Gujarat High Court
Jayantibhai Tapubhai Ambalia vs State Of Gujarat on 20 July, 2023
NEUTRAL CITATION
R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023
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IN THE HIGH COURT OF GUJARAT AT AHMEDABAD
R/CRIMINAL MISC.APPLICATION NO. 8222 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12431 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12434 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12424 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12417 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12423 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12433 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12432 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12435 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12427 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12430 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12419 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12441 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12413 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12409 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12418 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12428 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12436 of 2019
With
R/CRIMINAL MISC.APPLICATION NO. 12450 of 2019
FOR APPROVAL AND SIGNATURE:
HONOURABLE MR. JUSTICE SANDEEP N. BHATT
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NEUTRAL CITATION
R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023
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1 Whether Reporters of Local Papers may be allowed Yes
to see the judgment ?
2 To be referred to the Reporter or not ? Yes
3 Whether their Lordships wish to see the fair copy No
of the judgment ?
4 Whether this case involves a substantial question No
of law as to the interpretation of the Constitution
of India or any order made thereunder ?
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JAYANTIBHAI TAPUBHAI AMBALIA
Versus
STATE OF GUJARAT
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Appearance:
MR TUSHAR L SHETH(3920) for the Applicant(s) No. 1
MR KARAN SHANGHANI, ADVOCATE FOR MRS KALPANAK RAVAL(1046)
for the Respondent(s) No. 2
MR SOAHAM JOSHI, APP for the Respondent(s) No. 1
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CORAM:HONOURABLE MR. JUSTICE SANDEEP N. BHATT
Date : 20/07/2023
COMMON ORAL JUDGMENT
1. Rule returnable forthwith. Mr. Soaham Joshi, learned APP waives service of notice of rule for and on behalf of respondent no.1 - State.
2. Since the issues raised in all the captioned applications are more or less the same, those were heard analogously and are being disposed of by this common judgment and order. Page 2 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023
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3. For the sake of convenience, the Special Civil Application No.8222 of 2019 is treated as the lead matter.
4. By way of present petition, the petitioner has prayed for the following reliefs:-
14(A) be pleased to allow the present petition;
(B) be pleased to quash and set aside Criminal Case No.3946 of 1993 pending before the Court of Ld. Chief Judicial Magistrate, Rajkot.
(C) pending admission, hearing and final disposal of the present petition, be pleased to stay the further proceedings of Criminal Case No.3946 of 1993 pending in the Court of Ld. Chief Judicial Magistrate, Rajkot.
(D) Any other and further relief/s as may be deemed ift and proper may be granted in the interest of justice.
5. The brief facts of the present case are as under:-
5.1 The complainant - Income-Tax Officer filed a private complaint against the petitioner alleging ineralia that the Page 3 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined accused no.1 had won the lottery prize of Rs.25 lakhs in a draw held on 12.7.1984. The said prize money was paid to the accused no.1 on 18.9.1984 by an account payee cheque by the Director of Lotteries, Government of Gujarat, Gandhinagar, after deducting an amount of Rs.8,43,750/- being tax deducted at source, which was paid to the Government Account on 6.8.1984 as per the certificate u/s.203 of the Act issued by the Authority. That on further scrutiny it was found that the said prize money of Rs.25 Lakhs was falsely shown to have divided equally amongst all the accused persons and all the accused persons have filed their returns of income in the similar fashion falsely declaring in each return the total income of Rs.57,130/-. That on the requests of all the accused persons a provisional assessment u/s.141 A of the Act was passed on 19.3.1986 and the tax of Rs.16,266/- was determined payable in each of the 15 cases from the TDS of Rs.8,43,000/-, a refund of Rs. 5,99,760 being the excess tax deducted at source was issued, after obtaining permission of the IAC, to the accused no. 1 as the TDS certificate u/s. 203 of the Act was in his name.Page 4 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023
NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined 5.2 That since the accused no. 1 had declared 1/15th of the prize money instead of entire prize money a summons u/s.131 of the Act was issued and proceedings were initiated under the Income Tax Act. Ultimately, the assessing officer had rejected the claim of HUF of the accused no.1 and held the correct status to be as "Individual" and entire lottery prize of Rs. 25 lakhs was taxable in the hands of the accused no. 1 alone in his status as "Individual". Assessing officer determined total income of the accused at Rs. 12,59,300/-. 5.3 The appeal against the aforesaid assessment the CIT (A) Rajkot by the appellate order dated 19.10.88 have dismissed the appeal of the accused.
5.4 That the second appeal of the accused no. 1 before the ITAT against the appellate order aforesaid is also dismissed by the order dated 2.5.1990 of the ITAT and further Misc. application of the accused no.1 against the ITAT's order dt. 2.5.1990 is also rejected by the ITAT by its order dt. 19.11.1991.
