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TMI Blog2006 (6) TMI 85X X X X Extracts X X X X X X X X Extracts X X X X ..... rities to launch prosecution under sections 276C, 277 and 278 - In that view of the matter, the order of acquittal granted is sound and proper. – The revenue’s appeal is dismissed. - - - - - Dated:- 1-6-2006 - Judge(s) : K. SREEDHAR RAO. JUDGMENT K. Sreedhar Rao J.- The account books of A1 to A3 disclosed a sum of Rs. 1,00,000 as loan from A4. Accordingly, the returns were filed by A1 to A3 for the assessment period 1986-87. The tax authorities conducted a search of the premises of A4 and found that there is no corresponding entry in the accounts of A4 to corroborate the loan of Rs. 1,00,000 to A1 to A3. A4 was not able to substantiate the source, hence he stated to the income-tax authority that the entry is a false entry relating ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... (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. (2) If a person wilfully attempts in any manner whatsoever to evade the payment of any tax, penalty or interest under this Act, he shall, without prejudice to any penalty that may be imposable on him under any other provision of this Act, be punishable with rigorous imprisonment for a term which shall not be less than three months but which may extend to three years and shall, in the discretion of the court, also be liable to fine. 277. False statement in verification, etc.-If a person makes a statement in any verification under this Act or under any rule made thereunder, or delivers ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sons can accept the revised return and pass necessary orders in accordance with law. The revised returns were accepted by the authorities. Yet the Department notwithstanding the acceptance of the revised returns under section 139(5) has launched prosecution against the accused for the offences under sections 276C, 277 and 278. The conscious and wilful attempt to evade tax is the primary ingredient of the offence under the above provisions. When once the income-tax authorities have accepted the revised returns under section 139(5) it becomes explicit that the earlier return filed was a bona fide mistake and does not indicate any mens rea element. Therefore, after having accepted the revised return, it is impermissible for the income-tax au ..... X X X X Extracts X X X X X X X X Extracts X X X X
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