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5. PCIT vs. MD Industries Pvt. Ltd.
(2025) 473 ITR 751 (SC)
Settlement of a case – Appeal before the Commissioner of Income-tax (Appeals) – When the application before the Settlement Commission is pending and an order under Section 245D(4) of the Income-tax Act, 1961, on the application is yet to be passed, Commissioner of Income Tax (Appeals) should keep the appellate proceedings in abeyance till the disposal of the application by the Settlement Commission - It is only if the application for settlement is rejected without providing for terms of settlement that Section 245HA of the Act will be applicable and the appellate proceedings will stand revived.
A survey action u/s.133A of the Act was carried out in the premises of Shri Pankaj Danawala CA and in the premises of MD Industries by the DDIT (Inv) II, Surat on 11.03.2005. During the survey Shri Pankaj Danawala CA, was found to have created large number of bogus capital build-up cases in the name of different persons by adopting various modus operandi. Further, such funds were transferred to the various assessees of MD group. Shri Pankaj Danawala, in his statement recorded during the survey, accepted this fact and Shri Kirit Patel, the Director of MD Industries Pvt. Ltd. vide his statement recorded on oath u/s.131 of the Act on 2
