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2023 (4) TMI 1216 - HC - Income Tax


Issues involved: Challenge to complaints under Section 276 B r/w 278 B of the Income Tax Act, 1961.

Summary:
1. The petitions challenged complaints alleging failure to deposit deducted tax to the Central Government within the prescribed time for three assessment years.

2. The petitioners argued that the assessing officer did not issue a notice under Section 2 (35) of the Income Tax Act to the Directors before prosecution, citing precedents. They also contended that the delay in granting sanction by the Commissioner of Income Tax violated Board instructions under Section 119 of the Income Tax Act.

3. The respondents argued that separate notice to Directors was unnecessary as per Supreme Court precedent and that the delay in granting sanction was due to the petitioners' belated reply, which is allowed under the instructions.

4. The Court found that the Company and its Directors were prosecuted for the offence under Section 276 B of the Income Tax Act, rejecting the argument that no notice to Directors was issued. Citing Supreme Court precedent, the Court held that initiation of criminal proceedings based on necessary averments in the complaint is valid.

5. Regarding the belated sanction issue, the Court noted it as a factual matter to be decided at trial and declined to quash the complaints, stating that the points raised should be addressed before the trial Court.

6. The Court dispensed with the appearance of the petitioners before the trial Court considering their age, and dismissed the Criminal Original Petitions, closing the connected Miscellaneous Petitions.

 

 

 

 

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