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2017 (4) TMI 973 - HIMACHAL PRADESH HIGH COURT

2017 (4) TMI 973 - HIMACHAL PRADESH HIGH COURT - TMI - Penalty us 271(1))(c) - Commission of offence under Sections 276 (CC) read with Section 278 (B) - Held that:- As the accused persons have not willfully delayed the filing of the return and the deposit of tax and also as the accused were not given any notice before giving sanction, this Court finds that prosecution has failed to prove the guilt of the accused persons beyond the shadow of reasonable doubt. - It has been held in K. Prakasha .....

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URT) has held that where two views are reasonably possible from the very same evidence, prosecution cannot be said to have proved its case beyond reasonable doubt. - In view of the above discussion, the prosecution has failed to prove the guilt of the accused conclusively and beyond the scope of reasonable doubt. The findings of the learned Court below are not required to be interfered with. Thus,the present appeal, being devoid of merits, deserves dismissal and is accordingly dismissed. - C .....

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ed as ACIT Vs. Janeshwar Lal Rajeshwar Lal & others, whereby the learned Chief Judicial Magistrate, Shimla acquitted the respondents for the commission of offence under Sections 276 (CC) read with Section 278 (B) of the Income Tax Act. At the very outset, it is necessary to mention that respondent No. 2 Rajeshwar Lal had expired when the appeal was pending before this Court and vide order dated 30.11.2016, he has been deleted from the array of respondents. Now the appeal is surviving against .....

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r the acts of accused No. 1. 3. As per the appellant, on the notice of the complaint, the accused put in appearance. The complainant was then asked to lead pre-charge evidence. Accordingly, the complainant examined Hari Ram as PW-1 and B.S. Pathania as PW-2. Upon consideration, all the accused were charged for the commission of offences punishable under Section 276 (CC) read with Section 278 B of the Income Tax Act to which they pleaded not guilty and claimed trial. Upon the request of the accus .....

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Thereafter, an application under Section 311 of Cr. P.C. was moved by the prosecution for examination of Shri Rajesh Katoch, Assistant Commissioner, Income Tax, which was allowed and said witness was examined as PW-3. The accused were then reexamined, under Section 313 Cr. P.C., on 14.9.2006. However, their defence remained similar that due to illness of accused No. 2, Rajeshwar Lal Jain, the return for the period aforesaid could not be filed in time. 4. Learned counsel for the appellant has ar .....

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the prosecution has failed to prove the guilt of the accused, including the mens rea on their part of delay in filing the return. However, the Commissioner, as required under law, never issued any notice compounding the offence before giving the sanction to prosecute, that too after 10 years. He has argued that the present appeal deserves dismissal, as there is nothing to suggest that interference of this Court is required. 6. To appreciate the arguments of learned counsel for the parties, I hav .....

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er accused were the sleeping partners and due to this reason, the return could not be filed in time. The evidence, as led by the parties, is required to be discussed in short, in order to appreciate the fact whether the return was delayed intentionally or for the reasons beyond the control of the accused persons. 9. It has been admitted by PW-3 Rajesh Katoch, Assistant Commissioner of Income Tax that he was Income Tax Officer, Ward No. 1, Shimla, during the year 1994. He had issued notice, Ex. P .....

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defence examined Sh. K.B. Sharma, Senior Assistant, H.P. High Court as DW-1, who has proved on record copy of reference, Ex. DW1/A, copy of orders, Ext. DW1/B to Ex. DW1/H, Ext. DW1/J to Ex. DW1/M and copy of letters, Ext. DW1/N to Ex. DW1/O claiming that the said documents are the art of reference, Ext. DW1/A. 11. Accused have also examined Shri Rajan Kumar of the Medical Cardiology Department, All India Institute of Medical Sciences, New Delhi, who has claimed that OPD Record pertaining to Sh .....

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een extracted from his cross-examination. Certainly, the record with All India Institute of Medical Sciences could not be manufactured by the accused. Hence, the explanation of the accused is plausible that they were prevented by a sufficient and reasonable cause for not filing the return in time. 12. The have also examined Shri Dev Datti Dass Gupta as DW-3, who too has stated that from 1973 to 1988, he was posted as HOD of the Medicine Department, IGMC, Shimla. According to him, he was known to .....

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hospital in the CCU ward for coronary artery heart disease. According to him, patients suffering from such a disease are unable to do hard work. He too has been crossexamined, but without any assistance. It is, therefore, apparent that accused No. 2 was suffering from aforesaid disease and was unable to undertake hard work and since he only was maintaining the accounts of the accused No. 1, firm qua filing the returns, certainly it was not possible for him or to other accused persons to file the .....

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fficient for us to refer to Section 271(1)(a), which provides that penalty may be imposed if the Income tax Officer is satisfied that any person has, without reasonable cause, failed to furnish the return of total income, and to Section 276 C which provides that if a person willfully fails to furnish in due time the return of income required under Section 139(1), he shall be punishable with rigorous imprisonment for a term which may extend to one year with fine. It is clear that in the former ca .....

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lty should serve as a deterrent. The creation of an offence by statute proceeds on the assumption that society suffers injury by the act of omission of the defaulter and that a deterrent sentence must be imposed to discourage the repetition of the offence. In the case of a proceeding under Section 271(1)(a), however, it seems that the intention of the Legislature is to emphasise the fact of loss of revenue and to provide a remedy for such loss, although no doubt an element of coercion is present .....

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n Corpus Juris Secundum, Volume 85, Page 580, paragraph 1023. 15. The Hon ble High Court of Andhra Pradesh in Income Tax Officer versus Autofil and others, ITR Vol. 184 (1990) 47 has held as under: Conviction under Section 276 CC is an extreme and exceptional resort and gets warranted only when willfulness in failure to submit the return in time is established beyond all reasonable doubt and there should be the presence of mens rea, a bad motive and a guilty mind. In the absence of this, no conv .....

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from criminal liability. I, accordingly, find no merit in these appeals. The appeals are, therefore, dismissed. 16. The Hon ble High Court of Calcutta in Dunlop India Ltd and others versus Arun Chandra Sinha, Assistant Commissioner of Income-Tax and others, ITR Vol. 211 (1995) 79 has held as under: The person accused would be deprived of the benefit or right of compounding the offence before the initiation of proceedings, if the prosecution were launched without any prior notice. In addition, I .....

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