BHAGABATI PRASAD BANERJEE, J. ( 1 ) THE Tribunal has referred the following questions of law before this court under Section 256 (1) of the Income-tax Act, 1961 ( "the Act" ) :"1. Whether, on the facts and in the circumstances of the case, the Tribunal was justified in rejecting the claim made by the assessee that the additional income offered for taxation before the Settlement Commission after finalisation of the balance-sheets for the respective years, and accepted by the Settlement Commission should be treated as reserve for the purposes of computation of capital under the Companies (Profits) Surtax Act, 1964, and in sustaining the order of the lower authorities ? Whether in doing so, the Tribunal acted perversely? ( 2 ) WHETHER, on the facts and in the circumstances of the case, the Tribunal acted perversely in sustaining the finding of the lower authorities that, on the dates of the relevant balance-sheets, the assessee had undisclosed income not brought into account and the same was a mass of unappropriated profits to which the directors had no occasion to apply their mind and as such the said amount was not a reserve for the purposes of the Surtax Act ? ( 3 ) WHETHER, on the facts and in the circumstances of the case, the Tribunal is justified in sustaining the finding of the lower authorities and in rejecting the recast balance-sheets ? ( 4 ) WHETHER the Tribunal was justified in sustaining the decision of the lower authorities and in rejecting the claim made by the assessee that the excess provision for taxation is not a provision but a reserve ? ( 5 ) WHETHER the finding of the Tribunal that the excess of tax provision was left unappropriated and is a provision and not a reserve is perverse ?"2. The assessment years involved are 1969-70 to 1975-76 for which the relevant periods of account are March 31, 1969, to March 31, 1975, respectively. 3. The facts of this case as set out in the statement of case are as follows : "the assessee is the Hooghly Mills Ltd. and the reference relates to the assessment years 1969-70 to 1975-76. The assessee follows the financial year as the accounting period. The method of accounting is mercantile. 3. The facts of this case as set out in the statement of case are as follows : "the assessee is the Hooghly Mills Ltd. and the reference relates to the assessment years 1969-70 to 1975-76. The assessee follows the financial year as the accounting period. The method of accounting is mercantile. On February 25, 1976, there was a search conducted by the officers of the Income-tax Department when wide difference between stock of goods in godown and as per accounts was detected on physical verification. In order to avoid any trouble and harassment, the assessee made an application under Section 245c (1) of the Income-tax Act, 1961, before the Income tax Settlement Commission. The Settlement Commission passed their order on January 14, 1977. By the said application the assessee prayed that Rs. 2. 63 crores as on March 31, 1976, may be spread over nine assessment years 1968-69 to 1976-77. The Settlement Commission acceded to the request made by the assessee. According to the assessee all the alleged concealed stock was disclosed in the closing slock as on March 31, 1976, and the undisclosed stock as on March 31, 1976, was at Rs. 2,61,41,229. On this basis, the income-tax assessment for the assessment year 1976-77 was made on Rs. 14,17,328 and the said sum of Rs. 2,61,41,229 was spread over eight years, namely, the assessment years 1968-69 to 1975-76 equally at the rate of Rs. 32,67,653 per year as settled and accepted by the Settlement Commission. "4. In paragraph 18 of their order, the Settlement Commission stated as follows : " As for the penalty, if any, to which the applicant company may be liable under Section 9 or 20 of the Companies (Profits) Surtax Act, 1964, the reduction or waiver is beyond the scope of Section 245h. " " In view, however, of the co-operation extended by the assessee in the settlement of its tax dues before us, we would recommend sympathetic consideration of the plea ,. . Apart from deserving the same treatment in the matter of penalty, the assessec's request for permission to recast its balance-sheets for the various years in the light of the present settlement for assessing the surtax liability also merits acceptance. "5. . Apart from deserving the same treatment in the matter of penalty, the assessec's request for permission to recast its balance-sheets for the various years in the light of the present settlement for assessing the surtax liability also merits acceptance. "5. On the basis of the above recommendation made by the Settlement Commission, the