9911796707
TMI Blog2009 (1) TMI 50X X X X Extracts X X X X X X X X Extracts X X X X ..... n Case both the cases are disposed of by this common order. 2. The brief facts which are necessary for the disposal of the above cases are set-out below:- (i) The petitioner is the accused in E.O.C.C.No.263 of 1997 on the file of the learned Additional Chief Metropolitan Magistrate, (Economic Offence-I), Egmore, Chennai-8. The respondent filed a complaint for the alleged offence under Section 35B of The Wealth-Tax Act, 1957 (27 of 1957) (hereinafter referred to as 'the Act') in respect of non-filing of the Wealth Tax Return for the assessment year 1993-1994. The gist of the allegations are as under:- (ii) The petitioner is the General Secretary of the political party-All India Anna Dravidar Munnetra Kazhagam (AIADMK). Earlier she was a Member of Parliament (Rajya Sabha). She was also the Chief Minister of Tamil Nadu during the period 1991-1996. Prior to her entry into politics, she was a film artist. The petitioner was assessed to wealth-tax since the assessment year 1966-1967 and as such she is aware of her duties and responsibilities under the Act. For the assessment year 1993-1994, relevant to the valuation date 31.03.1993, the petitioner was in possession and ownership of va ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 17 (B) of the Act, the wealth-tax payable was determined at Rs.1,91,993/- for the assessment year 1993-1994. A show cause notice dated 30.07.1996 was issued calling upon her to show cause as to why prosecution proceedings under Section 35 (B) of the Act should not be initiated against her. In response to the show cause notice a reply dated 04.10.1996 was received from the authorised representative of the petitioner setting out the details for non-filing of the return. It is alleged in the complaint that the petitioner was deliberately bent upon not to file her return of wealth tax at all and may be she has willingly welcomed the ex parte assessment for reasons best known to her. It is further alleged that by deliberately failing to file the return of wealth the petitioner has committed an offence punishable under Section 35 (B) of the Act. (iv) It is further alleged in the complaint that the complaint has been filed in pursuance of the sanction order dated 12.11.1997 passed by the Commissioner of Wealth Tax (Central II), Chennai, under Section 35 (i) of the Act. The said sanction order was filed along with the complaint. (v) Since the complaint had been filed by the respondent ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f proceedings before the Magistrate. In fine, according to the petitioner, the petition under Section 482 Code of Criminal Procedure, 1973, has been filed on the ground that the cognizance taken by the Court on 18.12.1997 in the absence of documents being produced before the Court and merely on the basis of the recitals in the complaint is contrary to law and it is incapable of satisfying either Section 190 or Section 204 of the Code of Criminal Procedure, 1973. 6. In the above Criminal Original Petition the respondent has filed a counter inter alia contending as follows:- 7. The complaint is filed for the offence under Section 35 (B) of the Act for wilful failure to file the return of wealth for the assessment year 1993-1994 and such return has not been filed even up to this date and as such the offence is still continuing in view of the decision of the Apex Court reported in Maya Rani Punj v CIT (1986) 157 ITR 330 (SC) = 1986 (1) SCC 445 The petitioner has suppressed the filing of Crl.O.P.Nos.2759 and 5378 of 1998 before this Court which were dismissed as withdrawn by orders dated 06.03.1998 and 06.02.2001, respectively, and about the time limit fixed by this Court for disposal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ter inter alia contending as follows:- 11. The discharge petition is not maintainable under law. In spite of the statutory notice issued the petitioner wilfully and deliberately failed to file the return of wealth which resulted in passing of an ex parte assessment order. The Department was deprived of knowing the true and correct wealth of the petitioner / accused which she ought to have disclosed voluntarily before the statutory due date. The petitioner had net assessable wealth before the deduction of Income Tax liabilities for the years 1987 to 1993-1994 and it means that the petitioner had sufficient wealth warranting her to file the return of wealth. Had the petitioner filed her return of wealth disclosing her true and correct wealth voluntarily, which is a statutory obligation, there would not have been any deficit wealth even in the consequential order. Not disclosing the true and correct net wealth and thereby inviting an ex parte assessment order and claiming Income Tax liabilities form the assessable net wealth, all have the ingredients of tax-evasion. Therefore failure to file the return of wealth is an independent offence under Section 35B of the Act. 12. It is furt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... al Original Petition is concerned the same has been presented even according to the