⚖️Case Study: Assistant Commissioner of Income Tax & Another v. Omaxe Limited
📑Case No. : CIVIL APPEAL NO. 9190 OF 2013
📋Neutral Citation: 2026 INSC 1000
📅Decided on: 16.09.2026
📌 Factual Background
- Assessee: Omaxe Ltd., a public limited real estate company.
- Return Filed: AY 2006‑07, declaring ₹89.20 crore taxable income and claiming deduction of ₹78.99 crore under Section 80IB(10).
- Settlement Commission: Application filed under Section 245C; ITSC passed final order on 17.03.2008, accepting additional income of ₹18 lakh and determining net taxable income at ₹89.38 crore.
- Revenue Action: Fresh survey (Dec 2009) revealed alleged manipulation of commercial areas in housing projects (Lucknow, Sonepat, Faridabad). AO issued Notice under Section 148 (30.06.2010) and reassessment order (08.11.2011), disallowing deduction and adding ₹65.65 crore.
- High Court: Quashed reassessment, holding ITSC’s order conclusive.
- Appeal: Revenue challenged before Supreme Court.
⚖️ Legal Issues
- Whether AO can reopen assessment under Sections 147/148 after ITSC has passed a final order under Section 245D(4).
- Whether deduction under Section 80IB(10) was outside ITSC’s scope, permitting reassessment.
- Scope of Section 245‑I (finality of Settlement Commission orders) vis‑à‑vis AO’s jurisdiction.
🗣️ Contentions of Parties
- Revenue:
- ITSC order covered only disclosed income, not deductions under Section 80IB(10).
- AO had jurisdiction to reassess escaped income.
- Relied on CIT v. Damani Brothers (2003) 259 ITR 475 (SC).
- Assessee (Omaxe):
- ITSC order was conclusive under Section 245‑I.
- AO lacked jurisdiction; remedy for Revenue was only under Section 245D(6) (fraud/misrepresentation).
- Relied on Jyotendrasinhji v. S.I. Tripathi (1993 Supp (3) SCC 389), CIT v. Express Newspapers Ltd. (1994) 2 SCC 374, Brij Lal v. CIT (2011) 1 SCC 1, Kotak Mahindra Bank Ltd. v. CIT (2023) 458 ITR 113 (SC).
📚 Case Laws Discussed
- CIT v. Damani Brothers (2003) 259 ITR 475 (SC) – ITSC’s role limited at preliminary stage.
- Major Metals Ltd. (Bom HC, W.P. 397/2011) – ITSC has exclusive jurisdiction once seized.
- CIT v. Smt. Diksha Singh [2013] 350 ITR 157 (All HC) – AO cannot parallelly reassess settled matters.
- Brij Lal v. CIT (2011) 1 SCC 1 – Chapter XIX‑A is a self‑contained code.
- Kotak Mahindra Bank Ltd. v. CIT (2023) 458 ITR 113 (SC).
👩⚖️ Observations of Supreme Court
- ITSC’s jurisdiction under Section 245F(2) is exclusive once application is admitted.
- Finality under Section 245‑I bars reopening by AO; only ITSC can revisit its order if obtained by fraud/misrepresentation.
- Reassessment under Section 147 cannot override ITSC’s final order.
- High Court rightly quashed AO’s reassessment notice and order.
- Reiterated that two parallel authorities cannot determine income for the same AY; it would cause chaos in tax administration.
✅ Conclusion
The Supreme Court upheld the High Court’s decision:
- AO has no jurisdiction to reopen matters settled by ITSC.
- Revenue’s remedy lies only under Section 245D(6), not reassessment.
- Ensures certainty and finality in settlement proceedings.
🔑 Key Takeaways
- ITSC orders under Section 245D(4) attain statutory finality; AO cannot reopen.
- Parallel jurisdiction between AO and ITSC is impermissible.
- Fraud/misrepresentation challenges must be raised before ITSC itself.
- Reinforces ITSC as a self‑contained code ensuring comprehensive settlement.
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📌 Official Copy of judgement 👇