assessee in its assessment under the Companies (Profits) Surtax Act, 1964 ("the Surtax Act"), made the following claim : (i) The order of the Settlement Commission passed under Section 245d of the Act is conclusive as to matters stated therein in view of Section 245-I of the Act. Hence, the matter stated in paragraph 18 of the order passed by the Settlement Commission is binding. (ii) The recast balance-sheet and net balance-sheet of the assessee-company audited and passed as per the Companies Act, 1956, is to be considered in making the surtax assessment, in view of para 18 of the Settlement Commission's order. The Income-tax Officer did not allow the claim made by the assessee. Being aggrieved by the order of the Income-tax Officer, the assessee preferred separate appeals for each of the assessment years concerned which were heard by the Commissioner (Appeals) and were disposed of by a consolidated order. Before the Commissioner (Appeals), the assessee made the following claims : (a) The income which has been disclosed before the Settlement Commission and accepted by the Settlement Commission and spread over the eight assessment years should be treated as a reserve particularly in view of the direction given by the Settlement Commission in paragraph 18 of their order. (b) Excess taxation reserve for the assessment years 1959-60, 1961-62 to 1971-72 should be considered in computing the capital base inasmuch as the said amount has been credited to the profit arid loss account. (c) Some other grounds with which we are not concerned in the present reference. ( 6 ) THE Commissioner (Appeals) rejected the first point above for the reasons stated in paragraphs 14 to 21 of his order. The Commissioner (Appeals) directed the Income-tax Officer to recalculate the deduction under rule 2 of the Second Schedule to the Act for the reasons discussed in paragraphs 21 to 27 of his order. As regards point (b) above, the Commissioner (Appeals ) rejected the said contention for the reasons discussed in paragraphs 34 and 35 of his order. The Commissioner (Appeals) directed the Income-tax Officer to recalculate the deduction under rule 2 of the Second Schedule to the Act for the reasons discussed in paragraphs 21 to 27 of his order. As regards point (b) above, the Commissioner (Appeals ) rejected the said contention for the reasons discussed in paragraphs 34 and 35 of his order. ( 7 ) THE assessee then brought the matter in second appeal before the Tribunal. The Tribunal rejected the appeals filed by the assessee holding, inter alia, as follows : "i have duly considered the appellant's arguments but I find them unacceptable. The Settlement Commission can pass an order of settlement under Section 245d (4) on the matters covered by the application and any other matter relating to the 'case' not covered by the application but referred to in the report of the Commissioner. under Section 245d (1) or (3 ). Under Section 245c (1), an assessee may, at any stage of a case relating to him, make an application to the Commission to have the ' case ' settled. Under Section 245a (a), 'case' means any assessment or reassessment proceedings of the assessee concerned under the Indian Income-tax Act, 1922, or the Income-tax Act, 1961, pending before any income-tax authority on the date of application (vide CIT v. B. N. Bhattachargee. Under Section 245e, the Settlement Commission may reopen proceedings concerned with the 'case' but which has been completed under the Indian Income-tax Act, 1922, or the Income-tax Act, 1961, by any income-tax authority before the application. Thus, what is referred to the Settlement Commission are matters concerned with income-tax proceedings and what the Commission is authorised under the law to settle are also matters concerning income-tax proceedings. The Commission cannot, for example, order settlement of surtax proceedings or waive penalties under any Act other than the Income-tax Act. Any remarks of the Commission (such as are given in para 18 of their order), therefore, cannot be mandatory or binding on the Income-tax Officer but are in the nature of obiter of a Tribunal (The Settlement Commission is not a court but a Tribunal, vide B. N. Bhattachargee's case. Apart from this, the surtax assessments and computation of capital in relation thereto were not matters covered by the appellant's applications to the Commission and were not matters relating to the 'case' (i. e. , the income-tax proceedings ). Apart from this, the surtax assessments and computation of capital in relation thereto were not matters covered by the appellant's applications to the Commission and were not matters relating to the 'case' (i. e. , the