Section 245I and Section 245J of Income Tax Act, 1961
Section 245I gives finality to matters stated in an order of settlement passed under Section 245D(4). Section 245J provides the statutory mechanism for recovery of sums specified in a settlement order and for penalty in case of payment default.
Section 245I - Order of settlement to be conclusive
Section 245I provides that every order of settlement passed under Section 245D(4) is conclusive as to the matters stated in that order. A matter covered by such an order cannot be reopened in a proceeding under the Income-tax Act or under any other law for the time being in force, except where Chapter XIX-A itself otherwise permits.
Meaning of conclusiveness
The provision gives statutory finality to the matters actually stated and covered by the settlement order. The protection is therefore linked to the scope of the order passed under Section 245D(4), and remains subject to exceptions expressly contained in Chapter XIX-A.
Connection with Section 245D
Section 245D lays down the procedure governing settlement applications and the passing of a settlement order. Section 245I operates after an order under Section 245D(4) has been passed and determines its conclusive effect.
Section 245J - Recovery of sums due under settlement order
Section 245J deals with enforcement of the monetary obligations specified in an order of settlement passed under Section 245D(4). A sum specified in the settlement order may be recovered subject to any conditions stated in that order.
Penalty for default in payment
If there is a default in payment of a sum specified in the settlement order, a penalty for that default may be imposed and recovered in accordance with Chapter XVII of the Income-tax Act.
Authority responsible for recovery
The Assessing Officer having jurisdiction over the person who made the settlement application under Section 245C is empowered to recover the sum and any applicable penalty for default in accordance with Section 245J and Chapter XVII.
Section 245I and 245J at a glance
| Provision | Purpose | Practical effect |
|---|---|---|
| Section 245D(4) | Order of settlement | Provides the underlying settlement order to which Sections 245I and 245J apply. |
| Section 245I | Finality of settlement | Matters stated and covered by the settlement order are conclusive, subject to Chapter XIX-A. |
| Section 245J | Recovery | Authorises recovery of sums specified in the settlement order and penalty for payment default under Chapter XVII. |
| Section 245C | Settlement application | Identifies the person whose jurisdictional Assessing Officer carries out recovery under Section 245J. |
Position before Bharatiya Sakshya Adhiniyam, 2023
Sections 245I and 245J concern the legal finality and recovery of a settlement order rather than rules governing admissibility or proof of evidence. For matters arising before commencement of the Bharatiya Sakshya Adhiniyam, 2023, any separate evidentiary issue is governed by the law applicable to that period, while the substantive effect of the settlement order remains governed by Chapter XIX-A of the Income-tax Act.
Official resources
Income Tax Department - Section 245I