Patna High Court - Orders
M/S Darsh Digital Network Private ... vs The State Of Bihar And Ors. on 27 April, 2026
IN THE HIGH COURT OF JUDICATURE AT PATNA
CRIMINAL MISCELLANEOUS No.8516 of 2019
Arising Out of PS. Case No.-129 Year-2017 Thana- GOVERNMENT OFFICIAL COMP.
District- Patna
======================================================
1. M/s Darsh Digital Network Private Limited, and Ors. S/o Parmanand
Yadav ,having its office at 2nd Floor, Suprabhat Building,CEAT Compound,
Exhbition Road, P.S-Kotwali,Distt.-Patna, through its authorized signatory
namely Nilesh Kumar Sinha, resident of Flat no.501, 5th Floor, Judge's
Colony, Near Saguna More, Danapur,P.S-Danapur,Distt.-Patna.
2. Susheel Kumar, S/o Mahendra Roy, resident of Flat no.303, Mansarowar
Garden, Sundram Apartment, Near Board Office, Opposite Hotel President,
Fraser Road, P.S-Kotwali, Distt.-Patna, the Director of M/s Darsh Digital
Network Private Limited
3. Nilesh Kumar Sinha S/o Parmanand Yadav, resident of Flat no.501, 5th
Floor,Judge's Colony, Near Saguna More, Danapur,P.S-Danapur, Distt.-
Patna, the Director of M/s Darsh Digital Network Private Limited
... ... Petitioner/s
Versus
1. The State of Bihar and Ors. Bihar
2. The Commissioner of Income Tax, TDS Circle, Patna Patna.
3. The Assistant Commissioner of Income Tax, TDS Circle, Patna. Patna.
... ... Opposite Party/s
======================================================
Appearance :
For the Petitioner/s : Mr .Parijat Saurav, Adv.
For the Opposite Party/s : Mr. Binod Kumar, APP
For the Income Tax : Mrs. Archana Shahi, Sr. Adv.
======================================================
CORAM: HONOURABLE MR. JUSTICE ANSUL
ORAL ORDER
4 27-04-2026Heard learned counsel for the petitioners, learned APP for the State and learned Sr. Counsel for the Income Tax.
2. The present application has been filed by the petitioner invoking inherent jurisdiction of this Hon'ble Court for quashing the cognizance order dated 30.11.2017 passed by the learned Special Judge, Economic Offences, Patna in Complaint Case No. 129(c)/2017/44(c)/2017 whereby and whereunder the Patna High Court CR. MISC. No.8516 of 2019(4) dt.27-04-2026 2/8 learned Court has taken cognizance under Section 276B read with Section 278B of the Income Tax Act, 1961.
3. The crux of allegation everywhere is that the petitioner was required to deduct the TDS which they deducted but they did not deposit the same within the time stipulated for the same and thus they are facing the instant prosecution.
4. Learned counsel for the petitioner submits that the petitioner no. 1 company is a Multi-Service Operator (MSO) pursuing its business and commerce in Cable TV in the state of Bihar. The Petitioner no. 1 company as Multi System Operator has established control rooms/head-ends and network operations for retransmission of various Free to Air (hereinafter referred to as "FTA") and Pay channels signals of various broadcasters to the affiliated Local Cable Operators (hereinafter referred to as "LCO") across the state of Bihar. The LCOs then retransmit the signals to the premises of the subscribers / consumers via digital and analogue mode. It is stated that till the year 2011, The Cable Television Networks (Regulation) Act, 1995 was the principal Act governing the field of Cable Television Networks. In that Act, it was provided that the addressable system could transmit the signals that were both encrypted and decrypted. In plain terms, there was no mandatory provision for the digitalization of Patna High Court CR. MISC. No.8516 of 2019(4) dt.27-04-2026 3/8 the Cable Television Networks and the signals could be transmitted in analog mode without the aid of set-top box. It is stated that in the year 2011, the Parliament passed The Cable Television Networks (Regulation) Amendment Act, 2011, whereby and whereunder it was provided that the Central Government has the power to make it mandatory for every cable operate to transmit or re-transmit programmes in any channel in Digitalized mode through a Digital Addressable System (hereinafter referred to as "DAS" only) and consequently there shall be blackout of analog signals in such notified areas. The move was intended to bring transparency in the system of Cable Television Network to the benefit all stakeholders, including consumers, cable operators and the Government. However, due to utilization of the funds for meeting the deadline fixed by the central government resulting in paucity of funds, the said TDS amount could not be deposited with the Central Government within the specified time limit. Subsequently, as and when the funds were available with the petitioner company, the petitioner company diligently discharged its statutory liability under the Income Tax and has deposited the deducted/collected TDS to the credit of central government on various dates. The petitioner company has also deposited the statutory interest on the TDS Patna High Court CR. MISC. No.8516 of 2019(4) dt.27-04-2026 4/8 due to its delayed payment. All this exercise of depositing the TDS and the interest was completed by 20th July 2013 itself, and the TDS pertains to the period 01 April 2012 to 31 March 2013. It would be relevant to state here that the provision of Section 201(1A) of the Act provides for payment of Tax deducted along with interest at the rate of 1.5 percent (%) for every month or part of the month on the deducted amount from the date on which Tax was deducted to the date on which such Tax is actually paid. Accordingly, as submitted above, the petitioner company had deposited interest of Rs. 1,38,847.50/- on the delayed payment of TDS. This fact is itself reflected from the chart prepared by the income tax department, which has been enclosed with the show cause notice.
