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TMI Blog1984 (12) TMI 13X X X X Extracts X X X X X X X X Extracts X X X X ..... ed a statement of profit and loss account for the year ending March 31, 1977, and trial balance as on March 31, 1977. The profit and loss account showed a collection of Rs. 14,89,681 for the year ending March 31, 1977. Subsequently, on March 14,1978, a raid on the premises of his office and residence was made by the Income-tax authorities resulting in the seizure of more than one set of account books maintained by the petitioner in respect of his film business for the assessment year 1977-78, and a sum of Rs. 50,000 in cash. The scrutiny of the accounts seized showed discrepancies and suppression of the collection made by the petitioner in his film business and he was called upon to explain. This prompted the petitioner to Me a revised return for the assessment year 1977-78 showing a total income of Rs. 2,36,240 as against the income of Rs. 1,03,740 originally returned by him. On November 15, 1979 an order of assessment was passed by the Income-tax Officer for the year 1977-78, determining the total income of the petitioner at Rs. 3,29,964. On appeal, the Commissioner of Income-tax (Appeals), Madras, confirmed the assessment. On further appeal, the Income-tax Appellate Tribunal det ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e taken. The Income-tax Officer did not accept even the revised return as correct, and determined the total income at Rs. 3,23,840. The petitioner filed an appeal before the Commissioner of Incometax (Appeals), but it was rejected. However, the Income-tax Appellate Tribunal allowed the appeal and determined the total income of the petitioner at Rs. 2,34,233 which was less than the amount of Rs. 2,36,240 shown by the petitioner in his revised return. The Tribunal also observed that there was no justification to assume that the petitioner had maintained duplicate or triplicate set of accounts for the assessment year 1977-78. Though the Income-tax Appellate Tribunal allowed the appeal and accepted the revised return filed by the petitioner, the Income-tax Officer initiated penalty proceedings against the petitioner and levied a penalty of Rs. 2,17,910 under section 271(1)(c) of the Income-tax Act. On appeal, the Commissioner of Income-tax directed the Income-tax Officer to levy the minimum penalty under the Act taking into account the income accepted by the Income-tax Appellate Tribunal. Notwithstanding the aforesaid proceedings, the respondent, the Income-tax Officer, has now initiat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... hall, without prejudice to any penalty that may be imposable on him under any other provision of this Act, be punishable, (i) in a case where the amount sought to be evaded exceeds one hundred thousand rupees, with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine ; (ii) in any other case, with rigorous imprisonment for a term which shall not be less than three months but which may extend to three years and with fine ...... Explanation. -For the purposes of this section, a wilful attempt to evade any tax, penalty or interest chargeable or imposable under this Act or the payment thereof shall include a case where any person (i) has in his possession or control any books of account or other documents (being books of account or other documents relevant to any proceeding under this Act) containing a false entry or statement; or (ii) makes or causes to be made any false entry or statement in such books of account or other documents; or (iii) wilfully omits or causes to be omitted any relevant entry or statement in such books of account or other documents ; or (iv) causes any other circumstances to exist which ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to impose a penalty under section 28(1)(c) of the old Act. In Vadilal Ichhachand v. CIT [1957] 32 ITR 569 (Bom), the Bombay High Court rejected the view expressed by the Tribunal that the assessee was not liable to penalty taking into account the revised return filed by the assessee and held that the penalty had to be calculated on the basis of the original return and not on the basis of the revised return. In Jayabhai Girdharibhai v. CIT [1957] 32 ITR 677 (Bom), the same High Court expressed the view that the actual result of the assessment has nothing whatever to do with an attempt made by the assessee to conceal particulars of his income in his original return in which he deliberately furnished inaccurate particulars of his income and that the fact that the income had not escaped assessment as a result of the concealment made in the original return is of no consequence for imposing penalty under section 28(1)(c). This court in Sivagaminatha Moopanar and Sons v. CIT [1964] 52 ITR 591 (Mad) expressed that if an assessee made a false return knowing it to be false, the fact that he subsequently disclosed the true particulars of income cannot prevent the application of that section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e tax within the meaning of section 276C(1) of the Act. The furnishing in a statement of profit and loss account showing a false amount of collection would amount to giving false evidence within the meaning of section 193 of the Indian Penal Code. By submitting a false return and a false statement of profit and loss account, the petitioner has attempted to deceive the income-tax Officer and to fraudulently and dishonestly induce him to pass an order of assessment on the basis of the false return and thereby evade proper taxation. Prima facie the provisions of the aforesaid sections come into play. The question whether the petitioner was misled by his accountant or whether he deliberately and wilfully submitted the false return, the false statement of account and maintained a false account is matter which has to be gone into in the trial court and not in these proceedings for quashing. In his petition, the petitioner has also challenged the competency of the respondent to institute this prosecution and the competency of the Commissioner of Income-tax, Central-I, Madras, to give sanction for this prosecution. But no arguments were advanced thereon before me. It is open to the petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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