petitioner, as stated in paragraph 19 of the quash petition, on the ground that the cognizance taken by the Court on 18.12.1997 without any record before the Court except the recitals in the complaint is contrary to law and is incapable of satisfying either under Section 190 or under Section 204 of Code of Criminal Procedure, 1973. It is contended in the quash petition that when a complaint containing merely the recitals without material evidence or materials has to be termed in law as an inchoate complaint which has no legal sanctity and as such the cognizance taken by the Court below is bad in law. It is further contended that any filing of the documents at the later stage cannot cure the initial defect. It is also contended that the wordings of Section 190 (1) (a) and Section 204 of Code of Criminal Procedure, 1973, illustrate that not only the material facts but also the material particulars have to be necessarily included in the complaint. Therefore the learned senior counsel for the petitioner can only canvass the aforesaid ground taken in the quash petition but not the following other grounds ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... .No.5378 of 1998 and other connected Crl.O.Ps. were withdrawn and dismissed by a learned Judge of this Court by an order dated 06.02.2001. It will be relevant to refer to the said order dated 06.02.2001 which reads as follows:- "1. The common endorsement made by the learned counsel for the petitioner in respect of all the above Criminal Original Petition is placed on records. 2. In view of the same, all the above Criminal Original Petitions are dismissed as withdrawn. Consequently, connected Crl.M.Ps. are also dismissed. Interim stay granted in all these cases shall stand vacated. 3. It is open to the petitioner to raise whatever grounds which are open to her under law before the trial court. As the matters relate to the years 1996 to 1998, the concerned trial Judge, E.O.I, Chennai shall dispose of the cases within a period of eight months from the date of the receipt of this order without fail" 21. A reading of the aforesaid order makes it clear that no permission / liberty has been given to the petitioner to file a similar quash petition on the same cause of action but liberty has been given to the petitioner to raise whatever grounds which are open to her under the law befor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ent jurisdiction of this Court under Section 482 Code of Criminal Procedure, 1973. 24. But at the same time it has to be pointed out that the aforesaid ground taken in the present quash petition could not have been taken in the earlier quash petitions since according to the petitioner the non filing of the list of documents mentioned in the complaint came to the knowledge of the petitioner only when the learned Magistrate called for the records from the complainant by his order dated 30.07.2007 passed on the copy application filed by the petitioner in C.A.No.3100 of 2007 dated 23.07.2007. Therefore in the light of the aforesaid facts the present ground taken in the above quash petition could not have been taken in the earlier two quash petitions and therefore the above quash petition should be deemed to have been filed on a fresh cause of action which was not available to the petitioner earlier and hence the preliminary objection raised by the respondent cannot be countenanced. 25. Learned senior counsel for the petitioner while elaborating the contentions raised in the quash petition made the following submissions:- (i)Since the complainant being a public servant there is no ne ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or otherwise to secure the ends of justice. While laying down certain guidelines where the court will exercise jurisdiction under these provisions, it was also stated that these guidelines could not be inflexible or laying rigid formulae to be followed by the courts. Exercise of such power would depend upon the facts and circumstances of each case but with the sole purpose to prevent abuse of the process of any court or otherwise to secure the ends of justice. One of such guidelines is where the allegations made in the first information report or the complaint, even if they are taken at their face value and accepted in their entirety do not prima facie constitute any offence or make out a case against the accused. Under Article 227 the power of superintendence by the High Court is not only of administrative nature but is also of judicial nature. This article confers vast powers on the High Court to prevent the abuse of the process of law by the inferior courts and to see that the stream of administration of justice remains clean and pure. .... 