In a significant judgement, the Supreme Court has said that the full and true disclosure of undisclosed income and their manner of acquisitions is mandatory for the settlement of the cases and grant of immunity from criminal prosecution.
The Income Tax Settlement Commission, even after commencing the proceedings, is empowered to examine the authenticity of such full and true disclosure of the unaccounted return of the assessees, said the apex court dismissing the plea of real estate major Ajmera Housing Corporation and others.
The court said, “disclosure of ‘full and true’ particulars of undisclosed income and ‘the manner’ in which such income had been derived are the pre-requisites for a valid application under section 245C(1) of the act. Additionally, the amount of income tax payable on such undisclosed income is to be computed and mentioned in the application”.
Section 245C(1) of the act mandates ‘full and true’ disclosure of the particulars of undisclosed income and ‘the manner’ in which such income was derived and, therefore, unless the Settlement Commission records its satisfaction on this aspect, it will not have the jurisdiction to pass any order on the matter covered by the application, court pointed out.
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