioner or Commissioner of its intention to do so and has allowed the applicant and the Principal Commissioner or Commissioner an opportunity of being heard. (7) Where a settlement becomes void as provided under sub-section (6), the proceedings with respect to Page 83 of 93 C/SCA/9883/2019 JUDGMENT the matters covered by the settlement shall be deemed to have been revived from the stage at which the application was allowed to be proceeded with by the Settlement Commission and the income tax authority concerned, may, notwithstanding anything contained in any other provision of this Act, complete such proceedings at any time before the expiry of two years from the end of the financial year in which the settlement became void. (8) For the removal of doubts, it is hereby declared that nothing contained in section 153 shall apply to any order passed under sub-section (4) or to any order of assessment, reassessment or recomputation required to be made by the Assessing Officer in pursuance of any directions contained in such order passed by the Settlement Commission and nothing contained in the proviso to sub-section (1) of section 186 shall apply to the pursuance of any such directions as aforesaid.” 42. In the present case, upon receipt of the application made under section 245C of the IT Act, the Settlement Commission has proceeded further in accordance with the provisions of section 245D of the IT Act. At the stage when it was brought to its notice that notices under section 10 of the Black Money Act had been issued to the contesting respondents, the Settlement Commission gave ample opportunity to the revenue to decide as to what course of action it wants to adopt, and it was the revenue which categorically invited an order from the Settlement Commission in respect of the undisclosed foreign income and assets disclosed before it. From the submissions advanced on behalf of the petitioner, nothing has been pointed out to show that the Settlement Commission has not followed any provision of law. The record of the case shows that the requirements of section 245D of the IT Act have been duly satisfied prior to the passing of the impugned order under section 245D(4) of the IT Act. Therefore, there is no infirmity or illegality in the approach adopted by the Settlement Page 84 of 93 C/SCA/9883/2019 JUDGMENT Commission, which has merely decided applications made under section 245C of the IT Act in accordance with law. As held by the Supreme Court in catena of decisions, an order of the Settlement Commission can be interfered with only if such order is found to be contrary to any provisions of the IT Act. 43. Besides, the petitioner cannot be permitted to approbate and reprobate at the same time, namely before the Settlement Commission to take a stand that the undisclosed foreign income and assets are governed by the provisions of the Income Tax Act, 1961 for the relevant years in respect of which the proceedings were pending before the Settlement Commission, and now to take a somersault and say that the Settlement Commission had no jurisdiction to decide the applications under section 245C of the IT Act. 44. Another aspect of the matter is that the proceedings before the Settlement Commission were taken in connection with notices issued under section 148 and 153A of the Income Tax Act, and it is therefore, that the Settlement Commission had the jurisdiction to decide the applications under section 245C of that Act, which related to the proceedings in respect of those notices. If it was the case of the revenue that the undisclosed foreign income and asset of the contesting respondents were covered by the provisions of the Black Money Act, the notices under section 148 and 153A of the IT Act, which mainly related to undisclosed foreign income, ought to have been withdrawn and proceedings ought to have been initiated under the relevant provisions of the Black Money Act. However, it seems that since the notices under section 148 Page 85 of 93 C/SCA/9883/2019 JUDGMENT and 153A of the IT Act related to undisclosed foreign income of periods not covered by the Black Money Act, such notices were not withdrawn and a conscious decision was taken to pursue the settlement proceedings. If that be so, it was always permissible for the assessees, namely the contesting respondents, to opt for settlement under Chapter XIX A of the IT Act and the Settlement Commission had the jurisdiction to decide the applications under section 245C of the IT Act in respect of the income disclosed therein. 45. Moreover, for the reasons set out hereinabove, even on a consideration of the provisions of the Black Money Act, this court finds that the Settlement Commission did not lack the jurisdiction to decide the applications under section 245C of the IT Act. In the light of the above discussion, the contention advanced on behalf of the petitioner that the Settlement Commission did not have the jurisdiction to decide the applications under section 245D of the Income Tax Act, 1961 does not merit acceptance. 46. The impugned order passed by the Settlement Commission has also been challenged on the ground that the contesting respondents did not make full and true disclosure of their foreign income and assets. It is the case of the petitioner that during the pendency of the proceedings before the Settlement Commission, the contesting respondents had revised the declaration of undisclosed income and hence, in the light of the principles enunciated by the Supreme Court in Ajmera Housing Corporation and another (supra), it cannot be said that the pre-requisites for a valid application Page 86 of 93 C/SCA/9883/2019 JUDGMENT under section 245C (1) of the IT Act, are satisfied. Therefore, the Settlement Commission was not justified in deciding the applications under section 245C of the IT Act made by the contesting respondents under section 245D (4) thereof. 