26. Summoning of an accused in a criminal case is a serious matter. Criminal law cannot be set into motion as a matter of course. It is no ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ic person or the persons impleaded then only process would be issued. At that stage the court would be circumspect and judicious in exercising discretion and should take all the relevant facts and circumstances into consideration before issuing process lest it would be an instrument in the hands of the private complaint as vendetta to harass the persons needlessly. Vindication of majesty of justice and maintenance of law and order in the society are the prime objects of criminal justice but it would not be the means to wreak personal vengeance. Considered from any angle we find that the respondent had abused the process and laid complaint against all the appellants without any prima facie case to harass them for vendetta." (d) S.W. Palanitkar v. State of Bihar [2002] 1 SCC 241. In this decision in paragraphs 23, 25 and 27 it is observed as under (page 250):- "23. Many a times, complaints are filed under Section 200 of the Code of Criminal Procedure, 1973, by the parties with an oblique motive or for collateral purposes to harass, to wreck vengeance, to pressurize the accused to bring them to their own terms or to enforce the obligations arising out of breach of contract touching ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , exercise of inherent power is not only desirable but necessary also, so that the judicial forum of court may not be allowed to be utilized for any oblique motive. When a person approaches the High Court under Section 482 of the Code of Criminal Procedure, 1973, to quash the very issue of process, the High Court on the facts and circumstances of a case has to exercise the powers with circumspection as stated above to really serve the purpose and object for which they are conferred." 27. Countering the aforesaid submissions the learned Special Public Prosecutor submitted that if the perusal of the allegations contained in the complaint reveals prima facie the commission of any offence the Court can take cognizance of the same. The material point to be considered at this stage is as to whether the Court while taking cognizance has applied its mind to the allegations in the complaint or not. Since the complaint in this case has admittedly been filed by a Public servant, Sections 192 and 202 of the Code of Criminal Procedure, 1973, have no role to play. Section 192 of the Code of Criminal Procedure, 1973, cannot be made applicable to the complaint in this case which is filed by a Pub ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n the second category the cognizance can be taken straightaway and process issued irrespective of the fact whether it is a case exclusively triable by the Sessions Judge or in other ordinary case. In view of the above discussion it was not necessary for the Chief Judicial Magistrate to have held an inquiry under Section 202 (2), of the Code of Criminal Procedure, 1973, in the case and the impugned order is legal and does not suffer from any infirmity." (ii) Bhimappa Basappa Bhu Sannavar v. L.S. Samagouda 1970 (1) SCC 665. In this decision in paragraph 11 it has been observed as follows (page 668):- "The word 'complaint' has a wide meaning since it includes even an oral allegation. It may, therefore, be assumed that no form is prescribed which the complaint must take. It may only be said that there must be an allegation which prima facie discloses the commission of an offence with the necessary facts for the Magistrate to take action. Section 190(1)(a) makes it necessary that the alleged facts must disclose the commission of an offence." 29. I have carefully considered the above submissions made by the learned counsel on either side, perused the allegations contained in the comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s filed by a private individual but not by a public servant and therefore the sworn statement of the complainant, the documents and the evidence of the witnesses produced by him were recorded and only in that context the aforesaid observation has been made by the Apex Court. But admittedly in this case the complaint has been filed by a public servant and as such the recording of his sworn statement or the evidence on the side of the complainant at that stage does not arise and hence the above said observation made by the Apex Court is not applicable to the facts of this case. Similarly the law laid down in Punjab National Bank's case [1993] Supp 1 SCC 499 and S.W. Palanitkar's case [2002] 1 SCC 241 has no relevance to the facts of this case as the facts of those cases are totally different from the facts of the case on hand. In this case the examination of the witnesses and the production of documentary evidence is yet to commence and even before that the above quash petition has been filed. For taking cognizance the examination of the complainant who is a public servant is not necessary and the production of any documents in support of the allegations contained in the complaint ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... have been set out in detail in the body of the complaint. As laid down in Bhimappa Basappa Bhu Sannavar v. L.S. Samagouda 1970 (1) SCC 665 there must be an allegation which prima facie discloses the commission of an offence with the necessary facts for the Magistrate to take action. Section 190 (1) (a) makes it necessary that the alleged facts must disclose the commission of any offence. Therefore if the learned Magistrate had applied his judicial mind to the allegations contained in the complaint and thereafter has come to the conclusion that such allegations do prima facie reveal the commission of the offence and taken cognizance of the offence no exception can be taken. 