9911796707
TMI Blog1984 (8) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by VENKATARAMIAH J.- The petitioner is the proprietor of M/s. Ratnam Food Stuff Co., Tuticorin. He is an assessee under the I.T. Act, 1961 (hereinafter called " the Act "). For the assessment year 1977-78, he filed his return under the Act on January 20, 1978, disclosing an income of Rs. 13,380 along with the profit and loss account, trial balance, income-tax adjustment statement and a copy of the capital account. The return was accepted. On August 20 and 21,1981, a search was conducted at the residence of the petitioner under s. 132 of the Act which resulted in the seizure of several documents and account books which revealed suppression of purchase of chicory seeds, the existence of several bank accounts, fixed deposits, investments ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the High Court by four separate orders dated June 19, 1984. The petitioner has filed this petition before this Court under article 136 of the Constitution for leave to appeal against the above-said four orders of the High Court. The only point which arises for consideration in this case is whether prosecutions for offences punishable under s. 276C and s. 277 of the Act and under ss. 193 and 196 of the Indian Penal Code instituted by the Department while the reassessment proceedings under the Act are pending are liable to be quashed on the ground that they were not maintainable. The material parts of ss. 276C and 277 of the Act read as follows, " 276C. Wilful attempt to evade tax, etc.-(1) If a person wilfully attempts in any manne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sand rupees, with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine. (ii) in any other case, with rigorous imprisonment for a term which shall not be less than three months but which may extend to three years and with fine. The relevant parts of sections 193 and 196 of the Indian Penal Code read thus : "193. Punishment for false evidence. Whoever intentionally gives false evidence in any stage of a judicial proceeding, or fabricates false evidence for the purpose of being, used in any stage of a judicial proceeding, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine; and whoever i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... except stating that in the event of the petitioner being exonerated in the reassessment proceedings, the prosecutions may have to be dropped. It is true that, as observed by this court in Uttam Chand v. ITO [1982] 133 ITR 909, the prosecution once initiated may be quashed in the light of a finding favourable to the assessee recorded by an authority under the Act subsequently in respect of the relevant assessment proceedings but that decision is no authority for the proposition that no proceedings can be initiated at all under s. 276C and s. 277 as long as some proceeding under the Act in which there is a chance of success of the assessee is pending. A mere expectation of success in some proceeding in appeal or reference under the Act cannot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Act, the Chief Metropolitan Magistrate issued process. Thereupon the assessee questioned the validity of the initiation of the criminal proceedings before the High Court of Calcutta on the ground that until the penalty proceedings initiated in respect of the same period under s. 271(1)(c) of the Act were finally disposed of, no complaint could be filed. The contention of the assessee was that the prosecution was opposed to the principles of natural justice as he would be deprived of the benefit of a finding which was likely to be recorded in his favour in the penalty proceedings. It was urged on behalf of the Department that the penalty proceedings under s. 271(1)(c) had no direct bearing on the maintainability of a prosecution launched un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e instituted. The reason given by the High Court of Calcutta, therefore, does not appeal to us. It may be that in an appropriate case a criminal court may adjourn or postpone the hearing of a criminal case in exercise of its discretionary power under s. 309 of the Code of Criminal Procedure if the disposal of any proceeding under the Act which has a bearing on the proceedings before it is imminent so that it may take also, into consideration the order to be passed therein. Even here the discretion should be exercised judicially and in such a way as not to frustrate the object of the criminal proceedings. There is no rigid rule which makes it necessary for a criminal court to adjourn or postpone the hearing of a case before it indefinitely ..... X X X X Extracts X X X X X X X X Extracts X X X X
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