Person convicted u/s 276B unless minor, can not be released on probation of good conduct

Person convicted u/s 276B, unless minor, can not be released on probation of good conduct. Order of the Trial Court set aside by Special Judge of TIS Hazari Court

ABCAUS Case Law Citation:
ABCAUS 2257 (2018) (03) TC

Section 276B of the Income Tax Act, 1961 (the Act) inter alia provides for prosecution for failure to pay tax deducted at source to the credit of the Central Government under Chapter XVII-B of the Act.

As per the section non deposit of TDS after deduction shall render the concerned person punishable with rigorous imprisonment for a term between 3 months to seven years. The imprisonment is in addition to the fine.

In a recent order passed by a Special Judge, TIS Hazari Court, New Delhi (hereinafter, “the Court”)  has set aside an order passed by the Additional Chief Metropolitan Magistrate (Trial Court) passed with respect to an offence under Section 276B of the Act.

The accused principal officer of the deductor company was facing Trial before the Trial Court on the accusation that after deduction of Tax Deducted at Source, the said amount was not deposited in the account of Government within the prescribed period. The Company  was  also held guilty for the  offence read with Section 278B of the Act.

It was noted that the Trial Court instead of sentencing the accused appellant to imprisonment, ordered for his release on probation on furnishing personal bond  with  one  surety for a period of six months with direction to pay cost of litigation.

Before the Court, the Income Tax Department submitted that order on sentence passed by Trial Court was not in consonance with the law as accused could not be released on probation.

The Court observed that under the Income Tax Act, 1961, it has been specifically  provided  under Section 292A unless the person convicted of an offence under the Act is less  than  18 years of age, he or she  cannot  be  released on  probation  of  good  conduct.   

Accordingly, the Court set aside the order of the Trial Court on sentence and remanded the matter back to pass  order on sentence afresh in accordance with law