36. A perusal of the order passed by the learned Magistrate while taking cognizance of the complaint do reveal that the learned Magistrate has applied his judicial mind to the entire allegations contained in the complaint and only thereafter being satisfied that a prima facie case has been made out has taken cognizance of the offence alleged and has ordered issue of process to the petitioner. The learned Magistrate has passed a detailed order even for taking cognizance of the complaint and this Court finds absol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e wants to deduct any liability the assessee must show the evidence along with the return for such liability, only then the Department can find whether the net wealth of the assessee exceeds Rs.15,00,000/- or not; therefore the filing of the return is mandatory and Section 14 (2) of the Act is not applicable in the case of existing assessees. 42. I have considered the aforesaid submission made by the learned counsel on either side. It has to be pointed out that though the contention based on Section 14 (2) of the Act made by the learned senior counsel looks attractive it has no substance. 43. For better appreciation of the aforesaid contentions put forth by the learned senior counsel for the petitioner it will be useful to refer to the provisions contained in Section 14 of the Act, which reads as follows:- "14. Return of Wealth. - (1) Every person, if his net wealth or the net wealth of any other person in respect of which he is assessable under this Act on the valuation date exceeded the maximum amount which is not chargeable to wealth-tax, shall, on or before the due date, furnish a return of his net wealth or the net wealth of such other person as on that valuation date in t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uirement en-grafted in Section 14 (2) of the Act, that the "return of net-wealth which shows the net-wealth below the maximum amount which is not chargeable", it is ordained to be deemed never to have been furnished. The words "a return of net-wealth which shows" postulates the existence of return filed and can never relate to a return not filed. 46. Further it is pertinent to point out that admittedly in this case the petitioner was already an assesee and as such she cannot evade liability from filing the return. Hence the above contention of the learned senior counsel for the petitioner cannot be countenanced and the same is rejected. 47. The second contention of the learned senior counsel for the petitioner is that when according to section 2 (m), "net wealth" means the assets in excess of the aggregate value of all the debts owed by the assessee as on the valuation date and when the appellate authority accepted the contention of the assessee and in terms of the appellate order, had the assessing officer done the arithmetic work, the net wealth of the assessee would have become in the negative and the question of prosecuting the assessee would not have arisen. It is further co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and become a debt on the last day of the previous year in the case of an income tax liability, on the valuation date in the case of a wealth tax liability and on the last day of the previous year in the case of a gift tax liability." (ii) CWT v. Vadilal Lallubhai (1983) 4 SCC 697; [1984] 145 ITR 7 (SC). In this decision in paragraph 3 the Apex Court has laid down as under:- "3....... When, in the course of a wealth tax assessment, the assessee makes a claim to deduction on account of income tax, wealth tax and gift tax liabilities subsisting as debts owed by him on the valuation date, it is the final quantification of the particular tax liability which must be taken into account. Where the wealth tax assessment so made is carried in appeal, we have no doubt that the Appellate Authority will take into account the ultimate quantification of the tax liability, even though such ultimate quantification has been reached after the relevant valuation date and during the pendency of the wealth tax appeal." (iii) Kesoram Industries v. CWT [1966] 59 ITR 767(SC); (1966) 2 SCR 688. In this decision the Apex Court has laid down as under (page 785 of 59 ITR):- "For the reasons we have stated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... out that as rightly contended by the learned Special Public Prosecutor as against the order dated 16.06.1997 passed by the Commissioner of Income-Tax (Appeals) (IV), Chennai the revenue preferred an appeal before the Income Tax Appellate Tribunal, Chennai Bench, 'A' Chennai in WTA No.293 (MDS)/97 (Assessment year 1993-1994) and the said appeal was allowed in favour of the Revenue by order dated 16.12.2005. In the said order the scope of the amended provision 2 (m) was considered in detail and ultimately it has been held as follows:- "Taking into consideration the entire conspectus of the case we are of the opinion that the income-tax and wealth-tax liabilities cannot be deducted as debts due in relation to taxable assets. We, therefore decide this issue in favour of the Revenue and against the assessee." 