Amended and updated notes on section 245F of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to Powers and procedure of Settlement Commission.
Chapter XIXA (Sections 245A to 245L) of the Income Tax Act 1961 deals with the provisions related to settlement of cases. Section 245F of IT Act 1961 provides for Powers and procedure of Settlement Commission.
Recently, we have discussed in detail section 245E (Power of Settlement Commission to reopen completed proceedings) of IT Act 1961. Today, we learn the provisions of section 245F of Income-tax Act 1961. The amended provision of section 245F is effective for financial year 2022-23 relevant to the assessment year 2023-24.
In this article, you will learn detail of the provisions of section 245F of the Income Tax Act, 1961 Bare Act read with the Income-tax Rules, 1962 as provided by Ministry of Law and Justice, Government of India.
Section-245F: Powers and procedure of Settlement Commission
Section 245F(1) of Income Tax Act
In addition to the powers conferred on the Settlement Commission under this Chapter, it shall have all the powers which are vested in an income-tax authority under this Act.
Section 245F(2) of Income Tax Act
Where an application made under section 245C has been allowed to be proceeded with under section 245D, the Settlement Commission shall, until an order is passed under sub-section (4) of section 245D, have, subject to the provisions of sub-section (3) of that section, exclusive jurisdiction to exercise the powers and perform the functions of an income-tax authority under this Act in relation to the case :
Provided that where an application has been made under section 245C on or after the 1st day of June, 2007, the Settlement Commission shall have such exclusive jurisdiction from the date on which the application was made:
Provided further that where—
- (i) an application made on or after the 1st day of June, 2007, is rejected under sub-section (1) of section 245D; or
- (ii) an application is not allowed to be proceeded with under sub-section (2A) of section 245D, or, as the case may be, is declared invalid under sub-section (2C) of that section; or
- (iii) an application is not allowed to be further proceeded with under sub-section (2D) of section 245D,
the Settlement Commission, in respect of such application shall have such exclusive jurisdiction upto the date on which the application is rejected, or, not allowed to be proceeded with, or, declared invalid, or, not allowed to be further proceeded with, as the case may be.
Section 245F(3) of Income Tax Act
Notwithstanding anything contained in sub-section (2) and in the absence of any express direction to the contrary by the Settlement Commission, nothing contained in this section shall affect the operation of any other provision of this Act requiring the applicant to pay tax on the basis of self-assessment in relation to the matters before the Settlement Commission.
Section 245F(4) of Income Tax Act
For the removal of doubt, it is hereby declared that, in the absence of any express direction by the Settlement Commission to the contrary, nothing in this Chapter shall affect the operation of the provisions of this Act in so far as they relate to any matters other than those before the Settlement Commission.
Section 245F(7) of Income Tax Act
The Settlement Commission shall, subject to the provisions of this Chapter, have power to regulate its own procedure and the procedure of Benches thereof in all matters arising out of the exercise of its powers or of the discharge of its functions, including the places at which the Benches shall hold their sittings.
Section 245F(8) of Income Tax Act
On and from the 1st day of February, 2021, the powers and functions of the Settlement Commission under this section shall be exercised or performed, by the Interim Board and all the provisions of this section shall mutatis mutandis apply to the Interim Board as they apply to the Settlement Commission.
[Sub-section(8) of section 245F newly inserted w.e.f. 1-February-2021 by the Finance Act 2021]