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SC admits I-T appeal challenging settlement commission’s powers

SC admits I-T appeal challenging settlement commission’s powers

The Supreme Court on Tuesday admitted the income tax department’s appeal questioning its settlement commission’s (the Income Tax Settlement Commission) powers to entertain cases related to black money in foreign countries held by NRIs.
British Virgin Islands firm Overseas Pearl (OPL), belonging to UAE residents Vimal K Patel, Samir K Patel and Mehul K Patel, was named in the 2016 Panama papers expose. The three brothers are also the promoters of Vadodara-based Banco Products, the parent company of OPL. The assessees never disclosed any foreign income or asset, including foreign bank accounts, in their tax returns though they were tax residents in India from 2005-06 to 2013-14, according to the department.

Challenging the Gujarat High Court’s judgment that upheld the jurisdiction of the Income Tax Settlement Commission to entertain the case of black money in foreign countries held by Patels, the I-T department told the apex court that the Commission lacked jurisdiction over the matters where proceedings were initiated under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.
A Bench led by justice DY Chandrachud issued notice to the settlement commission and the three Patel brothers on the I-T’s plea alleging that Patels being the owners of the firm were liable to action under the 2015 Act, and the Commission had no power to settle the issue as the black money law bars it from settling the matter under the I-T Act.

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