51. It is also seen that the Assessing Officer by his order dated 03.07.2006 in G.I.R. No.701 J/93-94 had quantified the wealth tax payable by the assessee as Rs.5,95,617/-. Therefore when the order of the Commissioner of Income Tax (Appeals) IV, dated 16.06.1997 itself has been set-aside by the Tribunal it goes without saying that all the consequential orders / proceedings pass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itioner to expect the criminal court to render a finding as to whether the income tax and wealth tax liabilities are deductible for arriving at the net wealth of the petitioner in the light of the amended provisions contained in Section 2 (m) of the Act. Learned senior counsel himself rightly contended that the Income Tax Act as well as the Wealth Tax Act are self-contained codes and there are several authorities constituted under the said Acts clothed with jurisdiction to pass assessment orders and determine the Income Tax / Wealth Tax liability of the assessees and as such the criminal court cannot decide the tax liability of a person. In the light of the said contention of the learned senior counsel for the petitioner himself this Court is of the considered view that the contentions put forth by the petitioner basing reliance on the provisions contained in Section 2 (m) of the Act ought not to have been raised at all before the Criminal Court. 53. The third submission made by the learned senior counsel for the petitioner is that the assessment proceedings in the case of the petitioner have not reached finality; the assessee has filed a tax case in Tax Case SR Nos.35552 to 35556 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 451 in respect of the assessment year 1982-1983 the appellant firm did not file its return in time but in its income tax return filed belatedly the appellant disclosed a tax liability of Rs.644. Thus it is clear that in that case the return was filed but it was filed belatedly but in the case on hand the wealth-tax return is admittedly not at all filed even as on today. This decision is relied upon in support of the contention that unless and until the wealth-tax assessment proceedings reach finality the assessee cannot be prosecuted for non-filing of the wealth-tax returns. (ii) CIT v. Bhupen Champak Lal Dalal (2001) 248 ITR 830 (SC). In this decision in paragraphs 3 to 5 the Apex Court has laid down as under (page 832) :- "3. The prosecution in criminal law and proceedings arising under the Act are, undoubtedly, independent proceedings and, therefore, there is no impediment in law for the criminal proceedings to proceed even during the pendency of the proceedings under the Act. However, a wholesome rule will have to be adopted in matters of this nature where courts have taken the view that when the conclusions arrived at by the Appellate Authorities have a relevance and bearin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... above decision has no relevance to the facts of the case on hand since the facts of this case are different. Even in this very same decision in paragraph 3 the Apex Court has observed that the prosecution in criminal law and proceedings arising under the Act are, undoubtedly, independent proceedings and, therefore, there is no impediment in law for the criminal proceedings to proceed even during the pendency of the proceedings under the Act. The Apex Court has referred to and relied upon the earlier decisions of the Apex Court reported in G.L. Didwania v. ITO [1997] 224 ITR 687(SC);1995 Supp (2) SCC 724, Uttam Chand v. ITO [1982] 133 ITR 909(SC);(1982) 2 SCC 543;1982 SCC (Tax) 150 and P.Jayappan v. S.K.Perumal, First ITO [1984] 149 ITR 696 (SC);1984 Supp. SCC 437;1985 SCC (Tax) 7. (iii) G.L. Didwania v. ITO [1997] 224 ITR 687(SC);1995 Supp (2) SCC 724. In that case, the assessing authority holding that the appellant / assessee had intentionally concealed his income derived from 'Y' company which belonged to him, initiated prosecution against him. The appellant filed an appeal before the Appellate Tribunal and the Tribunal set-aside the assessment holding that there was no material ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... TR 909 : (1982) 2 SCC 543 : 1982 SCC (Tax) 150, the prosecution once initiated may be quashed in the light of a finding favourable to the assessee recorded by an authority under the Act subsequently in respect of the relevant assessment proceedings but that decision is no authority for the proposition that no proceedings can be initiated at all under Section 276C and Section 277 as long as some proceeding under the Act in which there is a chance of success of the assessee is pending. A mere expectation of success in some proceeding in appeal or reference under the Act cannot come in the way of the institution of the criminal proceedings under Section 276C and Section 277 of the Act. In the criminal case all the ingredients of the offence in question have to be established in order to