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TMI Blog2022 (3) TMI 1038X X X X Extracts X X X X X X X X Extracts X X X X ..... appearing for the O.P. No. 2 (Income Tax Department). 2. In all these petitions, common questions of facts are involved, as such, all the matters have been heard together with the consent of the parties and are being disposed of by this common order. 3. These criminal miscellaneous petitions have been filed for the following reliefs:- (1) For quashing of the cognizance order dated 28.03.2018 passed by the learned Special Judge, Economic Offences, Dhanbad, whereby cognizance has been taken against the petitioners for the offences under Sections 276(B) and 278(B) of the Income Tax Act, in connection with Economic Offence Case [C.O. No. 23 of 2018], as well as the entire criminal proceedings [in Cr.M.P. No. 2941 of 2018]. (ii) For quashing of the cognizance order dated 09.02.2018 passed by the learned Special Judge, Economic Offences, Dhanbad, whereby cognizance has been taken against the petitioner for the offences under Section 276(B) of the Income Tax Act, in connection with Economic Offence Case [C.O. No. 01 of 2018] as well as the entire criminal proceedings [in Cr.M.P. No. 2942 of 2018]. (iii) For quashing of the cognizance order dated 27.03.2018 passed by the learned S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... deep Ganguly, Assistant Commissioner, Income Tax Department, stating therein [in Cr.M.P. No. 2941 of 2018]:- The prosecution case as narrated in the complaint case filed by one Sri Sandip Ganguly, in discharge of his official duty on the strength of sanction order and direction as well as authorization given by the Commissioner of Income Tax (TDS) has been filed for offence allegedly committed under section 276(B) and 278(B) of the Income Tax Act wherein it has been stated that the accused no.1 is a partnership firm having TAN-RCHA0613DG and is an assessee within the meaning of Income Tax Act under T.D.S. Ward Circle, I.T. Department, Dhanbad and the accused no.2 is the principal officer of accused no.1 having PAN-AYDPS0747D and was/ is quite aware of the day to day conduct of the business and entire business affairs of the accused no.1 and actively participating in the function and management of affairs of the accused no.1 and being a principal officer as per section 2(35) of the I.T. Act of the accused no.1 he was liable and responsible to the partnership firm for the conduct of the business of the partnership firm i.e. accused no.1 for each and every act done by him or by any o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... om Private Limited filed letter which has no legs to stand. It has further been alleged that after considering the aforesaid facts and circumstances as discussed above a proposal for launching a prosecution for commission of offence under section 276B r/w 278B of the Income Tax Act against the accused persons was sent to the Honorable Commissioner of Income Tax, T.D.S. Ward, Patna for granting sanction to launch of prosecution under section 276B r/w section 278B of the I.T. Act against the accused persons. It has further been alleged that taking into account the aforesaid facts and circumstances that the accused no.2, who was quite aware of the conduct of the business and day to day affairs of the business of accused no.1 and accused no.2 was liable and responsible for making payment of T.D.S amount deducted at source for and on behalf of the accused no.1. As per the list attached herewith in due time in the light of the provisions laid down under section 194C of the Income Tax Act but the accused persons intentionally, knowingly, deliberately and having mens rea in mind without reasonable cause excuse and explanation failed to make payment of TDS amount as discussed above and ad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... S amount has been deducted by the petitioners, which were deposited with certain delay, however, in terms of Section 201(A) of the Income Tax Act, the amount was deposited along with interest. He further submits that the petitioners received the show causes for initiation of the criminal proceedings against them, however, the same were replied. According to him once the TDS amount has been deposited along with the interest there was no occasion to initiate the prosecution, under Sections 276(B) and 278(B) of the Act. He draws the attention of this Court to that Sections and submits that these Sections itself is very clear, which say that in case of failure to pay tax to the credit of Central Government, the prosecution can be launched. He further submits that the prosecution against the petitioners under Sections 276(B) and 278(B) of the Act is mechanical and contrary to the instructions, bearing F. No. 255/339/79-IT (Inv.) dated 28.05.1980, issued in this regard by the CBDT, wherein, it has been mentioned that prosecution under Section 276-B of the Act should not normally be proposed when the amount involved and / or the period of default is not substantial and the amount in defa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ose cases, the amount in question was meager and delay in lodging the prosecution is about 3 to 4 years. She submits that in the cases is hand the prosecution case was immediately lodged and the judgment relied by the learned counsel appearing for the petitioner are not applicable in this case. She submits that in view of Rule-30(2) of the Act, the deducted amount is required to be paid by the 7th day of the next subsequent month, which has not been done in the present cases. 10. For ready reference Rule-30(2) of the said Act is quoted hereinbelow:- "30. ................. (2) All the sums deducted in accordance with the provisions of Chapter XVII-B by deductors other than an office of the Government shall be paid to the credit of the Central Government. (a) on or before 30th day of April where the income or amount is credited or paid in the month of March; and (b) in any other case, on or before seven days from the end of the month in which- (i) the deduction is made; or (ii) income tax is due under sub-section (1A) of section 192." 11. To buttress her arguments so far as the criminal prosecution and civil liability are concerned, she relied upon in the case of Income ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ined to entertain this application at this stage. In a given case whether there is just and sufficient reason for not depositing the tax deducted at source is always a question of fact depending upon appreciation of the evidence produced before the court. The pleas taken by the petitioner in this writ application will all be available to them in the criminal trial and if they can establish that those are sufficient, the criminal prosecution will fail. But at this stage, there is no scope for pre-empting the said criminal proceeding by entertaining this writ application. The position, however, would have been different if the petitioner would convince this court that even if the allegations made by the respondents were all true those facts did not constitute any offence under Section 276B of the Income Tax Act. I, thus, find no reason to entertain this application at this stage in view of the fact that the questions involved are all disputed questions of facts to be gone into on consideration of the evidence." 14. On these grounds she submits that this Court may not exercise its power under Section 482 Cr.P.C. at this stage. 15. In view of the above facts and arguments of both the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fidavit of the Income Tax Department, wherein the date of deduction and date of depositing the said amount has been mentioned. However, some delay occurred in depositing the TDS. Apart from one or two cases, the deducted amount are not more than 50,000/-. While passing the sanction under Section 279(1) of the Act, the sanctioning authority has not considered the CBDT instructions, bearing F. No. 255/339/79-IT (Inv.) dated 28.05.1980, issued in this regard by the CBDT. The CBDT guidelines was considered by the Patna High Court in the case of Sonali Autos (P) Ltd. (Supra) and after considering this guidelines, the Court has interfered with the matter and quashed the entire criminal proceedings. In CBDT instructions, it is mentioned that prosecution under Section 276(B) of the Act shall not normally be proposed when the amount involved and / or the period of default is not substantial and the amount in default has also been deposited in the meantime to the credit of Government. No such consideration will, of course, apply to levy of interest under Section 201(1A) of the Act. This is quoted in the case of Sonali Autos (P) Ltd. (Supra). Moreover after receiving the deducted amount with ..... X X X X Extracts X X X X X X X X Extracts X X X X
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