Section 245C of the Income Tax Act
The decision most relied on for Section 245C is 456 (SC) 2. CIT v. Neha Builders (P) LTD. (4 Taxmann 183), cited in 21 of the 132 judgments on BharatTax that turn on this section.
Leading authorities on Section 245C
The Settlement Commission can use material produced by the assessee or evidence recorded during its proceedings against the assessee, provided there is incriminating material. If no such evidence is found for a disclosed amount, an addition cannot be made based on that disclosure.
An addition to income cannot be made solely on the basis of income offered by an assessee before the Settlement Commission if there is no incriminating material. Information provided to the Settlement Commission, even if admitted under section 245D, can only be used for settlement purposes and not for other proceedings.
Confidential information disclosed to the Settlement Commission cannot be used by the Assessing Officer to make additions if the settlement application is not admitted under section 245D(1).
Forms provided by a rule-making authority, being delegates of the legislature, cannot override a statutory provision and are subservient to legislation. Forms facilitate implementation and cannot supplant the law. Also, interest under section 234B, being compensatory, cannot be charged if taxes have already been paid.
Additions made under section 153A of the Income Tax Act, 1961, are invalid if assessments for the relevant years had already attained finality and no incriminating material was found during the search.
