On 16 September 2026, the Supreme Court in ACIT v. M/s Omaxe Limited (Civil Appeal No. 9190 of 2013) held that once the Income Tax Settlement Commission has passed a final order, the Assessing Officer cannot reopen the settled matters through ordinary reassessment. A Bench of Justice S.V.N. Bhatti and Justice N.V. Anjaria dismissed the Revenue’s appeal and upheld the Delhi High Court’s decision quashing the reassessment.
What was decided
The dispute related to Assessment Year 2006-07. Omaxe, a real estate company, had claimed deduction under Section 80IB(10) for housing projects and approached the Settlement Commission, which passed a final order on 17 March 2008. After a survey in December 2009, the Department formed a view that commercial areas in some projects exceeded the Section 80IB(10) limits, issued a Section 148 notice and made an addition of about Rs 65.65 crore.
The Department had separately applied under Section 245D(6), alleging misrepresentation, but the Commission rejected it as a legal dispute. The Supreme Court held that once an application is admitted under Section 245D(1), the Commission has exclusive jurisdiction, and its order under Section 245D(4) is conclusive. Allowing reassessment afterwards would defeat that finality. Where fraud or misrepresentation is alleged, the remedy lies before the Commission under Section 245D(6), not through a Section 148 notice.
Why it matters
The ruling reinforces the principle that a statutory settlement is binding on both sides as a whole. Businesses that resolved disputes through the settlement route can rely on that finality, and a later survey or change of view does not, by itself, open the door to fresh reassessment of the same matters.
Many settlement-era years were also covered by later search or reassessment action. The judgment gives a clear test: the question is whether the matter was part of the settled case, and if so, whether the Revenue used the specific statutory remedy available against the settlement.
Practical points
- Keep a complete record of the settlement application, the Section 245D(4) order and any Section 245D(6) proceedings.
- If a reassessment notice touches a settled year, compare its grounds with the issues covered by the settlement order.
- Raise the jurisdictional objection at the Section 148A stage itself, supported by the settlement record.
- Note that the ruling turns on the 1961 Act’s settlement scheme; transitional provisions of the Income-tax Act, 2025 should be read alongside it for later years.
Sources: LiveLaw Biz, 16 Sep 2026.
For a confidential discussion on reassessment of settled or past years, see Income-tax Search & Seizure Lawyer.
General legal information only; not legal advice or solicitation.
