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TMI Blog1987 (1) TMI 3X X X X Extracts X X X X X X X X Extracts X X X X ..... os. 1, 3, 4, A-5 and A-11. A-4, Sanjay Prakash Mohnot and A-5, Anjay Prakash Mohnot, are brothers of A-1 and A-11. Smt. Meena Kumari Mohnot is the mother of A-1 and wife of A-3. A-12, Smt. Hema Mohnot, is the wife of A-1 and they were married on June 22, 1983. Accused Nos. 6 and 7, viz., Mani and Ramani, are accountants of A-1. A-8, M. A. Subban, is A-1's friend. A-9, Smt. Kumudhini Subhan, is A-8's wife. A-10, Prakashchand K. Jain, is not related to the other accused persons. A-13, Smt. Balina Knight B. Rodrigues, is also an employee of A-1. Accused Nos. 14 and 15, viz., P. V. Jagadeesan and V. Sundararaj, are employees of the Madras Race Club. A-16, Smt. V. Dhanalakshmi, is the mother of A-15. A-17, A. C..Dhandapani, is also an employee of the Madras Race Club. Accused Nos. 18 to 20, viz. S. K. Bhandari, Narakanchand P. Jain and M. M. Bijalani, are said to have aided A-1 in the commission of the various offences alleged in the complaint. The case of the complainant is this. The winners in the horse races conducted by the Madras Race Club at Madras and at Ootacamund as well as in the inter-venue races are paid the winning amounts after deducting towards income-tax proportionate ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... jasthan, Sunkurama Chetty Street, Madras-1, was also searched. During the search of the residential premises, an income-tax office file bearing G. 1. No. 6730/B IV(6) relating to an assessee by name S. K. Balu Chettiar, individual, residing at No. 61, C. B. Road, Madras-21, was found. The file is said to have been stolen from the Income-tax Officer, City Circle IV(6), Kannammai Buildings, No. 661, Anna Salai, Madras-6, and it contained income-tax assessment records for the assessment years 1959-60 to 1980-81 and wealth-tax assessment records for the assessment years 1972-73 to 1979-80. Several pass books and cheque books with signed blank leaves of various banks and relating to various bogus transactions including the account books of fictitious and non-existing firms such as Nagasubbiah and Co., Hasan and Co., written by A-7, Ramani, were also found and seized. Pay-in-slips relating to Ashoka Traders, air tickets in the names of N. K. Mohnot, A-1, and M. A. Subban, A-8, to Trivandrum, bus tickets along with the account slips written by N. Mani, A-6, and records relating to Hindustan Electronics, a proprietary concern of A-12, Smt. Hema Mohnot, and other records were seized. A pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tment revealed that A-1 obtained information through accused Nos. 14, 15 and 17 about high amounts deducted from high 'dividends, especially jackpots, paid to the winners in the past years and A-1 applied for duplicate T.D.S. certificates to the race club and obtained the same with the aid of accused Nos. 14, 15 and 17. In some cases, original certificates intended for genuine winners were handed over to A-1. The Department further found that consideration for these illegal and unlawful acts were paid through A-16, wife of A-15. It is further found that A-16 passed receipts to A-1 for some of the consideration received. A-1 caused applications to be made to the Madras Race Club for issue of duplicate T.D.S. on the ground that the original was lost or was not received. The applications were processed by A-14, Jagadeesan, and signed by the secretary or the assistant secretary who caused duplicate T.D.S. certificates to be issued with the aid of accused Nos. 15 and 17. A-17 permitted A-1 or his agents to trace out the signatures of the original winners from the temporary T.D.S. certificates issued to them. In some cases, the original T.D.S. itself was not despatched to the real winner ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ib Street, Madras-1. The assessment was completed on February 20, 1982, and a refund order bearing No. A 014509/B/1/450824 for Rs. 15,756 was issued. The said refund order had been received and acknowledged by A-6 on behalf of Mohnot and Co. The refund order was credited in the account of A-2, Hindu undivided family. The signatures were identified and guaranteed by A-2 represented by the karta, A-3. The enquiry made by the Department revealed that the said Manickam, residing at Mannurpet, Madras-50, winner of jackpot was issued the original T.D.S. certificate bearing No. 1824 and that he filed an income-tax return before the Income-tax Officer, City Circle VII(8), through an advocate, enclosing another T.D.S. certificate for a jackpot amount of Rs. 17,726. The assessment was completed on May 19, 1980, and a refund order was issued to the said Manickam for Rs. 15,756. The refund order and the demand for the tax were received by his advocate. Similarly, one Jayachandran, residing at No. 28, Nellikuppam, Ennore, Madras-57, won a jackpot prize of Rs. 38,079 in the race held on June 16, 1979. A sum of Rs. 13,687 was deducted as tax at source. He filed the