ANBUCHEZHIAN Vs. INCOME TAX SETTLEMENT COMMISSION

JUDGEMENT

(1.) The petitioner has filed this writ petition challenging the order passed by the Income Tax Settlement Commission (hereinafter referred to as "the Settlement Commission"), Additional Bench, Chennai, dated 05.01.2018, passed under Section 245D(1) of the Income Tax Act, 1961 (hereinafter referred to as "the Act"). By the impugned order, the petitioner's application for settlement of his case was rejected on the ground that he failed to make full and true disclosure and also the manner of earning such income, which are the requisite conditions laid down in Section 245C(1) of the Act. As the petitioner has not satisfied the conditions laid down in the said provision, the application filed by the petitioner dated 26.12.2017, for the assessment years 2010-11 to 2016-17 was not allowed to be admitted under Section 245D(1) of the Act. The application dated 26.12.2017, was the second application filed by the petitioner for settlement of his case. The first application was made on 28.07.2017, which was rejected by order dated 10.08.2017, under Section 245D(1) of the Act. The following facts would be necessary for considering as to what relief the petitioner is entitled to in this writ petition.

(2.) The petitioner is an individual carrying on business of distribution of films produced by third parties primarily in the area of Madurai - Ramnad Districts and occasionally in other districts and he is an assessee on the file of the second respondent, the Assistant Commissioner of Income Tax, Central Circle 2(2), Chennai.

(3.) According to the petitioner, his line of business was to ensure the smooth running of his film distribution business, for which purpose, he had opened multiple Bank accounts in various Banks in the names of different persons/entities to ensure timely realizations and also for the sake of his convenience. The advances made by the petitioner to the film Producers and others in connection with the distribution business are routed through Bank accounts by way of RTGS/Cheques and also from cash withdrawals. In case of distribution basis, the movies are released for and on behalf of the Producers generally in Madurai Ramnad area and for having done this the petitioner charges a share of profit of the film out of the net share of the Producer, normally in the range of 2% to 10%. That apart, films are also released on minimum guarantee basis, where an initial sum is paid to the Producer by the distributor irrespective of how the film performs.