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TMI Blog2021 (9) TMI 1558X X X X Extracts X X X X X X X X Extracts X X X X ..... bmitted that applicant had filed his return of income belatedly on 31.03.2017 for the assessment year 2015- 16 declaring totaling income of Rs. 24,12,050/- (twenty four lakhs twelve thousand fifty) and had deposited a sum of Rs. 8,28,930/- (eight lakhs twenty eight thousand nine thirty) as self assessment tax on 31.03.2017 alongwith interest payable under Section 234-A and 234-C amounting to Rs. 82,892/- (eighty two thousand eight hundred ninety two), though as per the provisions contained in Section 139(1) of the Act, he was required to file his return of income on or before 07.09.2015. 4. It is submitted that the Deputy Commissioner of Income Tax, Circle- 3, Varanasi filed a complaint in his official capacity at the instance of the Principal Commissioner of Income Tax, Varanasi on being authorized and granted sanction under Section 279(1) of the Act on 08.01.2018. 5. It is mentioned in the sanction order that a show cause notice was sent to the applicant on 30.11.2017 by speed post asking the applicant to appear and file reply on or before 15.12.2017, but despite service of show cause notice on 06.12.2017 and even thereafter applicant did not file any reply nor attended office ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng of appeals by department before Appellate Authorities would apply even to pending matters, but subject to two caveats that this circular would not be applied by the High Courts Ipso facto, when matter had a cascading effect and where common principles may be involved in a subsequent group of matters or a large number of matters. 10. Reliance is also placed on the judgment of Supreme Court in case of S.C. Naregal Vs. Commissioner of Income Tax and others; [2019 (418) ITR 455 (SC)], wherein again, it is held that instructions of C.B.D.T. No.05 of 2008 dated 15.05.2008 revising monitory limit to file appeal would apply even to pending matters when, there was no possibility of cascading effect, nor issue was involved in group of matters, it has been answered in affirmative in favour of the assessee. 11. Reliance is also placed on order of co-ordinate Benches in Application under Section 482 No.2736 of 2003 (Chhotey Lal Vs. Union of India and another) and Application under Section 482 No.2730 of 2003 (Chhotey Lal Vs. Union of India and another) dated 09.01.2017, wherein, on concession by the learned counsel for the opposite party no.2 that there is Circular of C.B.D.T. to the effec ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... -CC of the Income Tax Act, 1961, there is failure to furnish returns of income and they were filed late for relevant assessment years for reasons that due to indisposition of its clerk, day-to-day accounts could not be finalized and that partners were not conversant with preparation of profit and loss account and balance-sheet, however, assessee had paid not only advance tax but also penal interest and penalty for late filing of returns. It is held that in absence of presence of mens-rea or bad motive and guilty mind on the part of the assessee, its partner could not be prosecuted under Section 276-CC. 16. Reliance is also placed on judgment of High Court of Madhya Pradesh in case of Narayan Vs. Union of India; [1994 (208) ITR 82 (M.P.)] wherein, the ratio is that, it is not merely failure to file return in time which constitutes offence under Section 276-CC of the Income Tax Act, 1961, but failure to file return in time must be proved by clear, cogent and reliable evidence to be wilful and there should be no plausible doubt of its being wilful. It is held that ingredients of delay being wilful being not proved beyond reasonable doubt by prosecution, therefore, petitioner was to b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Mahakali Rolling Mills Vs. Union of India and others; (2007) 12 SCC 198, wherein words 'now', used in circulars and clarifications on excise and customs circulars dated 31.03.1987 has been interpreted and it is held that the effect of the word "now" is that it is to operate henceforth. If the intention was to give retrospective effect, it would have been stated to be so specifically. 22. In para-9, it is held that "Retrospective" means looking backward, contemplating what is past, having reference to a statute or things existing before the Statute in question. Retrospective law means a law which looks backward or contemplates the past; one, which is made to affect acts or facts occurring, or rights occurring, before it comes into force. Retroactive statute means a statute, which creates a new obligation on transactions or considerations or destroys or impairs vested rights. 23. Reliance is also placed on the judgment of Supreme Court in Prakash Nath Khanna and others Vs. Commissioner of Income Tax and others; [2004 (266) ITR 1 (SC)], wherein it is held that one of the significant terms used in Section 276-CC is 'in due time'. The time within which the return is to be furnished i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ture without any purpose or intent specified only the sub-Sections (1) and (2) and the conspicuous omission of sub-Section (4) has no meaning or purpose behind it. Sub-Section (4) of Section 139 cannot by any stretch of imagination control operation of sub-Section (1), wherein, a fixed period for furnishing the return is stipulated. The mere fact that for purposes of assessment and carrying forward and to set-off losses, it is treated as one filed within sub- Sections (1) or (2) cannot be pressed into service to claim it to be actually one such, though, it is factually and really not by extending it beyond its legitimate purpose. 24. It is further held that whether there was wilful failure to furnish the return is a matter which is to be adjudicated factually by the court, which deals with the prosecution case. It is held that there is a statutory presumption prescribed in Section 278-E. The Court has to presume the existence of culpable mental state, and absence of such mental state can be pleaded by an accused as a defense in respect to the act charged as an offence in the prosecution. Therefore, the factual aspects highlighted by the applicants were rightly not dealt by the Hig ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Vs. Union of India (UOI) and others; (2012) 6 SCC 613. 29. Judgment in case of State of Orissa and others Vs. Mohd. Illiyas (supra) is also in relation to the interpretation of the provisions of Orissa Gram Panchayat Act and will again be not covered by the law laid down by Supreme Court in regard to interpretation to the fiscal laws. 30. Judgments given by various High Courts of Andhra Pradesh in case of Income Tax Officer Vs. Autofil (supra), High Court of Madhya Pradesh in case of Narayan Vs. Union of India (supra), High Court of Madras in case of Rajkumar Thiyagarajan Vs. Income Tax Department, Madurai (supra) turn on to their own facts. In fact, High Court of Madras has not taken into consideration law laid down by Supreme Court in case of Prakash Nath Khanna and another Vs. Commissioner of Income Tax and another (supra), where judgment was delivered on 16.02.2004. 31. Judgment in case of Suresh Sholapurmath Vs. Income Tax Department (supra) is also distinguishable on its own facts, inasmuch as, Supreme Court quashed the proceedings as the amount involved was meagre and below Rs. 25,000/- and was already paid with interest long ago. Thus, it held that amount involved was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n Singh and others Vs. State of M.P.; AIR 1965 SC 1583 (para-5) has held that the reading of 'or' as 'and' is not to be resorted to, "unless some other part of the same statute has the clear intention of it requires that to be done. 37. In case of Union of India (UOI) and Ors. vs. Ind- Swift Laboratories Ltd. (2011) 4 SCC 635, In Para-18, it is held that where provision is clear and unambigous the word 'or' cannot be read as 'and' by applying the principle of reading down. 38. Thus, when examined in light of said legal position, then the argument that applicant had already furnished his return in terms of Section 139 (4) will not take away the liability of filing the return 'in due time' as mentioned in Section 276-CC, merely because no notice was issued prior to filing of the return. 39. Law laid down in case of State of Orissa and others Vs. Mohd. Illiyas (supra) deals with situation, which are bona fide or unintentional or genuine inability. Applicant was, if acting bonafidely was obliged to explain his acts to be bonafide or unintentional or genuine inability by furnishing his explanation, which is not on record accept a bald assertion that notice under Section 139(2) was no ..... X X X X Extracts X X X X X X X X Extracts X X X X
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