5. Senior Standing Counsel for the Income Tax vehemently opposed the submissions made by the counsel for the petitioners and submits that the petitioners were guilty once as they did not pay the tax which they deducted within time and the diversion of fund as well as delayed payment exposes them to prosecution. She refers to the case reported in 352 ITR 0170 which states that: "In this case, the complaint has been filed under Section 276CC of the Act which is related to non-filling of return, even though on different occasions, notices were given to Patna High Court CR. MISC. No.8516 of 2019(4) dt.27-04-2026 5/8 the petitioners to file necessary return but in spite thereof, the petitioners gave no response which led to filling of the present case, whereas the issue before the Settlement Commission was with regard to different aspect of the matter, as the petitioners deposited the necessary tax and thereafter approached the Settlement Commission, who found the disclosure made by the petitioners to be true and the applicant was agreed to be taxed on the deposits and that was the reason for holding that the applicant cannot be made suffer for this and, accordingly, granted Immunity from the penalty under the Act for all years Involved in the settlement application whereas the Commission has not granted any immunity for the prosecution already launched under Section 276CC of the Act. It is clear that the issue involved before the Commission was quite different whereas the prosecution that has been launched is quite different, l.e. for non-filing the return even after the notice. In this view of the matter, the judgments relied on by the petitioners are not applicable to the present case, as explained hereinabove and the judgments that have been relied on by the respondents are by and large very near to this case and, as such, the order of cognizance cannot beheld to suffer from any Infirmity.".
Patna High Court CR. MISC. No.8516 of 2019(4) dt.27-04-2026 6/8
6. She further relies upon 352 ITR 0161 which states that: "On perusal of aforesaid provision it is evident that petitioner Nos. 2 to 4 are equally responsible for the offences committed by the firm. Moreover, s. 278B, makes it clear that onus lies on the partners or directors to prove that they are not responsible for any of the offence committed by a firm/company. First proviso to s. 278B(1), quoted above, makes it clear that onus lies on the partners or directors to prove that they were not responsible for acts of omission or commission committed by the firm/company. The question as to whether petitioner nos. 2 to 4 were actually involved in this case or not is a question of fact which is to be determined during the trial and onus is on the petitioners to prove that they were not responsible for any act of omission or commission of the firm i.e. petitioner No. 1 M/s Deepak Engineering Works. Accordingly, in view of statutory provisions contained in s. 278B of the IT Act (hereinafter referred to as the IT Act) first submission of learned counsel for the petitioner is not sustainable.".
7. She further relies upon 290 ITR 0199 which clearly states that: "From the relevant provisions, it is clear that wherever a company is required to deduct tax at source and to pay it to the account of the Central Government, failure on the Patna High Court CR. MISC. No.8516 of 2019(4) dt.27-04-2026 7/8 part of the company in deducting or in paying such amount is an offence under the Act and has been made punishable. It, therefore, cannot be said that the prosecution against a company or its directors in default of deducting or paying tax is not envisaged by the Act. It is no doubt true that company is not a natural person but "legal' or "juristic' person. That, however, does not mean that company is not liable to prosecution under the Act. "Corporate criminal liability' is not unknown to law. The law is well-settled on the point. Therefore, it cannot be successfully contended that prosecution could not have been ordered against the company and no charge could have been framed."
8. In view of the aforesaid facts and circumstances, it is the considered opinion of this court that once tax has been deposited and the statutory interest has been paid and there is a clause which could be used for exempting the petitioners from prosecution, in the interest of dockets of this court and in the interest of justice, there is no justification in continuing with the prosecution. Therefore, the cognizance order dated dated 30.11.2017 passed by the learned Special Judge, Economic Offences, Patna in Complaint Case No. 129(c)/2017/44(c)/2017 is hereby quashed Patna High Court CR. MISC. No.8516 of 2019(4) dt.27-04-2026 8/8
9. Accordingly, the application stands allowed.
(Ansul, J) Siddharth Soni/-
U T