ABHAY KUMAR GODHA SON OF SHRI CHIRANJI LAL GODHA vs ASSISTANT COMMISSIONER OF INCOME TAX

[2026:RJ-JP:45944-DB]
REPORTABLE
HIGH COURT OF JUDICATURE FOR RAJASTHAN
BENCH AT JAIPUR
D.B. Civil Writ Petition No. 14537/2021
CNR: RJHC020825772021 | URN: CW / 31762U / 2021
Abhay Kumar Godha Son Of Shri Chiranji Lal Godha, Resident Of
750, Aachariyon Ka Rasta, Kishanpole Bazar, Jaipur.
----Petitioner
Versus
Assistant Commissioner Of Income Tax, Circle-1, Jaipur Having
Its Office At New Central Revenue Building, Statue Circle,
Bhagwan Das Road, C-Scheme, Jaipur.
----Respondent
Connected With
D.B. Civil Writ Petition No. 14552/2021
CNR: RJHC020825662021 | URN: CW / 31800U / 2021
Sanjay Godha Son Of Shri Chiranji Lal Godha, Resident Of 750,
Aachariyon Ka Rasta, Kishanpole Bazar, Jaipur.
----Petitioner
Versus
Assistant Commissioner Of Income Tax, Circle-1, Jaipur Having
Its Office At New Central Revenue Building, Statue Circle,
Bhagwan Das Road, C-Scheme, Jaipur.
----Respondent
For Petitioner(s) : Mr. Siddarth Ranka
For Respondent(s) : Mr. Siddharth Bapna with
Ms. Tanushka Saxena
Mr. Jai Prakash Meena
Ms. Yashvi Khandelwal
HON'BLE THE CHIEF JUSTICE MR. SANJAY K. AGRAWAL
HON'BLE MR. JUSTICE BIPIN GUPTA
Judgment
05/11/2026
1. I n both the writ petitions, the petitioners have sought the
following reliefs:
"A. by an appropriate writ, order or direction be issued for
annulling, quashing or canceling the impugned reassessment
notice dated 28.03.2021 issued u/s. 148 of the Act for the
assessment year 2014-2015 and all consequential proceedings
in reference thereto;
B. to allow the Writ Petition and award costs of this petition;
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C. for such further and other reliefs, as this Hon'ble Court may
deem fit and proper in the nature and circumstances of the
case."
2. Learned counsel for the petitioners submits that once the
Settlement Commission has passed an order dated 29.09.2016
under Section 245D(4) of the Income-tax Act, 1961 (hereinafter
referred to as ‘the Act of 1961’), there was no occasion for the
respondent-revenue to issue any notice under Section 148 of the
Act of 1961.
3. Learned counsel for the petitioners, therefore, prays that the
notice dated 28.03.2021 (Annexure-2) may be quashed and set
aside, as the Settlement Commission has already passed its order
under Section 245D(4) of the Act of 1961 on 29.09.2016.
4. Learned counsel for the petitioners has placed reliance upon
the judgment passed by the Hon’ble Apex Court in the case of
Assistant Commissioner of Income Tax & Another vs. M/s
Omaxe Limited in Civil Appeal No.9190 of 2013 decided on
16.09.2026 . The relevant portion of the said judgment is
reproduced herein below:–
"23. The Revenue’s argument for issuing the Reassessment
Notice rests on the words in Section 245C of the Act, 1961,
viz., “containing a full and true disclosure of his income which
has not been disclosed before the Assessing Officer”, but it
overlooks the expression in Section 245C, viz., “the manner in
which such income has been derived”. On a plain construction
of both the italicised expressions, what constitutes a case for
consideration before the ITSC would be an Assessee making an
Application containing a full and true disclosure of the
Assessee’s income which has not been disclosed before the AO,
and the manner in which such income has been derived.
Therefore, the additional amount of income-tax payable in the
disclosure will depend on the manner in which such income has
been derived by the Assessee. In the case on hand, the
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Assessee has disclosed the revenue included in the Assessee's
gross total income, and, by claiming deductions under the Act,
1961, the net income liable for tax is set out. Once the ITSC
admits the case for settlement, the consideration is the return
for the assessment year, including deductions. The Report is
called for on the Assessee's Application, and there is no
gainsaying that, while participating in the Settlement before
ITSC, the Revenue allowed a deduction that is otherwise
disallowable. The normal presumption is that the Revenue filed
its Report on the Assessee's application. Once the matter is
concluded under Section 245D(4), the decision attains finality,
and the scope of judicial review, in view of the precedents
referred to above, is also limited.
