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TMI Blog2016 (3) TMI 1406X X X X Extracts X X X X X X X X Extracts X X X X ..... exceeds one hundred thousand rupees, with rigorous imprisonment for a term which shall not be less than six months but which may extent to seven years and with fine; [ii] in any other case, with imprisonment for a term which shall not be less than three months but which may extend to three years and with fine. Section 279 pertains to prosecution at the instance of Principal Chief Commissioner or Chief Commissioner or Principal Commissioner or Commissioner. Sub-section (2) of Section 279 provides that any offence under this Chapter may, either before or after the institution of proceedings, be compounded by the Principal Chief Commissioner or Chief Commissioner or a Principal Director General or Director General. The Apex Court in case of Prakash Nath Khanna Ors .[ 2004 (2) TMI 3 - SUPREME COURT] held that the expression in due time occurring in Section 276CC means within the time stipulated in Section 139[1] and not the time postulated in Section 139 [4] - filing of the return under section 139 [4], even though without any notice from the Assessing Officer to do so does not satisfy the requirement of section 139 [1] and attracts Section 276-CC. Thus, in view of clear provisions of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under Section 153A of the IT Act was issued to the petitioner and others on 4th September 2013, and in response to which, the petitioner filed her return of income for the A.Y 2011-2012 on 9th October 2014 declaring her total net income at ₹ 2,16,76,260/= and tax payable of ₹ 89,96,690/=. It is the case of the petitioner that because of raid by the Income Tax Department, books of accounts and records were seized which took the petitioner and her family to put the house in order and as a result of which, a bona fide delay occurred in filing the return of income under Section 153A of the IT Act. Moreover, it is the case of the petitioner that she was facing financial problems as a result of which it was not feasible for her to pay tax for want of funds and therefore, the petitioner had to apply for loan from the Bank. This issue was also discussed with the concerned Assessing Officer so also with the Joint Commissioner of Income Tax to whom they had promised to pay up the tax liability on or before 30th November 2014. However, with a view to cooperate and to comply with legal provisions, the petitioner filed return of income where entire undisclosed income had been offer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 153A of the IT Act, and therefore, the present raising various grounds. It is her say that the entire amount has been made by the petitioner by disclosing her income and paying the entire tax on the said income, and therefore, under Section 279[2] of the Income Tax Act, the offence is compoundable, as there is no delay on the part of the petitioner nor any willful default, as the search for the entire group of family had made it impossible for them to recompile all the documents and set their house in order. It is to be noted that the search was conducted in group of cases which involved plethora of documents, and therefore the element of mens rea which is the pre condition of Section 276 CC of the IT Act is completely missing. Neither there is a willful default nor any mens rea for not filing of the IT return. It is also the say of the petitioner that it needs to be proved through clear, cogent and reliable evidence that non filing of the return in time was only on account of willful default on the part of the petitioner. It is also the case of the petitioner that there is neither any presence of mens rea nor any intention for let filing of the return of income, and therefor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ution. Learned advocate Mr. KM Parikh appearing for the Income-tax Department has contended that all the averments raised in the petitioner can be the best of the defences available to the petitioner. However, this Court in a petition for quashing preferred under Article 226 of the Constitution of India need not look into the same. This surely is not a malicious prosecution which would require any interference at this stage. According to him, the reason for interference and quashing the complaint should be so powering and mighty that the Court should choose to so do it at the threshold. Otherwise, this can be examined by the Court concerned at the time of appreciation of evidence. He has sought to reply upon the decisions rendered by the Apex Court in case of Prakash Nath Khanna & Anr. vs. Commissioner of Income Tax & Anr., (2004) 9 SCC 686. Having thus heard both the sides, at the outset, firstly, the law on the subject deserves reproduction. Section 153A of the Income-tax Act provides for assessment in case of search or requisition and depicts that notwithstanding anything contained in section 139, section 147, section 148, section 149, section 151 and section 153, in the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acing reliance on marginal heading or explanatory memo laid before the Parliament at the time of introduction of that section is impermissible. With respect to quashing criminal proceedings under Article 226 of the Constitution of India, the Apex Court held and observed that if the accused challenges the prosecution on the grounds that [a] there was no concealment of income and the allegation of tax evasion was based on no evidence, [b] the delay in filing returns happened in unavoidable circumstances and without any guilty mind, the absence of culpable mental state could be pleaded in defence at the criminal trial and the factual allegations raised by the writ petitioner-accused could then be considered by the trial Court. Apt it would be, to reproduce the relevant findings given in para 21 to 23 of the said decision, which read thus - "21. The term of imprisonment is higher when the amount of tax which would have been evaded but for the discovery of the failure to furnish the return exceeds one hundred thousand rupees. If the plea of the appellants is accepted it would mean that in a given case where there is infraction and where a return has not been furnished in terms of subs ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ble mental state, and absence of such mental state can be pleaded by an accused as a defence in respect to the act charged as an offence in the prosecution. Therefore, the factual aspects highlighted by the appellants were rightly not dealt with by the High Court. This is a matter for trial. It is certainly open to the appellants to plead absence of culpable mental state when the matter is taken up for trial." In wake of the discussions above and the decision of the Apex Court rendered in case of Prakash Nath Khanna & Anr. v. Commissioner of Income Tax & Anr. [Supra], this group of petitions deserve no consideration and are accordingly dismissed. Needless to say that all the contentions raised before this Court by the petitioners shall be available to them at the time of trial and dismissal of these petitions and any of the observations made shall not come in the way of the parties concerned, nor it could be regarded by the Court concerned which shall adjudicate the matters on its own merits. The three decisions of different High Courts which are sought to be relied upon by the learned senior advocate Shri RR Marshall are either at the stage of revision or appeal and all these p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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