TMI Blog2023 (4) TMI 1216X X X X Extracts X X X X X X X X Extracts X X X X ..... e petitioners had deducted tax from the payments made to various parties and failed to deposit the tax to the credit of the Central Government within the prescribed time - petitioners submitted that the assessing officer had not issued a notice under Section 2 (35) of the Income Tax Act to the Directors of the Company before the impugned prosecution was launched and hence the impugned complaint is liable to be quashed - HELD THAT:- This Court finds that the Company and its Directors have been prosecuted for the offence under Section 276 B of the Income Tax Act. The contention of the learned counsel for the petitioners that no notice was issued to the Directors as mandated under Section 2 (35) of the Income Tax cannot be accepted. The imp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... had deducted tax from the payments made to various parties and failed to deposit the tax to the credit of the Central Government within the prescribed time. The impugned complaints pertain to three different assessment years. It is alleged that in all three assessment years, the petitioners had delayed the deposit of tax deducted at source and therefore were liable for offences under Section 276 B r/w 278 B of Income Tax Act. 3. The learned counsel for the petitioners submitted that the assessing officer had not issued a notice under Section 2 (35) of the Income Tax Act to the Directors of the Company before the impugned prosecution was launched and hence the impugned complaint is liable to be quashed. He relied upon the Judgment of this ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ence, the delay cannot be attributed to the respondents. 5.This Court finds that the Company and its Directors have been prosecuted for the offence under Section 276 B of the Income Tax Act. The contention of the learned counsel for the petitioners that no notice was issued to the Directors as mandated under Section 2 (35) of the Income Tax cannot be accepted. The Hon'ble Apex Court in Madhumilan Syntex Ltd., and others vs. Union of India and another (cited supra) had held as follows: ''43. From the statutory provisions, it is clear that to hold a person responsible under the Act, it must be shown that he/she is a principal officer under Section 2(35) of the Act or is in charge of and responsible for the business ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice it was stated that the Directors were to be considered as principal officers under the Act and a complaint was filed, such complaint is entertainable by a court provided it is otherwise maintainable.'' In view of the above Judgment, the impugned complaints cannot be quashed on the ground that no notice under Section 2 (35) of the Income Act was issued to the Directors. Further, the question as to whether the Directors were in charge of and responsible to the Company for its business is factual and has to be agitated only before the trial Court. 6. As regards, the ground raised by the petitioner that the sanction to prosecute was given belatedly in violation of the Standard Operating Procedure given by the Board which ..... X X X X Extracts X X X X X X X X Extracts X X X X
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