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2022 (7) TMI 966 - HC - Income TaxProsecution proceedings u/s 276CC - failure to file ITR in time - Violation of Section 276-CC read with Section 278-B - manadation of seeking valid sanction u/s 278B - As per DR Assessee company not filed the Income Tax Returns (ITR) for the assessment year 2012-13 by 30th September, 2012 which was the last date to file the ITR - HELD THAT:- In the present case, the sanction which is placed on the record as Annexure P-9 may be seen. It refers to the Company M/s ASM Traxim Pvt. Ltd as the “assessee”. It refers to a response to the show cause notice under Section 276 CC dated 20th March, 2014 vide a letter dated 25th March, 2014 by Mr. B.L. Gupta ITP on behalf of the “assessee company”, contending that the return had been filed within time allowed u/s 139(4) and that there was no willful default. It refers to the petitioner only in para no.10 in the following words, “AND WHEREAS it is seen that the return of income was verified by Sh Vipul Agarwal director by digital signature”, and nothing more. Thus, the sanction is specifically to institute a criminal complaint against the Company M/s ASM Traxim Pvt Ltd. It is crystal clear that the sanction has been accorded for the prosecution only of the “person” named as the “assessee”, namely the Company M/s ASM Traxim Pvt. Ltd. There is no sanction qua the petitioner, even as a “person” being a director/being responsible to the conduct of the business of the company. It cannot be held that the observation in para no.10 of this sanction, that the petitioner had verified the returns filed by appending his digital signatures, would tantamount to sanction qua him. That would be stretching language too far. Since the law provides that without sanction u/s 278B of the IT Act, the Department cannot proceed against a person found liable to prosecute him for the offence under Section 276 CC of the IT Act, the present prosecution must fail qua the petitioner. In the absence of a specific sanction for prosecuting the petitioner, the learned ACMM could not have taken cognizance of the complaint against him and then framed charge against him. The edifice built without foundation must crumble. The complaint and all proceedings emanating therefrom, including the impugned orders qua the petitioner Vipul Aggarwal, stand quashed. WP allowed.
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