2019 (3) TMI 484 - HC - Income Tax

Prosecution u/s 276-C(1) & 277 - Application for getting the present AO examined as an additional witness and another application for filing additional documents - right to cross-examine the additional witness in respect of documents sought to be placed on record - HELD THAT - Reasoning adopted by the trial court, as referred does not suffer from any illegality or infirmity. There is no basis to come to a conclusion that respondent is adopting dilatory tactics or is in any way harassing petitioner. The additional evidence sought to be led appears to be for bonafide purpose and to substantiate the allegations made in the complaint. Petitioner does not suffer any prejudice as petitioner has an opportunity to cross-examine the additional witness in respect of documents sought to be placed on record. Finding no infirmity in the concurrent findings returned by the courts below, this petition and the application are accordingly dismissed while refraining to comment upon the merits of this case.

Summary

Issues: Application for additional witness and documents in a complaint under Sections 276-C(1) & 277 of the Income Tax Act for the Assessment Year 2002-03.

Analysis:
1. The respondent filed applications for an additional witness and additional documents in a complaint related to undisclosed foreign bank accounts of the accused for the Assessment Year 2002-03. The trial court allowed both applications, emphasizing the challenges faced by Indian Authorities in obtaining details of foreign bank accounts. The court noted that the complainant, the Income Tax Department, had valid reasons for filing the additional documents at a later stage, ensuring the accused would have opportunities to counter the evidence during the trial.

2. The revisional court upheld the trial court's decision, affirming the allowance of the applications for additional witness and documents. The petitioner challenged these orders, arguing that the documents sought to be placed on record were from 2009 and 2015, whereas the assessment year was 2002-03. Citing a Supreme Court decision, the petitioner contended that additional evidence should be carefully considered to advance justice and not to harass the accused. The petitioner raised concerns about potential prejudice and delay caused by the late submission of evidence.

3. The petitioner's counsel highlighted that the complainant's witness had already been cross-examined, and introducing new evidence at the charge stage could prejudice the petitioner and prolong the proceedings. The respondent, however, defended the necessity of the additional evidence for a fair adjudication of the complaint, asserting that the petitioner could cross-examine the additional witness regarding the new documents. The respondent explained that the information relevant to the assessment year was received in 2009 and 2015, leading to the delayed submission of the documents in 2015.

4. Upon review, the court found no illegality or harassment by the respondent in seeking additional evidence. The court determined that the additional evidence appeared to serve a genuine purpose in substantiating the allegations in the complaint. Emphasizing that the petitioner had the opportunity to cross-examine the additional witness, the court dismissed the petition and application, refraining from commenting on the case's merits. The decision upheld the trial and revisional courts' rulings, concluding that the additional evidence was admissible and necessary for a fair adjudication.