2008 (4) TMI 2 - SC - Income Tax

Criminal proceedings in Income Tax evasion of income tax by showing lower purchase price than actual consideration Appellant has already served 7 days in jail already having the peculiarity sentenced n reduced to the perod already undergone by the appellant from 3 months R.I.

Summary

Issues Involved:
1. Valuation of property for income tax purposes
2. Conviction under various sections of the Income Tax Act and IPC
3. Appeal against the conviction and sentence
4. Consideration of leniency based on circumstances

Issue 1: Valuation of property for income tax purposes

The case involved a search under Section 132 of the Income Tax Act, 1961, where discrepancies were found in the valuation of a property purchased by the appellant. The appellant declared the property's value at Rs.2,40,000, while the actual value was assessed at Rs.6,75,000. This led to allegations of tax evasion on the balance amount of Rs.3,30,000. The appellant's application under Section 230-A(1) of the Act for settling the property in her son's name further complicated the matter.

Issue 2: Conviction under various sections of the Income Tax Act and IPC

The trial court convicted the appellant under Section 420 IPC read with Section 511 IPC, Section 193 IPC read with Section 136 of the Income Tax Act, Section 276-C(1), and Section 277 of the Act. The appellant was sentenced to varying terms of imprisonment and fines for these offenses. The High Court, while confirming some convictions, acquitted the appellant on certain counts after reassessing the facts related to the property valuation and payments made by different parties.

Issue 3: Appeal against the conviction and sentence

The appellant filed an appeal before the Sessions Court, which upheld the trial court's decision. Subsequently, a Criminal Revision Petition was filed before the High Court, leading to a mixed outcome where some convictions were confirmed, while others were set aside. The appellant's senior counsel argued that the appellant had been acquitted for offenses related to the Act but convicted for unrelated offenses. The court considered the appellant's age, the time elapsed since the incident, and the fact that she had children in deciding on the sentence.

Issue 4: Consideration of leniency based on circumstances

Taking into account the appellant's acquittal under certain sections of the Act, the court decided to reduce the appellant's sentence to the period already served. However, a fine was imposed on the appellant. The court emphasized that this decision should not set a precedent for future cases. Ultimately, the appeal was disposed of based on these considerations.

This detailed analysis of the judgment highlights the issues of property valuation for tax purposes, convictions under relevant sections, the appeal process, and the court's leniency based on the appellant's circumstances.