UNION OF INDIA vs. ADDITIONAL BENCH IT SETTLEMENT COMMISSION, KOLKATTA

CGHC010154042019

2026:CGHC:29918

NAFR HIGH COURT OF CHHATTISGARH AT BILASPUR WPT No. 89 of 2019 1 - Union Of India Through The Secretary, Ministry Of Finance, Department Of Revenue, North Block, New Delhi., District : New Delhi, Delhi 2 - Director General Of Income Tax (Investigation) Aayakar Bhawan, Hoshangabad Road, Bhopal Madhya Pradesh., District : Bhopal, Madhya

Pradesh 3 - Chief Commissioner Of Income Tax -1 Raipur Central Revenue Building, Civil Lines, Raipur Chhattisgarh., District : Raipur, Chhattisgarh 4 - Principal Commissioner Of Income Tax-1 Raipur Central Revenue Building, Civil Lines, Raipur Chhattisgarh., District : Raipur, Chhattisgarh 5 - Commissioner Of Income Tax (Dr) 10b, Middleton Row, Kolkata 700071,

District

Kolkata,

West

Bengal 6 - Assistant Commissioner Of Income- Tax Circle- 2(1) Central Revenue Building, Civil Lines, Raipur Chhattisgarh., District : Raipur, Chhattisgarh

... Petitioner(s) versus 1 - Additional Bench It Settlement Commission, Kolkatta 10c, Middleton Row, Kolkata -700071, District : Kolkata, West Bengal 2 - Prime Ispat Ltd., A Company Registered Under The Provisions Of The Indian Companies Act, 1956 Regd. Address Pyare Lal Agrawal Marg, Ramsagar Para, Raipur Chhattisgarh Through The Managing

2 Director.,

District

Raipur,

Chhattisgarh 3 - Ashok Kumar Agrawal S/o Shri R K Agrawal R/o Pyare Lal Agrawal Marg, Ramsagar Para, Raipur Chhattisgarh., District : Raipur, Chhattisgarh 4 - Pawan Kumar Agrawal S/o Shri R K Agrawal R/o Pyare Lal Agrawal Marg, Ramsagar Para, Raipur Chhattisgarh., District : Raipur, Chhattisgarh 5 - Smt. Mamta Agrawal W/o Shri Ashok Agrawal R/o Pyare Lal Agrawal Marg, Ramsagar Para, Raipur Chhattisgarh., District : Raipur, Chhattisgarh 6 - Smt. Madhu Agrawal W/o Shri Pawan Kumar Agrawal R/o Pyare Lal Agrawal Marg, Ramsagar Para, Raipur Chhattisgarh...(Res. No.3 To 6 Are Directors Of Prime Ispat Ltd.), District : Raipur, Chhattisgarh

... Respondent(s) For Petitioners : Mr. Ajay Kumarani, Advocate For Respondents No. 2 to 6 : Mr. Abhimanyu Bhandari, Senior Advocate appearing through video-conferencing assisted by Mr. Krishna Tandon, Advocate Hon’ble Shri Justice Rakesh Mohan Pandey Judgment On Board 15.7.2026 1) By way of this petition, the petitioners have sought following reliefs:- 10.1 That this Hon'ble Court may kindly be pleased to Call for the entire records concerning the case of the petitioner for its kind perusal. 10.2 That, this Hon'ble Court may kindly be pleased to issue an appropriate writ/order/direction and quashing the final order u/s 245D (4) of the Act dated 31/10/2012 by the Settlement Commission, Kolkata (Annexure P/1). 10.3 That, this Hon'ble Court may kindly be pleased

3 to issue an appropriate writ/order/direction and quashing the order u/s 245D (6) of the Act dated 03/02/2017 by the Settlement Commission. Kolkata (Annexure P/2). 10.4 That, this Hon'ble Court may kindly be pleased to issue an appropriate writ/order/direction and initiate and take action against the respondent under section 2(C) of the Contempt of Courts Act, 1971 causing interference in the judicial proceedings by filling deliberate false distorted statement. 10.5 That, this Hon'ble Court may kindly be pleased to issue an _appropriate writ/order/direction and in the alternative, initiate action under section 340 of the Cr. P.C. in the interest of justice, causing an investigation into the deliberate false statements made by the Respondent in their common affidavit/ at the time of filing of the writ before the Hon'ble High Court and also deliberate failure to disclose the (writ) Supra/before the Settlement Commission and obtaining a favorable orders. 10.6 Any other relief which this Hon'ble Court deems fit may also be granted. 2) Facts of present case are that in the year 2007, during the course of a search conducted by Income Tax Department at premises of Ashok Nanda, certain materials incriminating respondents No. 2 to 6 were gathered. On 21.10.2008, a search was conducted in Cosmos Ispat Group Ltd., which led to recovery of a suitcase from the residence of Anand Kumar Agrawal who is the brother in law of Babulal Agrawal. The suitcase contained documents showing investments exceeding Rs. 30 crores in the names of Babulal Agrawal and his family members. Between 4.2.2010 to 6.2.2010, Directorate of Income Tax (Investigation), Bhopal conducted

