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TMI Blog1998 (7) TMI 499X X X X Extracts X X X X X X X X Extracts X X X X ..... 1 within the prescribed period, thus flouting the provisions of sections 159, 220 read with section 162 of the Act. The learned Additional Chief Metropolitan Magistrate came to the conclusion that it was the petitioner alone who was liable for the default in submitting the annual returns and balance sheets for the years 1987-88 to 1989-90. In respect of the year 1990-91, Shri Moti Lal Bhatia and Smt. Suman Bhatia were held liable for the default in filing the annual return and balance sheet. Accordingly, the petitioner was sentenced to pay Rs. 2,000 as fine in each of the six cases relating to the years 1987-88 to 1989-90. In default of payment of fine, she was required to undergo simple imprisonment for one month in each case. Accused Moti Lal Bhatia and Suman Bhatia were to pay a fine of Rs. 1,000 each in the two cases relating to the year 1990-91. In default of payment of fine, they were required to undergo simple imprisonment for one month each. The petitioner not being satisfied with the order passed by the learned Additional Chief Metro- politan Magistrate, filed six appeals before the learned Additional Sessions Judge. As already pointed out these appeals came to be dismisse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the petitioner resigned as the director of the company, she remained an 'officer in default' as envisaged by section 5. 6. Insofar as the first question is concerned, this Court in Kuldip Singh v. State 34 [1988] DLT 11 held that considering the objects of the provisions of sections 159 and 220 read with section 162 and the language used therein, the offences of which the accused were charged, namely, non- filing of annual return, balance sheet and profit and loss account within the period prescribed, were continuing offences and, therefore, the period of limitation provided by section 468 did not have any application. It was further held that the said offences will be governed by section 472 of the Code, according to which a fresh period of limitation shall began to run at every moment of time during which the offences continue. This Court considered the following three decisions of the Supreme Court, which dealt with the question as to whether a particular offence was a continu- ing offence or not: 1.State of Bihar v. Deokaran Nenshi AIR 1973 SC 908; 2.Bagirath Kanoria v. State of Madhya Pradesh [1984] 3 Comp. LJ 49; and 3.Maya Rani Punj v. CIT [1986] 157 ITR 330 (SC). 7. In ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t non-compliance with the obligation of making return is an infraction as long as the default continued. Without sanction of law, no penalty is impossible with reference to the defaulting conduct. The position that penalty is impossible not only for the first default but as long as the default continues and such penalty is to be calculated at a prescribed rate on monthly basis is indicative of the legislative intention in unmistakable terms that as long as the assessee does not comply with the requirements of law, he continues to be guilty of the infraction and exposes himself to the penalty provided by law." (p. 341) 8. The Supreme Court while taking the above view overruled its earlier decision in CWT v. Suresh Seth [1981] 129 ITR 328 where it had taken the view that the provision of imposition of penalty for failure to file the wealth-tax return under the Wealth-tax Act, 1957 with reference to every month during which the. default continued, did not have the effect of making the default a continuing one. 9. In the instant case, there are clear indications in sections 162 and 220(3) that the Legislature viewed the default in filing the annual return and balance sheets as a cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Court decision in Bagirath Kanoria AIR 1984 SC 1688, 1692; would a fortiori make the offence punishable under section 162(1) or section 220(3) a continuing offence. As already indicated, that was a decision under the Employees' Provident Funds and Miscellaneous Provisions Act, 1952, the provisions whereof require the employers to deposit the contribution within the period prescribed, but the penal section does not expressly provide that non-compliance therewith would render the employer liable to any continued or further penalty until payment. But still the Supreme Court observed thus: 'The appellants were unquestionably liable to pay their contribution to the provident fund before the due date and it was within their power to pay it, as soon after the due date had expired as they willed. The late payment could not have absolved them of their original guilt but it would have snapped the recurrence. Each day that they failed to comply with the obligation to pay their contribution to the fund, they committed a fresh offence.' We have no manner of doubt that these observations would apply to an offence under section 162(1) or section 220(3) with all their rigour. True, late submissi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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