5.5 That the assessing officer on conclusion of penalty Page 5 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined proceedings have levied penalty of Rs. 7,40,710 /- against the accused no. 1 by the penalty order dt. 30.3.1990 which is confirmed by the appellate vide order dated 26.5.1992 recorded by the CIT (Appeals) Rajkot.
It is further alleged inter alia that the accused willfully failed to produce the required information and documents requisitioned in the notice u/s. 142(1) of the Act dt. 19.6.1987 as aforesaid, have committed the offence punishable u/s. 276D of the Income Tax Act.
5.6 The petitioner submit that he is facing the Criminal Case No.3946 of 1993 since 25 years. The petitioner had applied for waiver of interest and penalty before the Principal Commissioner of Income Tax vide the application dt. 13.11.2018 stating inter alia the details of case as stated herein above; and further stating that he is not having work due to his old age and he is dependent on Swaminarayan Temple organization, his Fix Deposit amounts have already attached by the Department, and immovable property i.e. house was auctioned by the Tax Recovery officer, it is also stated that he is neither having any income nor having any Page 6 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined assets to pay the interest and penalty amount. 5.7 The petitioner has also applied for compounding of prosecution u/s. 276D and 277 of the Act with separate format and with an undertaking to pay the compounding charges on 13.11.2018 before the Chief Commissioner of Income-Tax. Pursuant to which, the petitioner was informed to pay Rs.1,40,258/- as the compounding fees including prosecution establishment charges and litigation expenses calculated annexere A1 comes to Rs.1,40,258/- and submit a written undertaking regarding payment of Rs.1,40,258/- vide letter dated 29.01.2019 with annexure A1. Thereafter, the petitioner submitted his undertaking before the Chief Commissioner of Income-Tax on 04.02.2019. The petitioner has also filed his affidavit dated 12.11.2018 and affidavit of Hariprasad Swami Guru Dharmacharan Swami dated 12.11.2018 (Kothari Swami of Navagadh Swaminarayan Temple) and another affidavit of petitioner dated 01.12.2018, with the application of petitioner for compounding of the offences.
5.8 Thereafter, on 19.3.2019 the petitioner has written a letter to the Chief Commissioner of Income-Tax informing that Page 7 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined he had submitted undertaking on 4.2.2019 and after passing of one and half months, no order is passed in this regard and requested to pass an order and issue a challan in this regard. 5.9 Thereafter, there was no response from the Income- Tax authority, so the petitioner has paid an amount of Rs.1,40,260/- in the account of Income Tax department on 25.3.2019 and computerized receipt is issued against the said payment.
5.10 The petitioner submits that similar type of different 15 complaints (total 19 complaints) are filed by the respondent no.2. At present petitioner and other accused persons are filing two quashing petitions in Criminal Case No.1470 of 1993 and Criminal Case No.1471 of 1993; and petitioner is filing other two quashing petitions in Criminal Case No.3946 of 1993 (present case) and Criminal Case No.3947 of 1993. Details of other 15 cases filed against other persons (relatives of the petitioner) are mentioned as under:-
No. Name of Accused Criminal Case Criminal Misc.
Application 1 Jagdishbhai Tapubhai Ambalia 3919/1993 12409/2019 Page 8 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined 2 Vallabhbhai Ramjibhai Gevariya 3925/1993 12417/2019 HUF & Anr.
3 Vallabhbhai Ramjibhai Gevariya 3926/1993 12423/2019 HUF & Anr.
4 Kishorbhai Tapubhai Ambalia 3929/1993 12418/2019 5 Hansaben Keshubhai Boghra 3931/1993 12433/2019 6 Hansaben Keshubhai Boghra 3932/1993 12432/2019 7 Jayaben Tapubhai Ambalia 3933/1993 12435/2019 8 Jayaben Tapubhai Ambalia 3934/1993 12427/2019 9 Chandubhai Tapubhai Ambalia 3935/1993 12428/2019 10 Jyotiben Muljibhai Lila 3937/1993 12441/2019 11 Jyotiben Muljibhai Lila 3938/1993 12413/2019 12 Vinodrai Keshubhai Boghra 3941/1993 12430/2019 13 Vinodrai Keshubhai Boghra 3942/1993 12419/2019 14 Manjulaben Keshubhai Boghra 3943/1993 12436/2019 15 Jyotiben Tapubhai Ambalia - As 3945/1993 12450/2019 per the site status no such person is there.