47. In this regard, a perusal of the impugned order reveals that the Settlement Commission has recorded satisfaction that there has been no willful attempt to conceal material facts in these cases. The Settlement Commission further noted that in the course of hearings under sections 245D(4)/245D(3), the PCIT verified entries, as directed by the it, in the bank statements/ portfolio statements, ledger accounts, entries in the Tally database and all other evidences submitted by the applicants in different paper books and income statements of the applicants. The sources of individual credit entries were also verified by the PCIT. The verification reports of the PCIT are narrated in the earlier part of the order of the Settlement Commission. The Settlement Commission recorded that on some of the issues, which remained unreconciled due to the fact that they pertained to very old periods and for want of further evidence, the applicants in true spirit of settlement and for bringing quietus to the issues have offered additional income vide detailed submissions filed on 17.12.2018. The Settlement Commission recorded that the applicants had made the additional offer of Rs.8,65,63,679/- in respect of the following issues:- “a. Irregularities in the opening stock of 7.5% HSBC Bank Plc Bond of US $ 10,86,457. b. HSBC Bank account balance of HKD 9,20,400 as on 10.10.2005. c. Barclays Bank accounts held in the name of the Page 87 of 93 C/SCA/9883/2019 JUDGMENT Applicant bearing account no.204490 and account no.204507 having aggregate balance of GBP 2,46,263 d. Interest income of Eur 26,550 as per Applicant’s letter dated 08.10.2018 determined on account of reconciliation of Code 39 and Code 40 and e. Income offered to cover up insufficient personal and household expenses for the period covered by the settlement application filed by the Applicants as above. f. Income of Marias Trust being treated as AOP and separately assessable as such for the period covered by the present applications offered in the hands of the applicants equally to buy peace and to avoid multiplicity of the proceeding.” 48. The Settlement Commission recorded that taking into account all the facts and discussions on record, it could be concluded that the further additional income offered during 245D(4) proceedings totaling Rs.8,65,63,679/- along with the additional income offered in the SOFs amounting to Rs.90,28,25,000/- can be accepted with reference to incomes disclosed in the settlement applications. 49. Thus, the Settlement Commission, after considering the material on record, has given a finding of fact to the effect that there is a full and true disclosure made by the respondents and that there is no willful attempt to conceal material facts. Nonetheless, it is true that the contesting respondents had agreed to pay an additional amount of Rs.8,65,63,679/- during the course of the settlement proceedings, which is termed as a revised disclosure by the petitioner. In the opinion of this court, such contention on the part of the petitioner is misconceived for the reason that while the disclosures are full and true, there is a difference in the computation of tax liability made by the department and by the contesting respondents based on such disclosures. Since the issues raised by the revenue could not Page 88 of 93 C/SCA/9883/2019 JUDGMENT be reconciled as they pertained to very old periods and for want of further evidence, with a view to buy peace, the contesting respondents have agreed to pay the additional amount as computed by the petitioner. It is also required to be kept in mind that the contesting respondents offered additional income of Rs.129,09,82,999/- as part of the settlement application, which included the amount of Rs.38,81,57,999/- offered in the returns filed in response to the notices under sections 148 and 153A of the IT Act. As compared to the amount of income disclosed, the additional amount offered was only Rs.8.64 crores which comes to approximately 6.7% of the total amount of income disclosed and is, therefore, only a fraction of the total income disclosed. Moreover, this offer to pay additional amount by the contesting respondents has to be considered keeping in mind the fact that the proceedings before the Settlement Commission are in the nature of settlement proceedings. If for the reason that in respect of issues which pertained to very old period and could not be reconciled due to lack of want of further evidence, the contesting respondents, with a view to bring about a settlement, agreed to pay a higher amount as proposed by the revenue, it certainly cannot be termed as a revision of the original disclosure made under section 245C of the IT Act, inasmuch as, there is no further disclosure but an acceptance of additional liability based on the disclosure already made before the Settlement Commission. 