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TMI Blog1998 (7) TMI 26X X X X Extracts X X X X X X X X Extracts X X X X ..... statement of income, item-wise trading account, profit and loss account and balance-sheet. The accused/respondent in that return bad shown his income as Rs. 621 from house property, about Rs. 10,610 as share income from the partnership firm, about Rs. 7,300 from his own business in oil and about Rs. 6,019 under the head "Other sources", He had shown the taxable total income as Rs. 17,000 after the deduction. The respondent/accused, had signed the verification column in the return and the statements. The books of account of the respondent were called for and examined. It was found that the respondent had made an entry in his books of having effected "credit" purchase from Sarathi Oil Mills, Vellore, on 21-2-1983, for Rs. 28,000. This amount was shown as due to Sarathi Oil Mills by the respondent as on 31-3-1983, i.e., the end of the financial year. Enquiries made with M. Panneerselvam, the proprietor of Sarathi Oil Mills revealed that the respondent had paid cash amount of Rs. 28,000 on the day of purchase and there was no amount due from the respondent to Sarathi Oil Mills. The respondent had omitted to record this payment in his books of account, and this amount ought to have come ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al income as per the revised return was Rs. 67,010 as against Rs. 17,000 returned in the original returns. The assessment was completed on or about November 14, 1985, by the Income Tax Officer determining the income at Rs. 77,430. The respondent fabricated his account books for the accounting period 1-4-1982, to 31-3-1983, relevant for the assessment year 1983-84 omitting to record payments made and by understating his real income and thereby committed the offence of fabricating false evidence punishable under section 193 of the Indian Penal Code, 1860. The respondent by furnishing the original return of income and statements referred to above based upon the fabricated books of account, mentioned above and corruptly and knowingly using them as true and genuine evidence in the course of the income-tax proceedings, which are judicial proceedings within the meaning of section 136 of the Income Tax Act has committed the offence punishable under section 196 of the Indian Penal Code, 1860. The respondent by furnishing the original false return of income and statements referred to above and attempting to obtain an income-tax assessment order based thereon, has attempted to cheat and there ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ges were explained to the respondent, he denied the same and wanted to cross examine the seven witnesses examined in chief. Accordingly, an opportunity was given to the respondent/accused to cross-examine the witnesses. 23 documents were marked on the side of the complainant. No material object was marked. No witness or material object was marked on the side of the respondent/accused. The trial magistrate on an appreciation of the evidence placed before him and for the reasons assigned by him in the judgments reached the conclusion that the complainant/appellant, viz., the Income Tax Officer, Circle-I (1), Vellore, had not proved the charges framed against the respondent/accused beyond reasonable doubt and acquitted him under section 248(1) of the Criminal Procedure Code. Aggrieved by the judgment of acquittal, the complainant has come forward with this appeal through the senior Special Public Prosecutor for income-tax cases, Madras. The learned trial magistrate concluded that the complainant/appellant has not proved the guilt of the respondent/accused for three reasons, viz. : 1. There is no acceptable evidence to prove, the respondent paid cash to PWs-4, 5 and 7 and p ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bona fide assessee to submit revised returns, if it was found out by him voluntarily that a mistake has occurred and due allowance has to be given by the income-tax authorities, But that is not the case on hand. Learned counsel for the appellant argued that the reasoning of the learned trial judge in paragraph 10 of the judgment that the respondent/accused was not questioned about the discrepancy found out in the return submitted by him is thoroughly wrong and the evidence of the witnesses examined on the side of the complainant would put things beyond doubt, that the respondent was specifically questioned on those aspects and he was unable to give any convincing reply and realising that he cannot misrepresent any more, he had submitted a revised return. Learned counsel for the respondent/accused drew the attention of this court to the ruling in CIT v. Anwar Ali (1970) 76 ITR 696; AIR 1970 SC 1782, wherein it had been held of (headnote of AIR 1970) : "Proceedings under section 28 are of penal nature and the burden is on the department to prove that the receipt of the amount in dispute constitutes the income of the assessee. The mere fact that the explanation given by the asse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... P.Ws 4, 5 and 7 show that the respondent had paid cash. On a consideration of the submissions of learned counsel for both parties, I find there is substantial force in the submissions of learned counsel for the appellant. I am inclined to hold that the contention of learned counsel for the respondent that the accounts of P.Ws 4, 5 and 7 are false and only to escape liability and penalty from the income-tax officials, they wrote in their accounts that cash has been received, appears to be most artificial and unacceptable. I am also inclined to hold that immediately after finding out certain discrepancies, the respondent/accused had not filed the revised return. After every fact was ascertained and personally verified from Ms. 4, 5 and 7 and the respondent was interrogated about the same, he came forward with a revised return and not bona fide before. Therefore, it cannot be said some mistake had occurred in writing the accounts and immediately after finding out the same, the respondent had come forward with the revised return. On an analysis of the evidence carefully, I find it difficult to accept the submission made on behalf of the bona fide mistake had occurred and in good ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... about the sentence to be imposed on him on June 18, 1998. The respondent represented that he had become old and he was co-operating with the Government and was paying income-tax regularly. Mercy may be shown to him and he may be excused. Learned counsel for the respondent-accused submitted that the proceedings were started in the year 1983-84 and many years have elapsed. The respondent was undergoing mental agony for all these years. Further, he was affected with jaundice twice and he is taking treatment continuously. He is also suffering from stone liver. It is also stated that in adjudication proceedings which are parallel proceedings, the Income-tax Tribunal had allowed his appeal in respect of the same matter. However by mistake the said orders have not been filed earlier in this court. Learned counsel submitted that he is producing the orders of the Tribunal for the perusal of this court for the purpose of appreciating the sentence that may be imposed on the respondent. Learned counsel pleaded that the minimum sentence prescribed under sections 276C(1) and 277 of the Income Tax Act, 1961, may not be imposed on the respondent-accused considering that he has become very old ..... 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