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TMI Blog1987 (8) TMI 24X X X X Extracts X X X X X X X X Extracts X X X X ..... nal facts will help to resolve the issues raised in these petitions : The petitioners are carrying on business in the name and style of M/s. Bhasin Tent House, Sector 27-D, Chandigarh. D. N. Bhasin filed income-tax returns for the assessment years 1979-80, 1980-81 and 1981-82 declaring therein total incomes of Rs. 14.990, Rs. 19,180 and Rs. 2,5,140 respectively, while Smt. Kanta Bhasin filed her income-tax returns for the assessment years 1979-80, 1980-81 and 1981-82, declaring therein total incomes of Rs. 20,340, 30,840 and Rs. 30,600, respectively. The assessments for the years 1979-80 and 1980-81 were completed on October 23, 1979, and October 23, 1980, respectively, in the case of D. N. Bhasin, whereas assessments for the assessment y ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... these two years. The Commissioner of Income-tax, Patiala, granted sanction under section 279(1) of the Act authorising the Income-tax Officer, Chandigarh, to file a complaint against the petitioners under sections 276C and 277 of the Act for the assessment years 1980-81 and 1981-82. Thereafter, the Income-tax Officer filed complaints against the petitioners which are pending in the court of the Chief judicial Magistrate, Chandigarh. The Income-tax Officer framed best judgment assessments against the petitioners under section 144 of the Act, in relation to the assessment years 1979-80, 1980-81 and 1981-82, and added certain amounts to the income of the petitioners and reframed the assessments on that basis. The petitioners, aggrieved by th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... atements in their verification of the returns filed by them which were false was the finding of the Income-tax Officer. In view of the categoric findings of the Commissioner of Income-tax (Appeals) that the additions to the incomes of the petitioners were not justified and the same were liable to be deleted, it cannot be said that the petitioners had tried to evade any tax or had made any false statements in the verification of their returns. It was contended by Shri A. K. Mittal, learned counsel appearing on behalf of the Revenue, that the decision of the Commissioner of Income-tax (Appeals) was not conclusive regarding the conduct and criminality of the petitioners. This matter had to be tried by the Criminal Court which is entitled to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e criminal court that the appellate authority had quashed the order of the Income-tax Officer in appeal filed by him and hence the criminal proceedings pending against him should be quashed. He also relied upon a decision of the final court in Uttam Chand v. ITO [1982] 133 ITR 909 (SC) and decision of this court in Parkash Chand v. ITO [1982] 134 ITR 8. The learned Magistrate repelled the contentions of the assessee, because he was of the view that in the absence of some evidence on the record, it would be premature to pronounce on the matter. The assessee filed a petition under section 482, Criminal Procedure Code 1973, assailing the orders of the Magistrate. M. M. Punchhi J. allowed the petition, relying on the decision of the Supreme Cou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ard counsel, special leave granted. In view of the finding recorded by the Income-tax Appellate Tribunal that it was clear on the appraisal of the entire material on the record that Shrimati Janak Rani was a partner of the assessee-firm and that the firm was a genuine firm, we do not see how the assessee can be prosecuted for filing false returns. We, accordingly, allow this appeal and quash the prosecution. There will be no order as to costs." It is thus manifest that the findings of the Commissioner of Income-tax (Appeals) are relevant and the criminal court is required to act upon them. If the Commissioner of Income-tax (Appeals) came to the conclusion that the additions made to the income of the petitioners (assessees) were not justif ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . The High Court dismissed the petitions. Thereafter, the assessee filed a special leave petition before the Supreme Court and it was in this context that it was observed that the criminal court no doubt has to give due regard to the result of any proceedings under the Income-tax Act having a bearing on the question in issue and in an appropriate case, it may drop the proceedings in the light of an order passed under the Act. It was further observed that it did not, however, mean that the result of a proceeding under the Act would be binding on the criminal court. The criminal court has to judge the case independently on the evidence placed before it. It thus appears that the facts in P. Jayappan's case [1984] 149 ITR 696 (SC) were not at a ..... X X X X Extracts X X X X X X X X Extracts X X X X
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