Powers and procedure of Settlement Commission
Section 245F of the Income-tax Act, 1961 deals with powers and procedure of Settlement Commission. 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. The Act came into force on 01 Apr 1962. Repealed by the Income-tax Act, 2025 with effect from 1 April 2026, but conduct before that date is still charged, tried and appealed under it.
(1) 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.
(2) 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.
(3) 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.
(4) 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.
(5) [***] (6) [***] (7) 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.
(8) 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.
Inspection, etc., of reports.
Section 245F, The Income-tax Act, 1961 (Act 43 of 1961).
Now in the Income-tax Act
No provision of the Income-tax Act is textually close to this one. No counterpart in the new Act
Measured by comparing the text of the two provisions, not taken from an official correspondence table — there is no machine-readable one. See both texts side by side before relying on it.
Both regimes are live. The repealed enactment still governs what happened while it was in force. We never redirect one to the other.
Cross-references
Extracted from the operative text of the enactments themselves. Every destination below exists in our corpus.
This section refers to
Related judgements & precedents
These are some judgments that construed this section, and hold precedence value. They hold authority on how to read, interpret and use this section.
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Brij Lal vs Commnr. of Income Tax, Jalandhar
Court's Decision & Legal Precedent
Sections 234A, 234B and 234C of the Income Tax Act, 1961 are applicable to proceedings of the Settlement Commission under Chapter XIX-A to the extent indicated in the judgment, specifically that these interest provisions are applicable up to the date of the order under section 245D(1) allowing the settlement application and not beyond to the date of the final settlement order under section 245D(4). The Settlement Commission cannot reopen its concluded proceedings by invoking section 154 of the Act to levy interest under section 234B, as section 154 is inapplicable to Chapter XIX-A proceedings which have their own finality regime under section 245I.
On this section: Settlement Commission has all powers vested in income-tax authority; exclusive jurisdiction over case once application allowed under section 245D(1); section 245F(3) clarifies self-assessment provisions still apply
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Brij Lal vs Commnr. of Income Tax, Jalandhar
Court's Decision & Legal Precedent
Sections 234A, 234B and 234C of the Income Tax Act, 1961 are applicable to proceedings of the Settlement Commission under Chapter XIX-A to the extent that they govern the computation of interest on undisclosed income disclosed in settlement applications. However, the terminal point for levy of interest under section 234B is the date of the order under section 245D(1) (admission of settlement application) and not the date of the order under section 245D(4) (final settlement order). The Settlement Commission cannot reopen its concluded proceedings by invoking section 154 of the Act to levy interest under section 234B that was not levied in the original proceedings, as section 154 is not applicable to Chapter XIX-A proceedings and section 245I makes settlement orders final and conclusive.
On this section: Applied to establish that Settlement Commission has all powers of income tax authority; section 245F(3) clarifies self-assessment provisions apply; section 245F(4) clarifies Chapter XIX-A does not affect other provisions
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C. I. T. , Jalpaiguri vs Om Prakash Mittal
Court's Decision & Legal Precedent
The Income Tax Settlement Commission possesses the statutory power under Section 245D(6) to declare a settlement order void on the grounds that it was obtained by fraud or misrepresentation of facts. Such power is not limited to suo motu action by the Commission but can be invoked by the revenue (CIT) by filing an application with material substantiating fraud or misrepresentation. The examination of fraud or misrepresentation does not constitute review of the earlier Commission decision or appellate reconsideration by a subsequent Bench, but rather determination of a mandatory statutory condition precedent to the validity and finality of the settlement order. The foundation of the settlement scheme under Chapter XIX-A is the requirement of 'full and true disclosure' in the application under Section 245C. If an order is obtained by fraud or misrepresentation of facts, the fundamental premise of true disclosure is absent, and the order cannot stand as valid. Therefore, the Commission's jurisdiction under Section 245D(6) to examine and determine fraud or misrepresentation is not merely permissive but necessary to give effect to the statutory condition that every settlement order must provide for its voidness upon such subsequent findings.
On this section: Exclusive jurisdiction of Commission - once application is allowed to be proceeded with, Commission has exclusive jurisdiction to exercise income-tax authority powers until order under Section 245D(4) is passed. Establishes scope of Commission's plenary authority
The holding above is the ratio decidendi as extracted from the judgment by eCourts India, reproduced unaltered — it is a rendering of the court's reasoning, not a substitute for its words. Read the order itself before relying on it.
Questions about Section 245F
What have the courts held on Section 245F of the Income-tax Act?
Brij Lal vs Commnr. of Income Tax, Jalandhar (21 Oct 2010) is the leading judgment on this section among those set out below: Settlement Commission has all powers vested in income-tax authority; exclusive jurisdiction over case once application allowed under section 245D(1); section 245F(3) clarifies self-assessment provisions still apply. Another 2 judgments on this section are set out below, all of them from the Supreme Court. They run from 2005 to 2010.
How do I find court cases under Section 245F of the Income-tax Act?
In judgments and charge sheets this section is written several ways, and each form finds a different set of orders. These search the full text of every order eCourtsIndia holds, best matches first: Income Tax Act 245F, section 245F Income Tax Act, section 245F of the Income-tax Act. Each opens the full list of orders on eCourtsIndia, where it can be narrowed by court, year and outcome. 3 reported judgments on this section are set out on this page, beginning with Brij Lal vs Commnr. of Income Tax, Jalandhar (21 Oct 2010).
What should I read with Section 245F of the Income-tax Act, and has it changed?
Its own text turns on section 245C (Application for settlement of cases), section 245D (Procedure on receipt of an application under section 245C), so none of them can safely be read on its own. 4 other provisions in this corpus refer back to it.
When did Section 245F of the Income-tax Act come into force?
Section 245F of the Income-tax Act, cited as Income Tax Act 245F, came into force on 01 Apr 1962, having been enacted on 13 Sep 1961. It is no longer in force.
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- 155. Other amendments5451 words
- 139. Return of income5400 words
Source and method. Compiled from the enactments of Parliament and of the State legislatures as published on India Code, and republished together with commentary and other original matter under section 52(1)(q)(ii) of the Copyright Act, 1957. Structured, cross-referenced and maintained by eCourtsIndia. Recovered from the consolidated text published by the Income Tax Department, as amended by the Finance Act, 2026. India Code holds no record of this Act in any form. This page is not a substitute for legal advice.