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2015 (12) TMI 202 - DELHI HIGH COURT

2015 (12) TMI 202 - DELHI HIGH COURT - [2016] 382 ITR 418 - Undisclosed income - the petitioner sought staying of the criminal proceedings against him on the ground that against the Assessment Order (‘AO’), the petitioner had already filed an appeal, which is pending for adjudication - Held that:- Proceedings once initiated in a warrant trial case, there is no provision under the Code of Criminal Procedure, 1973, except U/s 258 Cr.P.C., where the proceedings of the case can be stayed by the Magi .....

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he Income Tax Department. The said foreign account was the undisclosed account and the deposits therein relates to his undisclosed income and the same needs to be examined. Therefore, there is no illegality, infirmity or perversity in the order dated 19.02.2015 passed by the learned Trial Court that pendency of appellate proceedings has no bearing in initiation of prosecution under the Income Tax Act. Thus, finding no merit in the instant petition, the same is hereby dismissed. - CRL.M.C. 2467/2 .....

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te (ACMM) (Central), Tis Hazari Courts, Delhi. 2. Vide the aforesaid application, the petitioner sought staying of the criminal proceedings against him on the ground that against the Assessment Order ( AO ), the petitioner had already filed an appeal, which is pending for adjudication. 3. Mr. Ganesh, learned senior counsel appearing on behalf of the petitioner argued that the complaint case filed by the respondent/Income Tax Department is liable to be quashed on the ground that at the time of fi .....

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complaint and as per Circular dated 07.02.1991 issued by the Central Board of Direct Taxes, no prosecution can be initiated against a person who is above the age of 70 years. 5. Learned senior counsel further argued that case against the petitioner is that he concealed his income and did not file income tax accordingly. The said complaint was filed on the allegation that the petitioner had filed his original return of income in the prescribed form duly signed and verified by him for Assessment .....

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ion, Income Tax Department, New Delhi, the petitioner stated that he had an account outside India, which is as per FEMA Regulations, through his AR Abhay K. Aggarwal. To verify the details of the said foreign bank account in the name of the petitioner and the source of the deposits, summon under Section 131 (1A) of the Income Tax Act, 1961 ( IT Act ) dated 02.09.2011 was issued to the petitioner. Having knowledge qua start of the inquiries with regard to the source of funds deposited by the peti .....

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posits made by him in the foreign bank account, copy of the letter is annexed as Annexure-J. 6. The petitioner vide letter dated 14.10.2011 admitted that the amount lying in the foreign bank were about US$40,000 and US$32,12,000 in the Financial Year ( FY ) 2005-06 and 2006-07, relevant to AY 2006-07 and 2007-08. Copy of the same is annexed as Annexure-K. 7. Learned senior counsel further submitted that since the petitioner has challenged the AO in the appeal and the same is pending for adjudica .....

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is no impediment in law for the criminal proceedings to proceed even during the pendency of the proceedings under the Act. However, a wholesome rule will have to be adopted in matters of this nature where courts have taken the view that when the conclusions arrived at by the appellate authorities have a relevance and bearing upon the conclusions to be reached in the case necessarily one authority will have to await the outcome of the other authority. xxxx xxxx xxxx In the present case, there is .....

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ons. 9. On the other hand, Mr. Rahul Chaudhary, learned senior standing counsel appearing on behalf of the respondent Department submitted that the petitioner has not approached this Court with clean hands and has tried to mislead this Court by stating that Instruction No.5051/1991 dated 07.02.1991 mandates that no prosecution could be initiated against a person who is above the age of 70 years, conveniently leaving out the expression at the time of commission of offence . He submitted that the .....

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of 70 (at the time of commission of offence). Further submitted, the instructions are in the nature of broad guidelines which should be kept in mind while initiating proceedings and provide for greater stress in initiation of prosecution proceedings in case of offences involving tax frauds, fabrication of evidence and major defaults. 10. Learned counsel further submitted that admittedly, date of birth of the petitioner is 02.11.1942. As on 28.07.2006 and 31.07.2007, i.e., the date of filing of .....

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age of 70 years at the time of commission of offence as provided. 11. Learned counsel submitted that in reply to the application filed by the petitioner, the Department stated that at the time of filing of Complaint No.70/04, the petitioner had not filed any appeal in respect of the AO, subject matter of said complaint, however, the same had been filed as an afterthought with a view to thwart the criminal proceedings pending against him. It was further stated that even the appeal has been filed .....

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hat as per Circular dated 07.02.1991, no prosecution can be initiated against a person who is above the age of 70 years. 14. Since the aforesaid order dated 02.11.2011 was passed by this Court only, therefore, it can authoritatively be said that the said order was not passed on merits, however, based on the precise statement made by the learned counsel for the Department. The fact remains that Instruction No.5051/1991 dated 07.02.1991 states as under:- 4. Prosecution need not normally be initiat .....

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the present petitioner. 16. In the impugned order, the learned Trial Court has recorded that both the complaints have been filed under Sections 276C (1), 276D & 277 IT Act. The grounds of appeal and statements of facts clearly establish that there was no ground in either of the appeal in respect of the offence U/s 276D IT Act. The appeal had been filed challenging the AO and consequential outcome of imposition of penalty U/s 271(1) (c) IT Act. Thus, at any count, the outcome of the appeal fi .....

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at pendency of appellate proceedings has no bearing in initiation of prosecution under the Income Tax Act. The relevant portion is extracted as under for ready reference. 30.....If it was the intention of the legislature to hold up the prosecution proceedings till the assessment proceedings are complete by way of appeal or otherwise the same would have been provided in Section 276CC itself. Therefore, the contention of the learned Senior Counsel for the appellant that no prosecution could be ini .....

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