(1)   The Commission may, before disposing of any application filed under subsection (1) or sub-section (1A) of section 138D, call for such particulars as it may require in respect of the case in the application brought before it or cause further enquiries to be made by the Commissioner and on the basis of his report and having regard to the nature and circumstances of the case, the Commission may, by order, allow the application to be proceeded with or reject the application:

Provided that an application shall not be rejected under this subsection unless an opportunity has been given to the applicant of being heard.

(2)   Notwithstanding anything contained in sub-section (1), an application shall not be proceeded with under that sub-section if the Commissioner objects to such application on the ground that concealment of particulars of income on the part of the applicant or perpetration of fraud by him for evading any tax under this Ordinance, has been established or is likely to be established by any income tax authority:

Provided that where the Commission does not agree with the objections raised by the Commissioner, it may, after giving the Commissioner an opportunity of being heard, accept the application for being proceeded with under sub-section (1).

(3)   Where an application is allowed to be proceeded with under subsection (1), the Commission may call for the relevant records from the Commissioner and after examination of such records, if the Commission is of the opinion that any further inquiry in the matter is necessary, it may direct the Commissioner to make or cause to be made such further enquiry and furnish a report on the matters within such time as it may fix.

(4)   After examination of the records and the report of the Commissioner received under sub-section (1) or sub-section (3), and after giving an opportunity to the applicant and to the Commissioner to be heard, in person or through their authorised representatives and after examining such further evidence as may be placed before it or obtained by it, the Commission may, in accordance with the provisions of this Ordinance, pass such order as it thinks fit on the matters enumerated in the application and reported to it by the Commissioner under sub-section (1) or sub-section (3).

(5)   Every order passed under sub-section (4) shall provide for the terms of settlement including any demand of tax, penalty or interest, the manner in which any sum due under the settlement shall be paid and all other matters to make the settlement effective and shall also provide that the settlement shall be void if it is subsequently found by the Commission that it has been obtained by fraud or misrepresentation.

(6)   Where a settlement becomes void the proceedings with respect to the matters relating to the settlement, shall be revived from the stage at which the application was allowed except a matter pending in appeal or revision before making an application under sub-section (1) of section 138D, to be proceeded with and the concerned income tax authority may, notwithstanding anything contained in any other provision of this Ordinance, complete such proceedings within two years from the end of the financial year in which the settlement became void.

(7)   The Commission may, if it is of the opinion that any person who made an application under section 138D does not cooperate with the Commission in the proceedings before it, send the case back to the assessing officer, if such case was pending for assessment at the time application under that section was made, who shall thereupon dispose of the case in accordance with the provisions of this Ordinance as if no application under section 138D had been made.