RAKESH KUMAR AGGARWAL Vs. INCOME TAX SETTLEMENT COMMISSION

JUDGEMENT

(1.) THIS is a writ petition questioning correctness of the order passed by the Income-tax Settlement Commission (in short the "Commission") under section 245D(4) of the IT Act, 1961 (in short the "Act").

(2.) THE background facts reveal this case has a chequered history and the starting point of the controversy seems to be the search and seizure operation conducted at the residential and business premises of Rakesh Kumar Agarwal, the petitioner, on 27th April, 1989. Certain books of accounts, documents, cash, jewellery, bank accounts, fixed deposit receipts, pay orders, inter alia, were seized/restrained. It surfaced during the investigation that though certain assessments were done in the case of one Mr. S.K. Aggarwal, he was non-existent. The present dispute revolves round pay orders worth Rs. 50,40,000 purchased in the name of M/s Hindustan Copper Ltd. (hereinafter referred to as the 'HCL"). Lot of controversies seem to be attached on the question, whether they related to one M/s Bansal Commodities. Different stands appear to be taken at different points of time, as regards the payability of any sum to M/s Bansal Commodities. Learned counsel for the petitioner accepts the position that aforesaid S.K. Aggarwal was non-existent and whatever transactions were done in the name of S.K. Aggarwal really related to the petitioner. The pay orders were in the possession of M/s Bansal Commodities. Petitioner moved the Commission praying that his income may be determined on year to year basis and connected issues like chargeability of interest, etc. may also be determined. In the application for settlement, prayer inter alia was as follows :

(3.) THE whole case is shrouded in mystery, in a maze of factual controversies, and Department's role in creating a confused situation is writ large. The stands of contesting claimants have no visible consistency. It is borne out from records that after the order under S. 132(11) was passed, a report was submitted to the Commission by the Commissioner, which contained somewhat different conclusions from those contained in the order under S. 132(11). It is not clear from the order passed by the Commission as to whether the order under S. 132(11), dt. 4th June, 1992, was brought to its notice. Had that been so the least the Commission was required to do was to record as to how the said order was not correct and as to under what circumstances it held that the deemed seizure was illegal. Additionally, materials on record reveal that there is in fact a dispute between the Department and the petitioner on the issue that Rs. 50,40,000 actually belongs to M/s Bansal Commodities, Petitioner, at different stages, has been raising dispute about the amount in respect of which the pay order was in the possession of M/s Bansal Commodities.