24. The Revenue is not without recourse to realise tax on
undisclosed income, even in cases filed under Chapter XIX-A of
the Act, 1961. The Revenue has the option to move under
Section 245D(6) of the Act, 1961 on the grounds of fraud and
misrepresentation. The words “fraud and misrepresentation”
depend on the circumstances and are to be decided on a case-
to-case basis; by making out a case under either head, the
ITSC’s Order is reopened, which ultimately leads to the
Settlement Order being declared void. The normal assessment
procedure is restored or enabled, but not otherwise. If the
jurisdiction of the AO under Sections 143(2), 148, 154, etc., is
made independent and available for exercise again, the finality
attached to the Settlement Commission will be defeated.
Parliament did not envisage this course. On the contrary, while
reopening the issues before the ITSC is provided for, judicial
review by the Constitutional Courts under Articles 226 and
32/136 is available, but the AO’s power to reassess the
Settlement Order passed by the ITSC is unavailable.
25. In fine, through the mechanism under Chapter XIX-A of the
Act, 1961, the Assessee and the Revenue avoid the crust and
crumb. To wit, the Revenue avoids the crust by realising the
crumb of tax on suppressed or undisclosed income through the
Assessee's voluntary disclosure. Similarly, through complete
and fair disclosure of suppressed income and entries, the
Assessee avoids the crust of penal interest, prosecution, etc.,
and the crumb offered is payment of tax beforehand. The
Revenue and the Assessee must take the Crust and the Crumb
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together. By operation of Section 245C(3), the Assessee is
precluded from withdrawing the Application filed under Section
245C. The Revenue can oppose continuation before the ITSC
based on the material and grounds discovered during the
search and seizure against the Assessee. The Revenue
participates before the ITSC in the Assessee's Application,
including any income further disclosed by the Assessee.
Therefore, the argument that, after the proceedings before the
ITSC attain finality, the regular assessment/re-assessment is
still available to the Revenue is contrary to the defining
expressions in Sections 245C, 245D(2), 245D(3), and finally
245D(4) of the Act, 1961. The Revenue has to revisit the
procedure under Section 245D(6) by making out a case before
the ITSC, but not otherwise. Thus, the Assessee and the
Revenue are aware of the crust and the crumb in this
settlement procedure before the ITSC. Once the crust is
avoided and the crumb is accepted, further crust and crumb
are not the intention of Chapter XIX-A of the Act, 1961.
26. The Revenue availed the remedy under Section 245D(6) of
the Act, 1961 before the ITSC, resulting in the findings
recorded in the Order dated 16.12.2011, which has become
final.
27. For the reasons stated above, we find no merit in the
Appeal. The Appeal fails and is dismissed.
28. Pending application(s), if any, stand disposed of
accordingly."
5. Per contra , learned counsel for the respondent-revenue could
not refute the law laid down by the Hon'ble Apex Court in the case
of Assistant Commissioner of Income Tax (Supra) . However,
he submits that the said judgment also provides that appropriate
remedy for the revenue in cases where the Settlement
Commission has passed an order is available under Section
245D(6) of the Act of 1961.
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6. Learned counsel for the respondent further submits that the
respondent-revenue may be granted liberty to avail the said
remedy under the relevant provisions of the Act of 1961.
7. Heard learned counsel for both the parties and perused the
material available on record.
8. It is not disputed between the parties that the Settlement
Commission passed an order dated 29.09.2016 under Section
245D(4) of the Act of 1961 for the assessment year in respect of
which the notice dated 28.03.2021 was issued under Section 148
of the Act of 1961.
9. Relying upon the judgment passed by the Hon'ble Apex
Court in case of Assistant Commissioner of Income Tax
(Supra) , this Court is of the considered view that the notice dated
28.03.2021 in respect of the assessment year 2014-15 could not
have been issued by the respondent-revenue, once the order of
settlement dated 29.09.2016 had already been passed.
10. The respondent-revenue is right in submitting that the
remedy available to it, as recognized by the Hon’ble Apex Court in
cases where the Settlement Commission has passed an order, is to
proceed under Section 245D(6) of the Act of 1961.
11. Accordingly, the present writ petition filed by the petitioner is
partly allowed. The impugned notice dated 28.03.2021 (Annexure-
2) is hereby quashed and set aside. The respondent-revenue will
be at liberty to proceed in accordance with law under section
245D(6) of the Act of 1961, if they wish to do so.
12. Pending application(s), if any, stand disposed of.
(BIPIN GUPTA),J
(SANJAY K. AGRAWAL),CJ
SA/44-45/MAHIMA
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