income-tax proceedings ). The 'terms of settlement' sought for by the appellant in the letter dated August 18, 1976, addressed to the Commission did not ( and validly could not) include any reference to surtax assessment. As regards the 'recast balance-sheets' filed by the appellant along with its surtax returns, the Income-tax Officer was also right in disregarding the same. The Companies (Profits) Surtax Act, 1964, as the name implies, relates to companies only. A company is a creature of statute, namely, the Companies Act ( at present the Companies Act, 1956 ). Hence, the balance-sheet referred to in the Surtax Act and its Second Schedule (for the computation of capital) is obviously the balance-sheet conforming to the relevant sections of the Companies Act, i. e. , it should be audited by the auditor, reported on by the directors and passed in the annual general meeting of the shareholders before being accepted as the balance-sheet of the company as on the last date of the relevant accounting period. Such balance-sheets exist in respect of the appellant-company for the relevant assessment years ; what the appellant wants is that such balance-sheets should be superseded by the recast balance sheets (which were not audited by the auditor, not reported on by the directors and not passed in the annual general meeting of the shareholders ). This is prima facie not permissible in law. The appellant has cited CIT v. Mysore Electrical Industries Ltd. in this connection. I wonder how the decision is relevant to the facts of this case. What the Supreme Court decided in Mysore Electrical Industries Ltd. 's case is that for the accounting year 1962-63, financial year which ended on March 31, 1963, the determination of the directors to appropriate various amounts to reserves made on August 8, 1963, had to be related to April 1, 1963, and treated as effective from that day. If the appellant refers to the balance-sheet as on March 31, 1976 (corresponding to the assessment year 1976-77) and the transfer to the general reserves of Rs. If the appellant refers to the balance-sheet as on March 31, 1976 (corresponding to the assessment year 1976-77) and the transfer to the general reserves of Rs. 1,13,15,000 recommended by the directors on February 3, 1977 (which was passed in the annual general meeting held on March 31, 1977), then this transfer to the general reserves certainly related back to March 30, 1976. But, here, we are not concerned with the assessment year 1976-77 but with the balance-sheets of the earlier years, and for the purpose of the Surtax Act, we are to consider the position as on the first day of the relevant accounting period, i. e. , April 1, 1967, April 1, 1968 and April 1, 1974. The applicant could not seriously suggest that the recommendation of the directors on February 3, 1977, in respect of the accounts of 1975-76 financial year (which were passed in the annual general meeting held on March 31, 1977), will relate back to any period earlier to 1975-76 financial year. The position that emerges is that on the dates of the relevant balance-sheets, the appellant had undisclosed income not brought into the accounts. It was a mass of unappropriated profits to which the directors had no occasion to apply their mind as to what to do with it and for what future purpose it was to be set apart. As such, such concealed iucome was not a reserve for the purposes of the Surtax Act, following the ratio of the Supreme Court decision in the case of CIT v. Century Spg. and Mfg. Co. Ltd. In this connection, the Calcutta High Court order in the case of A P. V. Engineering Co. Ltd. v. CIT [1979] 119 1tr 937 may be referred to. " ( 8 ) THE surtaxe is imposed under the provisions of the Companies (Profits ) Surtax Act, 1964. Section 4 of this Act provides as follows ;" Charge of tax.--Subject to the provisions contained in this Act, there shall be charged on every company for every assessment year commencing on and from the first day of April, 1964, a tax (in this Act referred to as the surtax) in respect of so much of its chargeable profits of the previous year or previous years, as the case may be, as exceed the statutory deduction, at the rate or rates specified in the Third Schedule. " ( 9 ) WITH regard to the power of the Settlement Commission, it is to be borne in mind that the Settlement Commission is a creature of the statute, viz. , the Income-tax Act, A " case" before the Settlement Commission is defined in Section 245a (a) of the 1961 Act, which means any proceedings under the 1922 Act, or under this Act for and in connection with the assessment or reassessment of any person in respect of any year or years