1994 (1) TMI 37 - HC - Income Tax

High Court Income Tax Act Offences And Prosecution Reference Pending Wilful Attempt To Evade Tax

Summary

Issues:
Challenge of prosecution under section 276C of the Income-tax Act, 1961; Continuance of two separate proceedings against the petitioners leading to double jeopardy; Relevance of civil court decision in a criminal prosecution; Legality of initiating criminal proceedings while other proceedings under the Act are pending.

Analysis:
The petitioners contested their prosecution under section 276C of the Income-tax Act, 1961, after a series of events involving assessment orders and appeals. The Income-tax Officer initiated criminal proceedings against the petitioners under sections 276, 277, and 278 of the Act, leading to the framing of charges. The petitioners sought to quash the proceedings, arguing that facing both civil and criminal proceedings simultaneously would amount to double jeopardy and harassment. However, the Union of India contended that both proceedings were independent, with the burden of proof lying on the prosecution in the criminal case. The court emphasized the distinction between civil and criminal law, highlighting the need for independent findings in criminal proceedings despite the relevance of civil court decisions. The judgment cited a Supreme Court case to support the principle that the pendency of proceedings under the Income-tax Act does not bar the initiation of criminal proceedings under sections 276 and 277. The court held that the standard of proof and the nature of the two proceedings being different, the criminal prosecution should not be quashed merely due to pending civil proceedings. Consequently, the petition was dismissed, directing the petitioners to appear before the trial court without further notice.