The Case
ASST. COMMISSIOER OF INCOME TAX . VS OMAXE LTD.
Case No.: C.A. No.-009190-009190 – 2013
Decided on: 09/16/2026
Diary No.: 1751/2013 ·
Supreme Court of India
The Legal Issue Before the Supreme Court
The question is whether, notwithstanding an Order under Section 245D(4) of the Income Tax Act, 1961, the Assessing Officer has jurisdiction under Section 148 to propose reassessment of an aspect covered by the Settlement Order. The Court considered whether the final Settlement Order of the Income Tax Settlement Commission bars the AO from initiating reassessment proceedings in respect of the Section 80IB(10) deduction.
Facts of the Case
The Assessee, a public limited company engaged in real estate, filed its return for AY 2006-07 declaring taxable income of Rs.89,20,76,630/- and claimed a deduction under Section 80IB(10). On 17.03.2008, the ITSC passed a final Settlement Order under Section 245D(4) for AY 2006-07 accepting additional income surrender of Rs.18,00,000 and determining net taxable income of Rs.89,38,76,630/-. Subsequently, a survey under Section 133A led to a notice under Section 148 dated 30.06.2010 proposing to disallow the Section 80IB(10) deduction to the extent of Rs.55,58,96,486/-. The AO rejected the Assessee’s objections and passed a reassessment order dated 08.11.2011 disallowing the deduction and adding Rs.65,65,17,999/- to the total income. The High Court quashed the notice and reassessment order, leading to the Revenue’s appeal.
Summary of the Decision
The Supreme Court dismissed the Revenue’s appeal, finding no merit in it. The Court held that once the ITSC admits a settlement application, it assumes exclusive jurisdiction under Section 245F(2), and the regular assessment machinery is placed in statutory abeyance. Under Section 245-I, the ITSC’s final Settlement Order is conclusive, and the Assessing Officer has no jurisdiction under Section 148 to reopen an aspect covered by that Order. The Court observed that the Revenue’s remedy lies only under Section 245D(6) on grounds of fraud or misrepresentation, which was invoked but rejected by the ITSC on 16.12.2011, and that order has become final. The Court emphasized that the AO’s power to reassess a Settlement Order passed by the ITSC is unavailable, as otherwise the finality attached to the Settlement Commission would be defeated. The appeal was dismissed accordingly.
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