In search proceedings it was found that the assessee had failed to maintain any proper books of account in accordance with accounting practice and had filed returns of income based on notional value, that the entire business was predominantly in cash, that sales were suppressed and expenses under-reported. Therefore, sales for the period from the financial year 2008-09 were worked out by reverse working the sales for each of the outlets from the date of the commencement of business operation at each of the outlet, giving 15 per cent. allowance for each of the assessment years 2010-11 to 2014-15 and the net profit was computed at around Rs. 22 crores. The assessee admitted a sum of Rs. 4 crores as undisclosed income. The Director (Inv) initiated criminal proceedings under section 277 on the grounds that the assessees had wilfully under-reported the income by filing false and incorrect returns of income thereby evading tax. The assessee filed the petition before the Settlement Commission which was allowed and order under section 245D(4) read section  245I was passed.   The assessee filed    criminal petitions to quash the proceedings initiated by the Director (Inv).   Dismissing the petitions, the Court held that  the assessee had filed an application before the Settlement Commission under section 245C of the Act, on January 22, 2018 whereas the prosecution was initiated two years before that, on November 17, 2016 itself. Therefore, the provisions under section 245-I of the Act were not applicable. The factum of pending prosecution was not brought to the notice of the Settlement Commission and the assessees had obtained immunity in respect of prosecution. That apart, as against the immunity granted by the Settlement Commission, the Department had filed an appeal and it was pending before the Board. Therefore, the criminal proceedings were not to be quashed.(AY.2010-11 to 2014-15)