or by way of appeal or revision in connection with such assessment or reassessment which may be pending before an income-tax authority on the date on which the application under Sub-section (1 ). of Section 245c is made. Under Section 245h of the said Act, the said Settlement Commission has been conferred power to grant to such person, subject to such conditions as it may think fit to impose, immunity from prosecution for any offence under this Act or under the Indian Penal Code, 1860, or under any Central Act, for the time being in force, as also from imposition of penalty under the Income-tax Act with respect to the case covered by the settlement. From a reading of the relevant provisions of the Act, it is clear that the Income-tax Settlement Commission can pass an order confined to a case concerning the Income-tax Act or prosecution under any other Act in respect of the case or proceedings under the Income-tax Act. ( 10 ) THE balance-sheets under the relevant years were originally prepared in accordance with the provisions of the Companies Act, as mandatorily required to be done under the Companies Act and in the relevant balance-sheets, these undisclosed incomes had not been shown or disclosed. It was a mass of unappropriated profits to which the directors had no occasion to apply their mind as to what to do with it and for what future purpose it was to be set apart. The Settlement Commission allowed the petitioner-company to recast the balance-sheets filed by the appellant along with surtax details. The Income-tax Officer has made the assessment under the Surtax Act, on the basis of the returns and balance-sheets filed by the assessee which were prepared in accordance with the provisions of the Companies Act at the material time. The Settlement Commission allowed the petitioner-company to recast the balance-sheets filed by the appellant along with surtax details. The Income-tax Officer has made the assessment under the Surtax Act, on the basis of the returns and balance-sheets filed by the assessee which were prepared in accordance with the provisions of the Companies Act at the material time. A company is a creature under the provisions of the Companies Act and a company cannot be allowed to act in a manner inconsistent with the provisions of the Companies Act in so far as recasting of the balance-sheets already prepared is concerned. Such a balance-sheet prepared several years after the year in question to which such balance-sheet related cannot replace the original balance-sheet which was prepared in accordance with law and cannot alter the position. Balance-sheet, in an ordinary sense, means a statement of financial position of any company disclosing at a given moment of time its assets and liabilities in conformity with generally accepted accounting principles. There is no provision for recasting the balance-sheet once it is prepared, finalised and accepted in the annual general meeting. ( 11 ) THE Settlement Commission may pass any order for the purpose of giving relief to the petitioner-assessee in so far as penalty or prosecution is concerned under the Act. But it cannot pass any order travelling beyond the provisions of the Act nor can it indirectly pass an order by which the Income-tax Officer is bound to grant relief to the assessee under a different Act, namely, under the provisions of the Surtax Act. The provisions of the Surtax Act are not subject to any of the provisions of the 1961 Act. The charging section under the Surtax Act provides that, subject to the provisions contained in the Act, there shall be charged on every company for every assessment year commencing on and from the first day of April, 1964, a tax called surtax in respect of so much of its chargeable profits of the previous year or previous years, as the case may be, as exceed the statutory deduction, at the rate or rates specified in the Third Schedule to the Act. ( 12 ) UNDER Section 210 of the Companies Act, the balance-sheet as at the end of the period specified in Sub-section (3) of Section 210 has to be laid at every annual general meeting of the company. ( 12 ) UNDER Section 210 of the Companies Act, the balance-sheet as at the end of the period specified in Sub-section (3) of Section 210 has to be laid at every annual general meeting of the company. Before preparation of the balance-sheets, sums are allocated showing the income and expenditue. There is no provision under the Companies Act for revising the balance-sheet and/or recasting the balance-sheet as has been directed by the Settlement Commission. In any event, such a direction given by the Settlement Commission cannot enure to the benefit of the petitioner-company