TMI Blog2006 (11) TMI 133X X X X Extracts X X X X X X X X Extracts X X X X ..... to as "the Act"), against M/s. Dayagen others. The petitioner herein is arraigned as accused No. 4 in the said complaint. The matter relates to the assessment year 1988-89 and the allegation in the complaint is that the accused persons failed to file the return for the assessment year 1988-89 as required under section 139(1) of the Act. M/s. Dayagen was a partnership firm, which is made accused No. 1. Accused Nos. 2 to 7 were the partners of M/s. Dayagen. At the time of filing of the complaint, M/s. Dayagen was no longer a partnership firm but became sole proprietorship concern of Mr. V. P. Punj (accused No. 8) and, therefore, he is also made an accused. Qua him it is further alleged that he is associated with the firm since March, 1988, and was actively participating in the functioning of the firm since then. It is alleged that for the year 1988-89 the firm was required to file the return on or before June 30, 1988, as required under section 139(1) of the Act. It was not filed and instead Form No. 6 was filed on December 30, 1988, seeking extension of time up to March 31, 1989. This request was rejected and the same was conveyed to the accused persons, vide order dated January ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been dismissed by the learned ASJ, vide the impugned order dated July 7, 2004, and challenging the said order, these petitions are filed under section 482 of the Code of Criminal Procedure invoking the extraordinary jurisdiction of this court. 3. Before adverting to the impugned order passed by the learned ACMM, let me state here the facts, on the basis of which it is claimed by the petitioners that they ceased to be partners in the firm with effect from August 7, 1987. All the accused persons are related to each other and are family members. It appears that there were some disputes regarding family properties and business and, for deciding these disputes, the matter was referred to arbitration. The family members were divided into groups. The petitioners belonged to group No. 1, which consisted of 14 members, whereas Mr. V. P. Punj (accused No. 8) and his family members were in group No. 2, which had 12 members and in group No. 3 was Mrs. Dayawanti Punj, the mother of accused Nos. 4 and 8. Award dated August 6, 1987, was rendered by the learned arbitrator dividing all the assets, residential and commercial,. including business, among the three groups. In so far as the bus ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erently, if the court were to think that the accused might have committed the offence it can frame the charge, though for conviction the conclusion is required to be that the accused has committed the offence. It is apparent that at the stage of framing of charge, probative value of the materials brought on record by the prosecution has to be accepted as true at that stage………. In my opinion, the magistrate shall frame a charge if after (i) considering the police report and documents referred to in section 173, (ii) examining the accused, if necessary, and (iii) hearing the arguments of both sides he thinks that there is a ground for presuming that the accused has committed an offence triable by him as a warrant case which he is competent to try and adequately punish. The basis for such a presumption would be a consideration of the police report and documents and the circumstances of the case supplemented by the examination of the accused, should it be necessary. The magis trate has to apply his judicial mind and mindfully adverting to the material on record for considering whether or not there is a ground for presuming the commission of the offence by the accused. He must not aut ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dence, PW1 Sh. Roshan Sahai has stated that the revisionists were persons in-charge of and responsible for the firm for the conduct of the business. He further stated that the return of income of the firm was not filed within the prescribed time as required under section 139(1) of the Act. He further stated that the notices were sent and reply on behalf of the firm was received and he had also issued notices to the accused firm under the Act asking them to furnish the return of income as well as asking them to furnish the copies of profit and loss accounts, balance-sheets, auditor's report as well as their books of account to enable him to comply the assessment. He further stated that despite service of the notices and letters, the return or income was not filed. He further stated that a show-cause notice was also sent as to why the prosecution should not be launched for non-filing of return of income. The accused furnished the names of the partners as well as details of the company account vide their letter dated February 11,1991. He further deposed that accused Nos. 2 to 7 were actively involved into the day-to-day affairs of the firm. In the cross examination nothing materia ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed upon by the petitioners at the time of arguments before the learned ASJ, he failed to consider the impact thereof. It was also argued that accused No. 4 was, in fact, more than 75 years of age besides being sick and as per Circular dated February 7, 1991, the prosecution could not have been initiated against him. It was also submitted that in any case the courts below failed to consider or appreciate that the alleged offences are compoundable but no opportunity was given to the petitioners to exercise any such right as per the guidelines for compounding issued by the Government. Learned counsel also submitted that for the assessment year 1988-89, the Revenue has charged the interest under section 139(8) of the Act for late filing of return by M/s. Dayagen in the complaint filed by the respondent. When the Revenue levies interest under section 139(8), it must be presumed that the Revenue has extended the time for filing the return beyond the prescribed period after satisfying that it is a case for extension of time. Therefore, no criminal prosecution can be launched or continued after charging the interest under section 139(8) as it is an implied extension of time to file the ret ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the subject- matter of the award dated August 7, 1987. Prosecution against the said company was also launched on the same ground and under the same provisions, namely, for non-filing of the return for the assessment year 1988-89. As per the award, this company had also fell into the share of group No. 2 and persons belonging to group No. 1 had, on the basis of the said award, challenged the prosecution launched against them and submitted that they were not responsible for the affairs of the company. In so far as the plea based on the award dated August 7, 1987, is concerned, the Division Bench categorically stated that it was not going into that aspect as it relates to the defence of the petitioner, meaning thereby that such a defence based on facts could be gone into only at the stage of trial. However, the petition was allowed on the ground that nothing was stated in the complaint which would indicate as to how the said directors (petitioners thereon belonging to group No. 1, as in the instant case) were in-charge of the affairs of the company. The order passed is brief and it would be apposite to reproduce the same in entirety: "Rule D.B. The petitioners herein are being pro ..... 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