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Assistant Commissioner of Income Tax Versus M/s Janeshwar Lal Rajeshwar Lal & others

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. Prakashan vs. P.K. Surenderan (2007 (10)551 - SUPREME COURT) th .....

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he 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. - Cr. Appeal No. 166 of 2008 - Dated:- 19-4-2017 - Chander Bhusan Ba .....

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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 respondent No. 1, 3, 4 and 5. 2. Briefly stated the facts giving .....

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ce 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 accused, the witnesses of the prosecution, who had been examined at th .....

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ed 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 argued that the learned Court below has committed illegality in acq .....

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luding 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 have gone through the record carefully. 7. From the record, it is cl .....

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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. PW3/A, on 17.1.1994. The said notice was replied by accused No. 2 .....

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urt 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 Shri Rajeshwar Lal Jain (accused No. 2) of OPD No. CV6577, dated 9. .....

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ith 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 Dr. A.N. Mahrotra, who too retired from IGMC, Shimla in the year .....

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ding 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 return in time. 13. The appellant had remained unable to sustain .....

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t 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 case what is intended is a civil obligation while in the latter wha .....

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atute 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 in the penalty. In this connection, the terms in which the penal .....

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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 conviction shall follow the prosecution under Section 276 CC of the I .....

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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 respectfully adopt the reasoning of the Karnataka High Court in .....

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