4 search and seizure operation under Section 132 of Income Tax Act and statements under Section 132 (4) were also recorded. On 19.2.2010, Economic Offences Wing/ Anti-Corruption Wing, Chhattisgarh registered FIR against Babulal Agrawal under Sections 13 (1)(e) and 13 (2) of Prevention of Corruption Act, 1988 for possession of assets disproportionate to his known sources of income. 3) On 10.1.2011, Directorate of Enforcement (ED) registered ECIR No. -ECIR/01/NGR/2011 under the Prevention of Money Laundering Act, 2002 against Babulal Agrawal and others. On 10.2.2011, notices under Section 153A of Income Tax Act were issued to the members of Agrawal Group, initiating assessment proceedings. On 30.8.2011, six assesses belonging to Agrawal Group filed applications under Section 245C(1) of Income Tax Act before the Additional Bench of Income Tax Settlement Commission, Kolkata [hereinafter to referred as ‘Settlement Commission’ ] seeking settlement of their cases. On 2.9.2011, five of the applicants preferred WPT No. 5345 of 2011 before High Court of Chhattisgarh challenging the very search and seizure proceeding. On 12.9.2011, Settlement Commission admitted the settlement applications and on 31.10.2012, the Commission finally passed a composite order under Section 245D(4) of Income Tax Act settling the cases of the applicants. Thereafter, WPT No. 5345 of 2011 was also withdrawn on 30.1.2014. Subsequently, the department moved an application for rectification on 20.12.2016

5 under Section 245D(6) before the Settlement Commission and same was rejected vide order dated 3.2.2017. 4) Learned counsel appearing for the petitioners submits that respondents No. 2 to 6 approached the Settlement Commission challenging the search and seizure proceeding by filing applications under Section 245(D)(1) of Income Tax Act and at the same time, five members of Agrawal Group preferred WPT No. 5345 of 2011 assailing the very same proceeding. He further submits that respondents No. 2 to 6 suppressed material facts before the Settlement Commission therefore order passed on 31.10.2012 would amount to outcome of fraud and misrepresentation. He also submits that application for rectification was moved by the petitioner-department for rectification but the Settlement Commission failed to consider the grounds raised therein. He prays to allow this writ petition. 5) On the other hand, learned Senior counsel appearing for the respondents No. 2 to 6 submits that initially, the composite order was passed by the Settlement Commission on 31.10.2012 and it was within the knowledge of petitioner-department and no steps were taken by them to avoid the very order but the petitioners approached the Settlement Commission for rectification after period of five years and their application was dismissed vide order dated 3.2.2017. He further submits that petitioner-department preferred this writ petition on 30.4.2019 i.e. after seven years from

6 the date of passing of the composite order and after two years from the date of passing of the subsequent order dated 3.2.2017. He also submits that petitioners failed to explain the cause of delay in para-7 of writ petition therefore this petition deserves to be dismissed. 6) I have heard learned counsel for the parties and perused the material available on record. 7) Admittedly, respondents No. 2 to 6 approached the Settlement Commission on 30.8.2011 seeking settlement of their cases arising from the search and seizure proceeding. Five members of the Agrawal Group approached High Court of Chhattisgarh by filing WPT No. 5345 of 2011 wherein similar relief was sought. However, in the order passed by the Settlement Commission dated 3.2.2017, it is stated that the subject matters of both the proceedings are different. 8) Pertinently, the order dated 31.10.2012 was passed in presence of both the parties therefore it cannot be presumed that petitioners were not aware of the outcome of the applications moved by the respondents No. 2 to 6 before the Settlement Commission. They took five years to move application for rectification and ultimately, said application was also rejected. 9) In para-7, it is stated that there is no delay in approaching this Court but the order dated 31.10.2012 has been challenged after seven years whereas the order dated 3.2.2017 has been

7 challenged after two years. Thus, in opinion of this Court, petitioners herein failed to explain the delay properly. 10) Taking into consideration the reasons assigned by the Settlement Commission in its order dated 3.2.2017 and the facts discussed above, I do not find any good ground to interfere with the orders impugned. Consequently, this writ petition fails and is hereby dismissed. 11) No order as to cost(s). Sd/- (Rakesh Mohan Pandey) JUDGE A j i n k y a Digitally signed by AJINKYA PANSARE Date: 2026.07.16 14:07:54 +0530