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2022 (1) TMI 45 - HC - Income TaxOffences u/s 276CC, 276C(1) and 276C(2) - Non-filing of ITR for Second PAN number - main contention of the petitioner is that the prosecution itself has been launched under the wrong premise that the petitioner has not filed his return - HELD THAT - Admittedly, the issuances of two PAN cards bearing numbers AKKPS7295P and ALIPS4185M is not disputed. Though apply for two PAN cards many not be correct, the fact remains that it is the duty of the Department to verify and issue PAN cards, which has not been done in this case. Be that as it may, a perusal of the records available on record reveals that the petitioner has been repeatedly making request for surrender of second PAN card and finally surrendered the same and also obtained acknowledgment vide letter dated 10.02.2012. Now the prosecution has been launched on the premise that the petitioner has not even paid tax for the Assessment year 2013-14. This Court is of the view that when the petitioner has already surrendered the PAN card bearing No. bearing number ALIPS4185M, the question of initiating prosecution for wilful and deliberate default to furnish return of income tax does not arise and the continuation of prosecution as against the petitioner is a futile exercise and the same is liable to be quashed.
Issues: Quashing of proceedings in E.O.C.C.No.223 of 2016 under Sections 276CC, 276C(1) and 276C(2) of the Income Tax Act, 1961.
Analysis: The petitioner filed a petition seeking to quash the proceedings in E.O.C.C.No.223 of 2016, which were pending for offenses under Sections 276CC, 276C(1), and 276C(2) of the Income Tax Act, 1961. The prosecution alleged that the accused failed to file an Income Tax return for the Assessment year 2013-14 despite a showcause notice. The petitioner contended that the prosecution was based on the wrong premise that he did not file his return, as he had inadvertently been issued two PAN cards. The petitioner had surrendered the second PAN card and filed income tax returns for the correct PAN number without any default. The Special Public Prosecutor argued that applying for two PAN cards was incorrect, and since no returns were filed for the second PAN card, the prosecution was justified. The Court noted the issuance of two PAN cards and the petitioner's repeated requests to surrender the second card, which was eventually done. The Court held that since the petitioner had surrendered the second PAN card and filed returns for the correct PAN number, there was no basis for prosecution for willful default in filing income tax returns. Therefore, the Court quashed the proceedings in E.O.C.C.No.223 of 2016. Conclusion: The High Court allowed the Criminal Original Petition and quashed the proceedings in E.O.C.C.No.223 of 2016 pending before the Additional Chief Metropolitan Magistrate, Economic Offences-I, Egmore, Chennai. The Court found that the continuation of the prosecution against the petitioner was unjustified as he had surrendered the second PAN card and filed income tax returns for the correct PAN number. Consequently, the connected miscellaneous petitions were closed.
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