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1994 (11) TMI 127

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..... deration both the returns and fixed the net profit at 10 per cent. of the gross receipts amounting to Rs. 14,30,550 without giving the necessary depreciation rebate which was being given every year. The petitioner filed an appeal before the Commissioner of Income-tax (Appeals) challenging the aforesaid order. The appeal was dismissed on June 29, 1992. The petitioner then preferred an appeal before the Income-tax Appellate Tribunal and that appeal was pending before the Tribunal. A complaint was filed against the petitioner for prosecution for having committed offences under sections 276C and 277 of the Income-tax Act. The complaint was filed in the Court of Special Judicial Magistrate (Economic Offences), Jamshedpur. The gravamen of the acc .....

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..... to evade tax liability by furnishing inaccurate particulars of income and making false verification in the return of income. Thus, the accused made itself along with its partners liable to be prosecuted under sections 276C and 277 of the Income-tax Act, 1961." The Special Magistrate took cognizance and summoned the petitioner for trial. The petitioner has filed the present writ application for quashing the complaint case ; the ground being that prosecution was premature and impermissible so long as the appeal was sub judice before the Tribunal and, consequently, the allegations in the complaint constitute no offence under sections 276C and 277 of the Income-tax Act. The Tribunal disposed of the appeal by order dated December 15, 1993 (ann .....

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..... 1, the assessee was advised to produce its books of account. He was asked to attend on March 27, 1991. But despite opportunities, accounts were not produced. The assessee had shown a loss of Rs. 6,18,581 for the current assessment year giving no explanation for the loss. The assessee was directed to show cause as to why profit would not be taken at 10 per cent. of the gross receipt. The assessee had debited Rs. 90.17 lakhs to the wage account. At the end of the year, there were general entries by which an amount of Rs. 52 lakhs had been debited as expense payable for the year. No vouchers were shown for the full period. The Deputy Commissioner held that the petitioner had deliberately not produced the complete set of books despite enough op .....

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..... r because allowance of depreciation under section 32 of the Income-tax Act is mandatory and was not a matter dependent on the genuineness of the books of account. The Tribunal directed the revised return to be accepted. The appeal was allowed in part. Therefore, in our opinion, the contention of Sri Dayal cannot be accepted. Considering the fact that other findings were not disturbed by the Appellate Tribunal, it cannot also be argued that on the allegation made in the complaint no case is made out. These are matters which are to be considered during the trial. The prosecution, therefore, cannot be quashed. The application is, therefore, dismissed. There will be no order as to costs. P. K. DEB J.---I agree.
Case laws, Decisions, Judgem .....

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