income-tax return before the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Department revealed that there was no such office at the address given at Trivandrum and the aforesaid jayachandran never worked in any of the offices there and that he was found to be employed at the Ennore Foundries Ltd., Ennore, Madras-56, during the relevant period. Further investigation revealed that another return was filed before the Income-tax Officer, Circle 1(2), Villupuram, for an alleged firm, Hassan and Co., at Tindivanam. The return describes jayachandran as one of the partners of the said firm and a photostat copy of the duplicate T.D.S. was enclosed with the return. Enquiry by the Department revealed that there is no such firm existing at Tindivanam during that period. A-7, Ramani, is alleged to have written certain account books and they have been seized from the residence of A-1. The returns alleged to have been filed in the name of Hassan and Co. were found forged. Statements were filed by A-1 in connection with the return of the said firm through his clerk, A-6, before the Income-tax Officer, Villupuram. A-1 has represented a bogus firm and has used false documents containing forged signatures to use them in proceedings before the Income-tax Officer, Villu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... od. The documents seized from the locker clearly make out a case of conspiracy among accused Nos. 1, 4, 5, 8 and 9 and in pursuance of the said conspiracy they cheated the Income-tax Officer, 'B' Ward Salaries Circle, Trivandrum. The enquiry made by the complainant also revealed that one K. Natarajan won a jackpot in an inter-venue betting at Madras on October 2, 1979, and was issued a T.D.S. certificate on October 10, 1979. He filed his return before the concerned Income-tax Officer on May 27, 1980, through his authorised representative, M/s. Shankar Sadguru and Co., Madras, and an assessment order was passed, refunding an amount of Rs. 61,846. However" it is found that A-1 obtained a duplicate T.D.S. certificate on behalf of the said Natarajan for a sum of Rs. 65,844 on December 6, 1981, with the active assistance of accused Nos. 14, 15 and 17. A return was filed on the basis of the aforesaid duplicate T.D.S. on March 7, 1983, before the Income-tax Officer, City Circle III(10), Madras, in the name of K. Natarajan. Later on, a letter was filed before the Incometax Officer, City Circle III(10) on August 31, 1983, wherein it was stated that K. Natarajan had shifted to Bombay and, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have forged signatures of the original winners and made false documents with the aid of the other accused persons and filed returns containing false declarations before the Income-tax Officers mentioned above. The offences punishable and enumerated in the complaint are under section 120B, Indian Penal Code read with sections 420, 467, 468, 471, 181, 182, 177, 193, 196, 197, 198, 199, 200, 201, 386, 379, 419, 420 read with section 511, Indian Penal Code and section 277 of the Income-tax Act. The complaint was presented on February 23, 1985, and taken on file on March 7, 1985, by the Additional Chief Metropolitan Magistrate (E.O.I.), Egmore, Madras-8. A rubber stamp put on the docket sheet attached to the complaint reads as follows : " Taken on file. Accused absent. Issue summons to the accused for 13-3-1985. " On March 13, 1985, the following endorsement was made on the docket sheet : " A-2 company, A-1, A-4, A-5, A-7, A-8, A-13 to A-17 and A-19 present. Copies furnished. Summons not served against A-3, A-11 and A-12. Issue fresh summons to A-3, A-11 and A-12. A-6, A-9, A-10, A-18 and A-20 absent. Petition filed under section 317, Criminal Procedure Code, allowed and absenc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nder sections 199 to 201, Indian Penal Code, are alleged to have been made before the Income-tax Officer, who is a court as contemplated under section 136 of the Act and the complaint by the Chief Commissioner (Admn.) is not maintainable. Learned counsel appearing for the prosecution submitted that all these contentions can be raised by the accused persons before the trial court and this is not the stage when this court should exercise the power vested in it under section 482, Criminal Procedure Code. It is open to the accused persons to appear before the trial court and urge all the points in their defence as provided under section 245(1) or (2) Criminal Procedure Code. After taking evidence referred to in section 244, Criminal Procedure Code, he further submitted that it is open to the accused persons to approach this court under section 482, Criminal Procedure Code, to quash the charges, in case the charges framed are without any basis. It is true that the accused persons have got two remedies available to them. One is as provided under section 245(2), Criminal Procedure Code, in which the Magistrate can discharge the accused at any previous stage of the case for reasons to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the