50. In the above backdrop, the decision of the Supreme Court in the case of Ajmera Housing Corporation v. Commissioner of Income-tax (supra), on which reliance has been placed by the learned counsel for the petitioner would, in Page 89 of 93 C/SCA/9883/2019 JUDGMENT the opinion of this court, have no applicability to the facts of the present case, inasmuch as, in the facts of the said case, the assessee had filed application under section 245C before the Settlement Commission disclosing an amount of Rs.1,94,33,580/- for the relevant assessment year in addition to the income declared in the return of income submitted by them earlier. During the course of the proceedings before the Settlement Commission, the assessee filed a revised settlement application containing confidential annexures and related papers declaring therein an additional income of Rs.11.41 crore. Thus, while in the application under section 245C(1) of the IT Act, the disclosure was of Rs.1.94 crores, in the revision application the additional income of Rs.11.41 crore, which was approximately five times the amount originally disclosed, came to be made. Besides, in that case, a revised settlement application had been made and it is in the backdrop of such facts and circumstances that the Supreme Court held that full and true disclosure of income which had not been previously disclosed by the assessee being a pre- condition for a valid application under section 245C(1) of the Act. The scheme of Chapter XIXA does not contemplate revision of income so disclosed in the application against item 11 for the form. The court further held that if an assessee is permitted to revise his disclosure, in essence, he would be making a fresh application in relation to the same case by withdrawing the earlier application and that in this regard, section 245C(3) of the Act which prohibits the withdrawal of an application once made under sub-section (1) of the said section is instructive inasmuch as it manifests that an assessee cannot be permitted to resile from his stand at any stage during the proceedings. Page 90 of 93 C/SCA/9883/2019 JUDGMENT 51. Adverting to the facts of the present case, as noticed earlier, the contesting respondents have not resiled from their stand in the application made under section 245C of the IT Act. The contesting respondents have also not made any further disclosure during the course of settlement proceedings but have only agreed to pay additional tax on the basis of the computation made by the revenue in respect of the disclosure made by them. 52. The Supreme Court in Union of India v. Ind-Swift Laboratories Ltd. (supra) has held thus: “22. An order passed by the Settlement Commission could be interfered with only if the said order is found to be contrary to any provisions of the Act. So far as the findings of fact recorded by the Commission or question of facts are concerned, the same is not open for examination either by the High Court or by the Supreme Court. In the present case the order of the Settlement Commission clearly indicates that the said order, particularly, with regard to the imposition of simple interest @ 10% per annum was passed in accordance with the provisions of Rule 14 but the High Court wrongly interpreted the said Rule and thereby arrived at an erroneous finding. So far as the second issue with respect to interest on Rs. 50 lakhs is concerned, the same being a factual issue should not have been gone into by the High Court exercising the writ jurisdiction and the High Court should not have substituted its own opinion against the opinion of the Settlement Commission when the same was not challenged on merits.” 53. In the present case, it is not possible to state that the impugned order passed by the Settlement Commission is in any manner contrary to any provisions of the IT Act. Insofar as the findings of fact recorded by the Settlement Commission to Page 91 of 93 C/SCA/9883/2019 JUDGMENT the effect that there has been no wilful attempt to conceal material facts in these cases are concerned, the same cannot be gone into by this court while exercising writ jurisdiction in absence of any challenge to such findings on the ground of perversity. Under the circumstances, there is no warrant for exercise of powers under articles 226 or 227 of the Constitution of India. 54. Another aspect of the matter is that it is an admitted position that prior to the presentation of this petition, the order of the Settlement Commission came to be fully implemented. Though the Settlement Commission had granted one year’s time to pay the amount determined by it, after the order of the Settlement Commission was given effect to, the revenue authorities issued notices of demand and recovered the same from the contesting respondents. At the time when the petition came to be filed, the order of the Settlement Commission has been fully implemented. However, there is not even a whisper in this regard in the memorandum of petition. Not only that, despite having fully executed the impugned order, by way of interim relief it has been prayed that the execution and operation of the order dated 30.1.2019 passed by the Settlement Commission under section 245D of the IT Act be stayed. The learned counsel for the contesting respondents is, therefore, wholly justified in contending that the petition suffers from suppression of material facts. 55. In the light of the above discussion, this court does not find any infirmity in the impugned order passed by the Settlement Commission so as to warrant interference. The Page 92 of 93 C/SCA/9883/2019 JUDGMENT petition, therefore, fails and is, accordingly, dismissed. Notice is discharged with no order as to costs. The interim relief granted earlier stands vacated. 56. At this stage, the learned advocate for the petitioner has requested that the operation of this judgment be stayed for a period of two weeks so as to enable the petitioner to approach the higher forum. 57. Having regard to the fact that what is subject matter of challenge in this petition is an order of the Settlement Commission, which has already been fully executed by the petitioner, staying this judgment would not serve any purpose. The request is therefore not accepted. (HARSHA DEVANI, J) (SANGEETA K. VISHEN,J) Z.G. SHAIKH Page 93 of 93 "