High Court revives prosecution for not filing return. An indefinite period for compliance can never be the intention of the law
ABCAUS Case Law Citation:
ABCAUS 2553 (2018) (10) HC 
Important Case Laws Cited/relied upon by the parties:
Sasi Enterprises v. Assistant Commissioner of Income Tax (2014) 5 SCC 139
The petitioner had failed to submit his return of income-tax for three assessment years within the time stipulated under Section 139 (1) of the Income Tax Act, 1961 (Act).
For repeated non compliance of notices issued under Section 142 (1) and 148 of the Act, prosecutions were launched by the Income Tax Department (Revenue) by filing of criminal complaints, each alleging offence punishable under Sections 276 CC of the Act having been committed qua different assessment years by him.
The Trial Magistrate ordered charge to be framed separately for each assessment year.
The orders of the Trial Court framing charge were challenged by the accused in the court of Sessions. In respect of two assessment years, orders of the trial magistrate upheld. However, the revisional court allowed the petition of the accused and the accused was discharged.
The Revenue filed petition invoking the jurisdiction of the High Court under Section 482 Cr.P.C. to further challenge the order of the revisional court against the discharge as above.
However, the case of the accused was that notice under Section 142 (1) of the Act had been followed by a fresh notice and since the said notice had not indicated any date by which compliance was to be made. Therefore, the assessee could not be said to have committed breach of the statutory obligation and, consequently, he could not be prosecuted for offence under Section 276 CC of the Act.
The Hon’ble High Court found that the above contention of the accused assessee was accepted by the Revisional Court on the reasoning that the subsequent notice calling him upon to furnish the information for which no time was stipulated, such notice also being in exercise of power under Section 142 (1) and thus having superseded the previous notice.
The Hon’ble High Court observed that Section 139 of the Act creates an obligation on the part of every person whose total income assessable during the previous year exceeds the maximum amount which is not chargeable to income-tax to furnish a return of his income on or before the prescribed date, in the prescribed form, duly verified in the prescribed manner, setting forth such other particulars as may be prescribed.
Further, provision contained in Section 142 of the Act confers jurisdiction on the Assessing Officer (AO) to hold an inquiry before assessment and for such purposes to serve on the person concerned, who may or may not have furnished the return in terms of Section 139, a notice requiring him, inter alia, to furnish in writing and verified in the prescribed manner, information in such form and on such points or matters as the assessing officer may require. Section 148 further confers on the assessing officer the power and jurisdiction to issue notice to require information to be furnished in cases where the income appears to have escaped assessment.
The Hon’ble High Court observed that the offence under Section 276 CC of the Act deals with failure to comply with the obligation under Sections 139 (1) or 142(1) or 148 of the Act. Disobedience of each said provision of law itself constitutes a distinct offence. The offence under Section 276 CC, prima facie, stood constituted upon failure on the part of the assessee to furnish the return of income for the assessment year in question within the period prescribed in law.
It was noted that undisputed fact was that the accused had not submitted the returns of his income within the period stipulated in terms of Section 139 (1) and notices had been issued under Section 142 (1) by the assessing officer and in spite of even the said notices, the required information was not furnished within the period specified therein.
The Hon’ble High Court stated that the evidence of complainant had shown disobedience of Section 139 (1) by failure on the part of the assessee to furnish the return of income. The notice under Section 142 (1) which had been served had also not been complied with. This added to the gravity and to the reasons for filing of the criminal prosecution. The subsequent notice cannot prima facie be read so as to supersede the previous notice particularly to have the effect of giving to the assessee indefinite period for compliance since that can never be the intention of the law or of the process issued thereunder. The fact that the assessee had subsequently furnished the return of income can also not take away from the fact that he had incurred the liability to be prosecuted earlier on account of failure to furnish the income-tax return within the stipulated period.
The Hon’ble High Court opined that the revisional court took the correct view in the case of complaints relating to two AY but fell into error in the context of complaint relating to the assessment year in question despite there was no case made out for discharge of assessee in the said case.
The impugned order of the revisional court was set aside reviving proceedings in the corresponding on the file of the Trial Court.