enquiry or probe will be received in evidence and, in case the witnesses go back on their statements, they will be prosecuted for perjury and thereby the witnesses will be compelled to speak only in support of the Department. In case the offence is investigated by the police, the witnesses will be at liberty to state the truth before the court and they are not prevented from going back on the contents of the statements recorded by the investigating agency. (e) Offences relating to section 419 read with sections 511, 177 and 182, Indian Penal Code, cannot form the basis of the complaint, since the consent of the State Government or that of the District Magistrate concerned has not been obtained in writing to initiate the proceedings. (f) The complainant has not filed the complaint as a public servant in discharge of his official duties or as a court. (g) The cognizance of the complaint, without examination of the complainant, is vitiated. Point (a) : I see no merit in the same. It is no doubt true that the summons only mention the offence under section 277A of the Income-tax Act, but each of the accused persons has been given a copy of the complaint which mentions in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... de, but not for the purposes of Chapter XXVI of the Code. It is no doubt true that, as per the amendment, every income-tax authority shall be deemed to be a civil court for the purposes of section 195, Criminal Procedure Code. But, in order to attract the provisions of section 136 of the Income-tax Act, there should be a proceeding pending before such income-tax authority. Here, no proceeding is pending before the complainant, namely, the Chief Commissioner (Administration), Commissioner of Income-tax, Tamil Nadu 1, Madras-34, during the relevant time. As such, there cannot be a complaint for offences mentioned in section 195(1)(b) of the Criminal Procedure Code. Section 195(l)(b) of the Code of Criminal Procedure reads as follows "195. (1) No court shall take cognizance - . (b) (i) of any offence punishable under any of the following sections of the Indian Penal Code (45 of 1860), namely, sections 193 to 196 (both inclusive ), 199, 200, 205 to 211 (both inclusive) and 228, when such offence is alleged to have been committed in, or in relation to, any proceeding in any court, or (ii) of any offence described in section 463, or punishable under section 471, section 475 or se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ising under the Indian Penal Code cannot form the basis of the complaint filed by the Chief Commissioner, because any statement recorded from witnesses during the enquiry or probe will be received in evidence and, in case the witnesses go back on their statements, they will be prosecuted for perjury and thereby the witnesses will be compelled to speak only in support of the Department. Whereas in case the offences are investigated, by the police, the witnesses will be at liberty to state the truth before the court and they are not prevented from going back upon the contents of the statement recorded by the investigating agency. Though there is force in the contention of learned counsel for the petitioner, learned counsel for the respondent-complainant has assured that none of the statements recorded by the Income-tax Officer over and above the facts presented before the concerned Income-tax Officer by the accused persons will be used in evidence and as such there cannot be any need for going back upon any statement, since no statements have been recorded by the Income-tax Officer pursuant to the offences which were noticed by him in the returns filed by the concerned accused person ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with reference to offences relating to section 419 read with sections 511, 177 and 182, Indian Penal Code. Points Nos. (f) and (g) : The complainant is the Chief Commissioner (Admn.), Commissioner of Income-tax, Tamil Nadu 1, Madras-34. It cannot be stated that he is not a public servant and that he has not filed the complaint in discharge of his official duties. Further, under the proviso to section 200, Criminal Procedure Code, when the complaint is made in writing, the Magistrate need not examine the complainant and the witnesses if a public servant acting or purporting to act in the discharge of his official duties has made the complaint. Therefore, I see no merit in these two points. In view of my findings in paragraph No. 26, the complaint with reference to the proceedings concerning the main offences mentioned in paragraphs 8, 10(3), 11(1) to (3) and 12(2) of the complaint which are alleged to have taken place at Trivandrum and Bombay is quashed. To make the point clear, even though the prosecution cannot prove the main offences that were alleged to have taken place at Trivandrum and Bombay, it is open to the prosecution to lead evidence with reference to any conspiracy ..... X X X X Extracts X X X X X X X X Extracts X X X X
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