TMI Blog1995 (3) TMI 22X X X X Extracts X X X X X X X X Extracts X X X X ..... rs under section 276B read with section 194A/200 of the Income-tax Act, 1961, and rule 30 made thereunder read with section 278B of the Income-tax Act, 1961 (hereainafter referred to as " the Act "). The core of allegations made in the complaint are that the petitioners did not deduct the income-tax at source for the years 1982-83 and 1983-84, thus making themselves liable for punishment under section 276B of the Act. It is, however, not disputed that the petitioners later did deduct the required tax on February 20, 1985, and deposited the same on the same date. It is also not disputed that by the time tax was deducted and deposited as referred above, no prosecution had so far been launched against the petitioners. In fact, the complaint af ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion of the officer concerned depending upon the facts and circumstances of each case whether the prosecution should be launched or not. Before any comments on the merits of the points canvassed by learned counsel for the petitioners are made, it shall be useful to see the relevant instructions. The same read thus : " The prosecution under section 276B should not normally be proposed when the amount involved and/or the period of default is not substantial and the amount in default has also been deposited in the meantime to the credit of the Government. No such consideration will, of course, apply to levy of interest under section 201(1A). " The words " not normally " precede the words " be proposed when the amount involved and/or the p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion in the relevant provisions of the statute and the instructions quoted above. The relevant provision of the statute no doubt talks of prosecution but the instructions in the considered view of the court provide an exception in limited matters and that too where the conditions precedent in the instructions are available or in existence. Mr. Sawhney relied upon Jagmohan Singh v. ITO [1992] 196 ITR 473 (P H) ; Madura Chit and Investments Pvt. Ltd. v. ITO [1994] 208 ITR 228 (Mad) and Kerala Financial Corporation v. CIT [1994] 210 ITR 129 (SC). These judgments are for the proposition that where there is conflict between the provisions of the statute and the rules or the rules and the instructions, it is provisions of the statute and the rul ..... X X X X Extracts X X X X X X X X Extracts X X X X
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