in respect of the assessment made or in respect of imposition of special tax on profits made under the provisions of the Surtax Act, which is a different Act. In the instant case, there had been some undisclosed income and search and seizure took place for the purpose of unearthing this undisclosed income. After the search and seizure took place, the petitioner-company moved the Income-tax Settlement Commission for a settlement under the provisions of Chapter XIXA of the Act. The power of the Income-tax Settlement Commission, in our view,js limited to granting immunity from prosecution and penalty as provided in Section 245h. It was contended by learned advocate appearing on behalf of the assessee that the order of the Settlement Commission is conclusive in view of the provisions of Section 245h. True, it may be conclusive so far as the authorities under the Act are concerned and binding on the authorities under the Act but certainly the order passed by the Settlement Commission cannot travel beyond the provisions of the Act and cannot bind the authorities under a different Act. There is no scope for overriding the provisions of other Acts when the provisions of Chapter XIXA of the Income-tax Act were not given any overriding effect. The Surtax Act does not provide that any order passed by any authority under the Income-tax Act would be binding. The mode of calculation of surtax, which is by way of a special tax on profits, is provided in the Surtax Act, and, in our opinion, the order passed by the Settlement Commission cannot affect the determination already made under the provisions of the Surtax Act. Similarly, under the provisions of the Wealth-tax Act, 1957, there are provisions for settlement of cases in Chapter VA of the Wealth-tax Act, where similar provisions have also been made. Similarly, under the provisions of the Wealth-tax Act, 1957, there are provisions for settlement of cases in Chapter VA of the Wealth-tax Act, where similar provisions have also been made. This is so because the Income-tax Act, the Wealth-tax Act and other Acts including the Surtax Act are independent statutes covering different fields and the orders are to be passed under the aforesaid Acts or within the four corners of those Acts. The contention of the learned advocate for the assessee that the order passed by the Settlement Commission in this regard should be given effect to after the assessments have already been made under the Surtax Act cannot be accepted. ( 13 ) THE settlement relates to three assessment years, viz. , 1974-75, 1975-76 and 1976-77, under Section 245c (I ). In our view, the Settlement Commission under the Income-tax Act cannot pass any order for waiving or reducing surtax liability payable under the provisions of the Surtax Act. ( 14 ) PART I of Schedule VI to the Companies Act refers to the form of the balance-sheet to which every company has to conform. It is in the background of a balance-sheet in this form that the directors of the company have to make a report to the shareholders as to "reserve" of the company under Section 217 of the Companies Act. The distinction between a "reserve" and a "provision" introduced in the Companies Act is not confined to Part III of Schedule VI. The distinction between a "reserve" and a "provision" is firmly established. "reserve" is for uncertain or unknown liability whereas "provision" is made for a known liability. ( 15 ) IN our view, it would have been wrong on the part of the Income-tax Officer to have accepted the balance-sheet modified by the order of the Settlement Commission which cannot be treated to be valid for the purpose of computation of capital under the Surtax Act. The Tribunal had acted correctly in sustaining the finding of the lower authority and holding that, on the dates of the relevant balance-sheets, the assessee had undisclosed income not brought into account and the same was a mass of unappropriated profits to which the directors had no occasion to apply their mind and as such the said amount could not be regarded as a reserve for the purpose of the Surtax Act. In our view, the Tribunal was also justified in sustaining the finding of the lower authorities and in rejecting the modified balance-sheets. ( 16 ) IN our view, the order of the Tribunal in this regard was not perverse, inasmuch as the same was decided correctly on the basis of proper materials and on correct principles of law. Accordingly, the first, third and fourth questions are answered in the affirmative and in favour of the Revenue. The second question as well as the fifth question are answered in the negative and in favour of the Revenue. There will be no order as to costs.