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2024 (2) TMI 1284 - HC - Income TaxOffence u/s 276CC - petitioner prime facie found that the non-filing of the return was wilfull - Economic Offences - petitioner submitted that there was no wilfulness on the part of the petitioner in not filing the returns and that the petitioner had Tax Deducted at Source standing to his credit which covers the entire income earned by the petitioner during the relevant point of time and mere delay in filing the income tax returns due to ill health should not result in a prosecution - HELD THAT:- The only criterion for initiation of prosecution is that there must be a wilful failure to furnish returns as required under Section 139(1) of the Act and once that requisite is fulfilled, the statutory presumption under Section 278E starts operating and this provision brings in a statutory presumption with regard to the existence of a culpable mental state. At this stage, the Court can only presume the culpable mental status of the petitioner and the onus is upon the petitioner to prove the contrary and that can be done only at the time of the trial. There is no dispute with regard to the fact that the petitioner did not file the returns under Section 139(1) of the Act for the Assessment Year 2014-2015 on or before 31/07/2014. The petitioner for the first time, reacted only after notice u/s 148 of the Act was issued to him. It must be borne in mind that the notice u/s 148 of the Act has nothing to do with the return of income to be filed u/s 139(1) of the Act.There is no connection between the notice issued u/s 148 of the Act and the duty of the assessee to file the returns under Section 139(1) of the Act. it is not as if the petitioner has paid the tax and there was only a delay in filing the returns. The petitioner cannot assume that the Tax Deducted at Source will cover the entire tax liability for the relevant Assessment Year even without filing his returns and declaring his total income. As petitioner submitted that an appeal has been filed against the assessment order and the same is pending before the appellate authority and therefore, the prosecution cannot be continued, there is no basis for this submission and the mere pendency of the appellate proceedings is not a relevant factor for initiating prosecution proceedings u/s 276CC. Useful reference can be made to the judgment of the Apex Court in Sasi Enterprises v. CIT [2014 (2) TMI 19 - SUPREME COURT] In the instant case, the trial has already commenced and this is yet another reason as to why this Court is not inclined to interfere with the criminal proceedings which was initiated in the year 2017. Therefore, it is left open to the petitioner to raise all the grounds before the Court below and the same will be considered on its own merits and in accordance with the law. Any finding rendered in this Order will not have any bearing on the trial court while dealing with the issues involved in the case. This Criminal Original Petition stands dismissed and there shall be a direction to the Court below to complete the proceedings in E.O.C.within a period of three months from the date of receipt of copy of this Order.
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