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TMI Blog1995 (3) TMI 60X X X X Extracts X X X X X X X X Extracts X X X X ..... d seized a sale agreement dated October 27, 1984, between the second petitioner and one M. Lakshmanan, the owner of 8.37 acres of agricultural lands situated in Thirupporur, for the sale of those lands to the second petitioner for a sum of Rs. 2,75,000. Subsequently, the said Lakshmanan had executed a registered sale deed dated December 17, 1984, in respect of the same lands in favour of the first petitioner for a consideration of Rs. 45,000 only. The enquiry by the Income-tax Department revealed that though the seller, M. Lakshmanan, had received the sale consideration of Rs. 2,75,000 and this amount was deposited by the second petitioner in the names of the family members of the said Lakshmanan in Indian Overseas Bank, West Mambalam branch, in the sale deed only Rs. 45,000 was shown as sale consideration suppressing the real consideration and undervaluing the sale deed. Therefore, the respondent-Income-tax Department filed a complaint under the abovementioned sections for dealing with these petitioners according to law. The prosecution examined five witnesses to show the prima facie case against the petitioners and the learned Additional Chief Metropolitan Magistrate was not sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cused for making the first accused give a false declaration in exhibit P-9, the learned Magistrate has found that as the first accused had not committed the offence under section 276C, the second accused cannot be convicted for abetment and, therefore, section 278, Income-tax Act, also was not attracted in this case. Learned counsel appearing for the revision petitioner, Mr. Panchapagesan, would submit that the view taken by the Additional Chief Metropolitan Magistrate is correct as the evidence discloses that these petitioners have undervalued the sale consideration before the registering authorities only for the purpose of reducing the stamp duty and at the most, they can be tried only for evading the stamp duty but they cannot be punished for the offences mentioned in the complaint of the respondent and, therefore, the charges cannot be framed for these offences against the petitioners. Learned counsel further submitted that even though the first petitioner had filed exhibit P-9, Form No. 37G prescribed under rule 48G of the Income-tax Rules, which gives the value of the property conveyed at Rs. 45,000, under section 269P of the Income-tax Act, the proviso reads that this stat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f consideration on account of natural love and affection ". From these details what was required in Form No. 37G, exhibit P-9 was that the first petitioner-transferee should have given the correct market price of the property, namely, Rs. 2,75,000, but she has falsely stated in this form that the estimated market value of the property was only Rs. 45,000 and, therefore, she has not explained anything in column No. 12 also. When the value of the property exceeds Rs. 50,000, Form No. 37G should be forwarded by the Registering Officer to the Income-tax Department so that they would take up the task of verifying the source of income of the transferee of the property. As the real sale consideration is suppressed in Form No. 37G (exhibit P-9) the normal presumption would be that the petitioners attempted to evade the tax payable to the Income-tax Department by giving a false statement in exhibit P-9. Again, it should be borne in mind that Form No. 37G is a form to be sent to the Income-tax Department in relation to the income-tax payable by the parties. Learned counsel for the petitioners, Mr. Panchapagesan, would argue that the petitioners have paid tax on their income and even before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d, there is verification in exhibit P-9 and it cannot be denied that this verification is in respect of the false statement with regard to the sale consideration. But the learned Additional Chief Metropolitan Magistrate took the view that under section 277(i) of the Income-tax Act, only when this statement was accepted as true for the purpose of assessing the tax, it becomes an offence punishable and in this case, as the Income-tax Department did not act upon this statement, section 277 of the Income-tax Act is not attracted. Even if the view is accepted, it is only under section 277(i) of the Income-tax Act for the purpose of imposing a minimum punishment of six months, that section is attracted whereas under section 277(ii) of the Income-tax there is no such specific clause making it punishable only when the false statement was acted upon by the Income-tax Department. Therefore, prima facie, it cannot be said that section 277 of the Income-tax Act is not applicable to this case. The learned Additional Chief Metropolitan Magistrate took the view that as there was no violation of the provisions of either the Indian Penal Code or the Income-tax Act on the part of the first petitio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ted evidence. As exhibit P-9 is a fabricated document which, according to the Income-tax Department, was intended to be used to evade tax, even the attempt to use this document before the Income-tax Department is a prima facie evidence for the offence under section 196, Indian Penal Code. In section 199, Indian Penal Code, the false statement or making any statement which is false to the knowledge of the first petitioner is also an offence and the Income-tax Officer is entitled to file this complaint under section 195(1)(b)(i), Code of Criminal Procedure, as mentioned above. Section 200, Indian Penal Code, also relates to the corrupt use or attempt to use any declaration knowing the same to be false. Here also, even the attempt is sufficient to attract punishment under the section. It is needless to repeat that as Form No. 37G prepared by the first petitioner relates to the proceedings of the Income-tax Department, naturally, there is prima facie evidence for these sections also. The other sections, namely, sections 34, 37, 114 and 120B, Indian Penal Code, are for the joint action of the accused persons. As the evidence of the vendor is that on the request of the second petitioner, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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