Payment of tax, penalty or interest under s 276C Income Tax Act, 1961. - Income Tax - 1083/CBDT

INSTRUCTION NO. 1083/CBDT Dated : August 6, 1977 Section(s) Referred: 276C Statute: Income - Tax Act, 1961 Under section 276C(2) of the Income-tax Act, 1961 inserted by Section 67 of the Taxation Laws (Amendment) Act, 1975, wilful attempt in any manner whatsoever to evade payment of any tax, penalty or interest under the I.T.Act, 1961 has been added, inter alia, to the list of offences which will attract prosecution. The prosecution will lie without prejudice to any penalty that may be imposable under any other provision of the Act. The Explanation to Section 276(2) is in the following terms:- "Explanation- For the purposes of this section, a wilful attempt to evade any tax, penalty or interest chargeable or imposable under this Act or the payment thereof shall include a case where any person- (i) has in his possession or control any books of account or other documents (being books of account or other documents relevant to any proceeding under this Act) containing a false entry or statement; or (ii) makes or causes to be made any false entry or statement in such books of account or other documents; or (iii) wilfully omits or causes to be omitted any relevant entry or statement in such books of account or other documents; or (iv) causes any other circumstance to exist which will have the effect of enabling such person to evade any tax, penalty or interest chargeable or imposable under this Act or the payment thereof." A similar provision for prosecution for wilful attempts to evade payment of any tax, penalty or interest under the W.T.Act has also been made u/s.35A(2) of the Wealth-tax Act, inserted by Section 100 of the Taxation Laws (Amendment) Act, 1975. The provisions of both sections 276C(2) of the Income-tax Act and 35A(2) of the Wealth-tax Act may be invoked in respect of an assessee's wilful attempt to evade payment of tax after 1.10.75. 2. Under the existing instructions, prosecutions for offences under the various Direct Taxes Acts and/or I.P.C. require the Board's prior administrative approval. All the cases in which recovery of taxes has been deliberately thwarted by assessees and submit formal proposal to the Board for prosecution, wherever justified on the facts are to be examined. Scrutiny of cases involving arrears of tax exceeding Rs.5 lakhs in the aggregate as on 1.8.77 should be undertaken immediately. Your report on the results of scrutiny should be sent to the Board by 15.9.77. Formal proposals for the Board's approval may be sent in these cases by 30.11.77.