Withdrawl of prosecutions once initiated. - Income Tax - 5256/1995

INSTRUCTION NO. 5256/1995 Dated: October 20, 1995 Section(s) Referred: 279(2) Statute: Income - Tax Act, 1961 The existing guidelines for compounding of offences under the Direct Tax Laws were issued vide F.No. 285/161/90-IT(Inv) dated 30-9-1994 and were circulated under a separate forwarding letter of even number and date. These guidelines do not cover cases of withdrawal of prosecutions once initiated. 2. The Board has been receiving a number of proposals from Chief Commissioners for withdrawal of prosecution in the event of the Revenue losing its case in appeal either in respect of penalty or quantum or both. In this connection, it has been decided that in cases where either the quantum additions and/or penalty by the Appellate Authorities and such decisions have been accepted by the Department, the CCs should, instead of forwarding to the Board the proposals/requests for withdrawal of prosecution, direct that the relevant facts and changed circumstances be brought to the notice of the Departmental Prosecution Counsel who in turn should inform the Trial Court of the changed circumstances and concomitant infirmity in the prosecution complaint. This would facilitate disposal and discharge of the complaint. 3. The above procedure may be brought to the notice of all concerned and the receipt of this letter may kindly be acknowledged. F.No. 285/160/90-IT(Inv),