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2012 (3) TMI 576 - HC - VAT and Sales TaxCheating the Government by evading the payment of tax - Prayer to quash the FIR - offence punishable u/s 420 of IPC - HELD THAT - There is no provision of registration of FIR in such like matters of evading the tax. The provisions provide for the mandatory penalty. It is well settled proposition of law that if a special provision has been made qua particular subject, the said subject is excluded from the general provisions. Thus, the only allegation in the said FIR that the petitioner helped the main accused to evade the tax under no circumstances invite the offence of Section 420 of IPC, in case, the person is found guilty of evading the tax. The Punjab Value Added Tax Act provides for payment of penalty. The provisions of the said VAT Act are sufficient and equipped to deal with the matters where an attempt is made to evade the tax. Thus, the registration of the FIR in such like matters is totally an abuse of process of law. Once an FIR cannot be registered against a person who evaded the tax, no FIR can be registered against a person who is stated to have assisted and the person who has attempted to evade the tax. Thus, the present petition is allowed and FIR, u/s 420, 120-B, 186, 34 of IPC, and subsequent proceedings arising out of the same are hereby quashed.
Issues:
Quashing of FIR under Section 482 Cr.P.C. involving allegations of tax evasion and assistance in tax evasion. Analysis: 1. The petition sought the quashing of FIR No. 74 dated 24.06.2010 under various sections of the Indian Penal Code related to tax evasion. The FIR alleged that the petitioner assisted in evading tax by helping a person evade tax by changing routes. 2. The petitioner argued that even if the allegations were true, no criminal offense was made out as the matter falls under the civil nature as provided under the Punjab VAT Act. The petitioner contended that penal provisions under the VAT Act apply in cases of tax evasion, not criminal offenses under the IPC. 3. The State's response highlighted that the petitioner was found cheating the government by evading tax and assisting the main accused in evading tax by changing routes. The State proceeded against the petitioner under the Indian Penal Code for these allegations. 4. The petitioner was accused of driving a car, overtaking a truck, and instructing the truck to go back to avoid tax officers. However, the petitioner was neither the owner of the truck nor had any connection with the goods being transported. He was accused of assisting in evading tax. 5. The court referred to specific sections of the Punjab Value Added Tax Act, emphasizing penalties for failure to provide necessary documents or for attempting to evade tax. The court noted provisions for penalties of 50% and 30% of the value of goods in different scenarios of tax evasion. 6. Citing a judgment by the Supreme Court, the court emphasized that special provisions in specific acts take precedence over general provisions. The court concluded that the provisions of the VAT Act were sufficient to address matters of tax evasion and that registration of FIR in such cases was an abuse of the legal process. 7. Ultimately, the court allowed the petition and quashed the FIR and subsequent proceedings under various sections of the Indian Penal Code related to tax evasion, stating that the provisions of the VAT Act adequately dealt with tax evasion matters. This detailed analysis of the judgment showcases the legal arguments, statutory provisions, and court's reasoning leading to the decision to quash the FIR related to tax evasion allegations.
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