1975 (12) TMI 16 - HC - Income Tax

Summary

Issues:
1. Prosecution under section 277 of the Income-tax Act
2. Authority to proceed with prosecution under section 279 of the Act
3. Effect of orders by the Income-tax Appellate Tribunal on prosecution

Analysis:

1. The case involved a complaint filed by the Income-tax officer for an offence under section 277 of the Income-tax Act, alleging concealment of income in the return filed by the accused. Before the charge was framed, an objection was raised regarding the prosecution's legality under section 279 of the Act. The revision against the trial court's refusal to discharge the accused was dismissed by the 1st Civil and Sessions Judge.

2. Subsection (1) of section 279 requires prosecution under section 277 to be at the instance of the Commissioner. The evidence showed that the Commissioner had authorized the prosecution, as interpreted in previous case law. Subsection (1A) of section 279 prohibits prosecution if the penalty under section 271 has been reduced or waived. The accused argued that the order of the Income-tax Appellate Tribunal setting aside the penalty should prevent prosecution. However, the Tribunal's order does not fall under subsection (1A) as it does not involve waiver or reduction of penalty.

3. The Tribunal's order does not equate to the waiver or reduction of penalty as required by subsection (1A) of section 279. The prosecution can proceed even if the penalty is not imposed, and the Tribunal's decision does not automatically bar the prosecution. The criminal court has jurisdiction to continue with the complaint and determine the case based on evidence presented. The court cannot dismiss the complaint solely based on the Tribunal's findings.

4. The argument that the words in section 279(1A) should be interpreted to include cancellation by the Income-tax Appellate Tribunal was rejected. The court cannot add conditions to the statute beyond what is explicitly stated. The request to quash the prosecution based on the Tribunal's findings was also denied, as there was no legal evidence presented yet to support quashing the proceedings. The court held that section 279(1A) does not bar further proceedings against the applicant, and the revision was dismissed.