secure the conviction of the accused. The criminal court no doubt has to give due regard to the result of any proceeding under the 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 does not, however, mean that the result of a proceeding under the Act would be binding on the criminal court. The criminal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iance on P.Jayappan's case [1984] 149 ITR 696 (SC) the learned senior counsel for the petitioner submitted that since the tax case filed by the petitioner is still pending even if this Court is of the view that the criminal proceedings cannot be quashed or the revision is not allowed a direction may be issued to the learned Magistrate to stay all further proceedings in the case and await the out come of the Tax Case pending before this Court. 57. Learned senior counsel for the petitioner based reliance on the decision reported in State of Bihar v. Deokaran Nenshi (1972) 2 SCC 890. In this decision in paragraphs 5 and 9 the Apex Court has observed as under (page 892):- "5. A continuing offence is one which is susceptible of continuance and is distinguishable from the one which is committed once and for all. It is one of those offences which arises out of a failure to obey or comply with a rule or its requirement and which involves a penalty, the liability for which continues until the rule or its requirement is obeyed or complied with. On every occasion that such disobediance or non-compliance occurs and reoccurs, there is the offence committed. The distinction between the two ki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... appropriate case the criminal court may adjourn or postpone the hearing of a criminal case in exercise of its discretionary power under Section 309 of the Code of Criminal Procedure if the disposal of any proceeding under the Act which has a bearing on the proceedings before it is imminent so that it may take also into consideration the order to be passed therein. He further submitted that in this case, even according to the petitioner, the Tax Case has been filed with a huge delay and the delay itself is yet to be condoned and thereafter the tax case is to be disposed of and it is not certain as to when the Tax Case will be finally disposed of and therefore submitted that when the disposal of the proceedings under the Act namely the Tax Case pending before this Court is not imminent there is no scope for either adjourning or postponing the hearing of the criminal case. He further pointed out that in the very same decision the Apex Court itself has observed that there is no rigid rule which makes it necessary for a criminal court to adjourn or postpone the hearing of a case before it indefinitely or for an unduly long period only because some proceeding which may have some bearing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n exercise of its discretionary power under Section 309 of the Code of Criminal Procedure if the disposal of any proceeding under the Act which has a bearing on the proceedings before it is imminent so that it may take also into consideration the order to be passed therein. But in this case, even according to the petitioner, the Tax Case has been filed with a huge delay and the delay itself is yet to be condoned and thereafter the tax case is to be disposed of and it is not certain as to when the Tax Case will be finally disposed of and therefore when the disposal of the proceedings under the Act namely the Tax Case pending before this Court is not imminent there is no scope for either adjourning or postponing the hearing of the criminal case. In the very same decision, the Apex Court itself has observed that "there is no rigid rule which makes it necessary for a criminal court to adjourn or postpone the hearing of a case before it indefinitely or for an unduly long period only because some proceeding which may have some bearing on it is pending elsewhere. But this, however, has no relevance to the question of maintainability of the prosecution. The prosecution in those circumstanc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... therefore the non-filing of the return even after the issuance of a notice under Section 16 (4) of the Act cannot be construed to be wilful. Before the learned Magistrate a contention has been raised by the petitioner that the notice issued under Section 16 (4) of the Act is not a proper notice and it was also not properly served on the assessee. While considering the aforesaid contention the learned Magistrate has observed that the question whether the notice issued by the Department asking the assessee to file the report is issued under correct provision of law and whether that notice was properly served on the person can be proved only during the trial by letting in oral and documentary evidence by the prosecution. The learned Magistrate has further observed that even the alleged notice has not been marked as an exhibit to enable the Court to look into it and hence has not considered the said contention on merits. According to the learned senior counsel, the learned Magistrate has erred in making such observation and submitted that the said contention ought to have been considered by the learned Magistrate on merits. 