TMI Blog1997 (2) TMI 25X X X X Extracts X X X X X X X X Extracts X X X X ..... May 21, 1980, a search was conducted by the income-tax officials at the business and residential premises of the petitioner. During the said search it was found that the petitioner had omitted to record certain transactions in his account books. The petitioner claimed that with a view to purchase peace and to avoid protracted litigation with the Department he was advised to settle the dispute with the then Income-tax Commissioner, Kanpur. Accordingly, the petitioner surrendered a sum of Rs. 35,000 to be added towards the income for the assessment year 1980-81, Rs. 20,000 for the assessment year 1979-80. For the assessment year 1978-79 the petitioner filed return of income showing an income of Rs. 35,000. His income was, however, assessed t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sion for the Income-tax Officer to initiate any criminal penal action against the petitioner. Further it was contended on behalf of the petitioner that the offence being compoundable and the prosecution having been launched without offering an opportunity of being heard and to compound the matter, as was contemplated by the provisions of sub-section (2) of section 279 of the Income-tax Act, before or after the institution of the proceedings, the criminal prosecution initiated against the petitioner was bad in law. The provisions of sub-section (2) of section 279 read as under "Any offence under this Chapter may, either before or after the institution of proceedings, be compounded by the Chief Commissioner or a Director-General." Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... explain that the errors and omissions, if any detected by the income-tax authorities during the raid of the premises of the petitioner, were the results of willful default coupled with criminal intention to evade tax. Under the circumstances, I hold that the approach of the income-tax authorities in instituting the criminal complaints against the petitioner was bad in law and amounted to abuse of the process of the court. These petitions therefore, deserve to be allowed and the various criminal complaints before Criminal Complaints Nos. 99 of 1988, 94 of 1988, 97 of 1988 and 98 of 1988-Union of India through V B. Mishra, Income-tax Officer, Circle 1(5), Kanpur v. Banwari Lal Agarwal are hereby quashed. - - TaxTMI - TMITax - I ..... X X X X Extracts X X X X X X X X Extracts X X X X
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