Settlement of case — Application for settlement in assessment pursuant to search and seizure — Undisclosed income in jewellery business — Modus operandi of inflation of refinery loss — Full and true disclosure in application of the manner in which undisclosed income derived — Rejection of application on ground of failure to make a full and true disclosure — Single Judge of the High Court dismissed the writ petition — Division Bench of the High Court allowed the appeal and held that failure of competent authority to scrutinize the assessee’s application in detail resulted in the dismissal of the writ petition — Order in the writ petition and order rejecting application for settlement of the case set aside — Matter remanded to the competent authority with a direction to scrutinize the application.

20. Khazana Jewellery (P) Ltd. v. Income-Tax Settlement Commission:

(2026) 487 ITR 19 (Mad): 2026 SCC OnLine Mad 3939:

A. Y. 2011-12 to 2017-18: Date of order 16/02/2026:

Ss. 245C(1) and 245D(4) of ITA 1961

Settlement of case — Application for settlement in assessment pursuant to search and seizure — Undisclosed income in jewellery business — Modus operandi of inflation of refinery loss — Full and true disclosure in application of the manner in which undisclosed income derived — Rejection of application on ground of failure to make a full and true disclosure — Single Judge of the High Court dismissed the writ petition — Division Bench of the High Court allowed the appeal and held that failure of competent authority to scrutinize the assessee’s application in detail resulted in the dismissal of the writ petition — Order in the writ petition and order rejecting application for settlement of the case set aside — Matter remanded to the competent authority with a direction to scrutinize the application.

The petitioner/assessee is a company engaged in the business of manufacturing and trading of jewels. A search u/s. 132 of the Income-tax Act, 1961 was conducted at