Case Laws & Commentary · Income-tax Act, 1961 (as amended by the Finance Act, 2026) · bharattax.co Treatise
Provision: No person is entitled to inspect, or obtain copies of, reports made by an income-tax authority to the Commission; but the Commission may, in its discretion, furnish copies to the applicant on his application, and is to give him a reasonable opportunity to be heard; for the purpose of supplying information, it may, after such hearing, draw the applicant's attention to such parts of the report as it considers fit.
Heading: Inspection, etc., of reports.
Finance Act, 2026: Not amended.
Authorities digested: 1 (candour rule — a procedural/natural-justice provision regulating access to the Commissioner's report).
A. SECTION COMMENTARY
1. Confidentiality balanced against fairness
Section 245G withholds, as of right, the Commissioner's reports from inspection or copying, while leaving the Commission a discretion to furnish copies to the applicant and a duty to hear him. The provision balances the confidentiality of the Revenue's internal reporting against the applicant's right to meet the case against him. The natural-justice content is real: where the Commission relies on a report adverse to the applicant, fairness requires that the substance be put to him so he can respond.
2. The governing fairness principle
The general principle — that material used against a party must be disclosed to him in substance — is the same as that applied to settlement rejection in R.B. Shreeram Durga Prasad and to assessment generally. Section 245G operationalises it for the Commissioner's report: the Commission may keep the report from inspection but must, in fairness, draw the applicant's attention to the parts on which it proposes to act.
3. Candour note
No reported decision turning specifically on section 245G has been traced. The provision is procedural; its fairness content is supplied by the general natural-justice authorities, identified as such.
B. STATUTORY POSITION (verbatim text)
The text of the section, as it stands in the Act (FA-2025 base), is set out below.
245G. No person shall be entitled to inspect, or obtain copies of, any reports made by any income-tax authority to the Settlement Commission; but the Settlement Commission may, in its discretion, furnish copies thereof to any such person on an application made to it in this behalf and on payment of the prescribed fee :
Provided that, for the purpose of enabling any person whose case is under consideration to rebut any evidence brought on record against him in any such report, the Settlement Commission shall, on an application made in this behalf, and on payment of the prescribed fee by such person, furnish him with a certified copy of any such report or part thereof relevant for the purpose:
Provided further that on or after the 1st day of February, 2021, functions of the Settlement Commission under this section shall be performed by the Interim Board and the provisions of this section shall mutatis mutandis apply to Interim Board as they apply to the Settlement Commission.
C. AUTHORITIES
Procedural/confidentiality provision; the governing fairness principle is cognate to the general natural-justice line.
Held / relevance: Material adverse to the applicant cannot be used without affording him a hearing; an order in breach is of no value. Applied to section 245G, the substance of an adverse report must be put to the applicant. Cited as the governing fairness authority; no decision specific to section 245G has been traced.
Compiled for the bharattax.co Treatise on the Income-tax Act, 1961 (as amended by the Finance Act, 2026). Statutory text is reproduced from the Income-tax Act, 1961 (text as printed in the local Act, base text amended up to the Finance Act, 2025), with the publisher's footnote apparatus and amendment-marker brackets removed; three asterisks (***) denote words or a provision omitted by amendment and retained only to mark the omission. The Income-tax Settlement Commission ceased to operate for applications made on or after 1 February 2021 (Finance Act, 2021); pending applications stand transferred to the Interim Board for Settlement (section 245AA). Finance Act, 2026 makes no change to any section of Chapter XIX-A. Citations are stated as reported; orders of the Tribunal and High Courts are flagged as such. Where a section has not been judicially construed, that is stated candidly and the nearest governing authority is given. This material is for professional reference and is not legal advice.
CHAPTER XIX-A — SETTLEMENT OF CASES
Section 245G — Inspection, etc., of Reports
Case Laws & Commentary · Income-tax Act, 1961 (as amended by the Finance Act, 2026) · bharattax.co Treatise
Provision: No person is entitled to inspect, or obtain copies of, reports made by an income-tax authority to the Commission; but the Commission may, in its discretion, furnish copies to the applicant on his application, and is to give him a reasonable opportunity to be heard; for the purpose of supplying information, it may, after such hearing, draw the applicant's attention to such parts of the report as it considers fit.
Heading: Inspection, etc., of reports.
Finance Act, 2026: Not amended.
Authorities digested: 1 (candour rule — a procedural/natural-justice provision regulating access to the Commissioner's report).
A. SECTION COMMENTARY
1. Confidentiality balanced against fairness
Section 245G withholds, as of right, the Commissioner's reports from inspection or copying, while leaving the Commission a discretion to furnish copies to the applicant and a duty to hear him. The provision balances the confidentiality of the Revenue's internal reporting against the applicant's right to meet the case against him. The natural-justice content is real: where the Commission relies on a report adverse to the applicant, fairness requires that the substance be put to him so he can respond.
2. The governing fairness principle
The general principle — that material used against a party must be disclosed to him in substance — is the same as that applied to settlement rejection in R.B. Shreeram Durga Prasad and to assessment generally. Section 245G operationalises it for the Commissioner's report: the Commission may keep the report from inspection but must, in fairness, draw the applicant's attention to the parts on which it proposes to act.
3. Candour note
No reported decision turning specifically on section 245G has been traced. The provision is procedural; its fairness content is supplied by the general natural-justice authorities, identified as such.
B. STATUTORY POSITION (verbatim text)
The text of the section, as it stands in the Act (FA-2025 base), is set out below.
245G. No person shall be entitled to inspect, or obtain copies of, any reports made by any income-tax authority to the Settlement Commission; but the Settlement Commission may, in its discretion, furnish copies thereof to any such person on an application made to it in this behalf and on payment of the prescribed fee :
Provided that, for the purpose of enabling any person whose case is under consideration to rebut any evidence brought on record against him in any such report, the Settlement Commission shall, on an application made in this behalf, and on payment of the prescribed fee by such person, furnish him with a certified copy of any such report or part thereof relevant for the purpose:
Provided further that on or after the 1st day of February, 2021, functions of the Settlement Commission under this section shall be performed by the Interim Board and the provisions of this section shall mutatis mutandis apply to Interim Board as they apply to the Settlement Commission.
C. AUTHORITIES
Procedural/confidentiality provision; the governing fairness principle is cognate to the general natural-justice line.
Cluster 1 — Fairness in the use of the report
R.B. Shreeram Durga Prasad v. Settlement Commission, (1989) 176 ITR 169 (SC) [cognate]
Held / relevance: Material adverse to the applicant cannot be used without affording him a hearing; an order in breach is of no value. Applied to section 245G, the substance of an adverse report must be put to the applicant. Cited as the governing fairness authority; no decision specific to section 245G has been traced.
Compiled for the bharattax.co Treatise on the Income-tax Act, 1961 (as amended by the Finance Act, 2026). Statutory text is reproduced from the Income-tax Act, 1961 (text as printed in the local Act, base text amended up to the Finance Act, 2025), with the publisher's footnote apparatus and amendment-marker brackets removed; three asterisks (***) denote words or a provision omitted by amendment and retained only to mark the omission. The Income-tax Settlement Commission ceased to operate for applications made on or after 1 February 2021 (Finance Act, 2021); pending applications stand transferred to the Interim Board for Settlement (section 245AA). Finance Act, 2026 makes no change to any section of Chapter XIX-A. Citations are stated as reported; orders of the Tribunal and High Courts are flagged as such. Where a section has not been judicially construed, that is stated candidly and the nearest governing authority is given. This material is for professional reference and is not legal advice.