65. Countering the said submissions the learned Special Publi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ade a return (within the time allowed under sub-section (1) of section 14 to furnish a return of his net wealth or the net wealth of any other person in respect of which he is assessable under this Act on the valuation date, in the prescribed form and verified in the prescribed manner, setting forth the particulars of such net wealth and such other particulars as may be prescribed, or (ii) to produce or cause to be produced such accounts, records or other documents as the Assessing Officer may require. (5) if any person - (a) fails to make the return required under sub-section (1) of section 14 and has not made a return or a revised return under section 15, or (b) fails to comply with all the terms of a notice issued under sub-section (2) or sub-section (4), the Assessing Officer, after taking into account, all relevant material which he has gathered, shall, after giving such person an opportunity of being heard, estimate the net wealth to the best of his judgment and determine the sum payable by the person on the basis of such assessment." 68. 54. Section 17 of the Act reads as under:- "17. Wealth escaping assessment. - (1) If the Assessing Officer has reason to believe th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to be specified therein - where such person has not made a return within the time allowed under sub-section (1) of section 14 to furnish a return of his net wealth in the prescribed form and verified in the prescribed manner setting forth the particulars of said net wealth and such other particulars as may be prescribed. If any person fails to comply with all the terms of the notice issued under sub-section (4) the Assessing Officer after taking into account all relevant material which he has gathered shall after giving such person an opportunity of being heard estimate the net wealth to the best of his judgment and determine the sum payable by the person on the basis of such assessment. Admittedly in this case the assessee / petitioner had not filed the return for the assessment year 1993-1994 within the due date and hence the Assessing Officer had issued the notice under Section 16 (4) of the Act and thereafter by following the procedure prescribed under Section 16 has passed the best judgment assessment. The aforesaid facts are not in dispute. 71. Whereas section 17 deals with cases relating to escaped assessment and it is not the case of the learned senior counsel for the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ution and that is on the shoulder of the accused to prove the absence of mental state, without considering that the prosecution was duty bound to make out a prima facie case of wilfulness to warrant further consideration of a complaint, which the prosecution had failed to do in the case on hand." 73. The Learned Senior Counsel for the petitioner did not advance any arguments in that regard. On the contrary the learned Special Public Prosecutor wanted to make submissions relating to mens rea on the part of the assessee in not filing the returns, but this Court did not permit him to advance any arguments by pointing out that it is the function of the trial court at the conclusion of the trial and on the basis of the evidence to be let in to decide the question of mens rea and its rebuttal by the petitioner. 74. In the decision reported in Prakash Nath Khanna v. C.I.T. (2004) 9 SCC 686; (2004) 266 ITR 1(SC) the Apex Court while considering Section 278E of the Income-Tax Act which is in pari-materia with section 35-O of the Act has held as under (page 12):- "There is a statutory presumption prescribed in Section 278E. The court has to presume the existence of culpable mental state, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... any rights concretised in favour of the accused". In the light of the aforesaid observations made by the Hon'ble Apex Court if the order of the learned Magistrate is considered it could be seen that the learned Magistrate has considered all the submissions made by both sides, has framed the points for consideration, has dealt with each of them and has come to the conclusion that some of the questions raised by the petitioner must be decided, substantiated and adjudicated at the time of trial. 78. It has to be pointed out that the learned Magistrate in his detailed order has considered all these aspects and applied the correct principles of law to the facts of this case and as such I find absolutely no reason to interfere with the order. For the reasons stated above the above Criminal Revision Case fails and the same is dismissed. 79. Before parting with the case this Court wants to refer to the submission made by the learned Special Public Prosecutor regarding the long pendency of the case before the Trial Court. The learned Special Public Prosecutor vehemently contended that the petitioner had sought for more than 180 adjournments and had not allowed the prosecution to commence ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