16 Jayantibhai Tapubhai Ambalia 3946/1993 8222/2019 17 Jayantibhai Tapubhai Ambalia 3947/1993 12424/2019 18 Jayantibhai Tapubhai Ambalia & 1470/1993 12431/2019 Ors.
19 Jayantibhai Tapubhai Ambalia & 1471/1993 12434/2019 Ors.
5.11 The petitioner submits that the respondent no.2 in the aforesaid complaints, conveniently shown different sections related to similar offences; those complaints are arising out the very same transactions. Therefore, separate complaints are to be treated as one transaction and those complaints may be prosecuted as one complaint. Out of 19 complaints, 04 complaints are dismissed for default, against which revision Page 9 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined applications are preferred by the Income-Tax Department.
5.12 The petitioner has preferred an application for discharge and closure of the criminal case on the ground of pendency of the criminal case for more than 20 years. The trial court is insisting to proceed further in trial, even after the payment of the amount towards the compounding fees. Hence, the petitioner and other persons are here before this court with different petitions.
6. Heard Mr. Tushar Sheth, leraned advocate for the applicants; Mr. Karan Sanghani, learned advocate on behalf of Mr. Kalpana Raval, learned advocate respondent no.2 complainant and Mr. Soaham Joshi, learned APP for the respondent no.1 - State of Gujarat.
7. Mr. Tushar Sheth, learned advocate has raised several contentions. His primary contention is that the complaint which is filed against all the family members by the Income-
Tax Department for the single transaction, that means, lottery ticket purchased by the HUF and the amount is received by HUF and therefore, the profit is divided amongst all the family Page 10 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined members and that amount is shown in the return. He has submitted that there is no case made out against Section- 130D of the I.T.Act or IPC as alleged in the respective complaints. He has further submitted that Criminal Case is pending about 20 years and which itself amounts to breach of fundamental rights and speedy trial conferred under Article 21 of the Constitution. In support of the same, he has referred judgment of Hon'ble Apex Court reported in 2002 (4) SCC 578, para-21 of the said judgment and also another judgment of Hon'ble Apex Court reported in 1992 (1) SCC 225, para 62 to 65 of the said judgment and has submitted that in view of this also, this Court should interfere with the proceedings, which are otherwise, not maintainable in eye of law. He has submitted that the complaint, which is filed by the Income-Tax Department is time barred and instituted after a period of seven years and eight months from the date of filing of the return i.e. on 16.07.1985 and the present complaint is filed on 31.03.1993. He has filed the present complaint after dismissal of Second Appeal of petitioner no.1 on 02.05.1990 as well as dismissal of Misc. Application of petitioner no.1 on 19.11.1991 by the ITAT. He has further submitted that similar type of Page 11 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined different 15 complaints (total 19 complaints) are filed by the respondent no.2. Out of total 19 complaints, 04 complaints are dismissed for default, against which, the revision applications are preferred by the Income-Tax Department. He has further submitted that all the complaints are almost verbatim same regarding same allegations made in the complaint. Therefore, he has submitted that the present petitioner and his relatives will have to undergo agony of trail in 19 cases, out of 04 dismissed for default and atleast 15 applications are pending for similar allegations arising out of same transactions, of- course, by mentioning different sections, which is not permissible in eye of law. In support of his submission, he has relied on judgment of Hon'ble Apex Court in the case of T.T. Antony Vs. State of Kerala reported in 2001 (6) SCC 181 and has submitted that looking to the sameness of allegations, such applications, total in 19 and at present 15 complaints are pending, are not maintainable in eye of law. He has further submitted that the petitioner has applied for compounding prosecution under Section-276D and 277 of IT Act with separate format and with an undertaking to pay the compounding charges on 13.11.2018 before the Chief Page 12 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined Commissioner of Income-Tax. Pursuant to which, petitioner no.1 was informed to pay Rs.1,40,258/- as the compounding fees including prosecution establishment charges and litigation expenses. Thereafter, the petitioner has written to the authority about his readiness to pay amount by filing undertaking, but there is no response and therefore, the petitioner has paid an amount of rs.1,40,260 in the account of Income-Tax Department on 25.03.2019 and receipt is issued against the said payment. Thereafter, the petitioner has applied for waiver of interest and penalty vide application dated 13.11.2018 stating that the details of case as stated herein above and further stating that he is not having work due to his old age and he is dependent on Seaminarayan Temple Organization and therefore, he is not able to pay the amount. But no response is received from the Department and he further submitted that the Income-Tax Department has produced a communication at the time of hearing for perusal of this Court, whereby, the Department has further raised demand of Rs.54,59,191/- towards the amount of tax involved penaty etc., which is not permissible in eye of law. He has also dorawn attention of this Court purusant to the earlier order Page 13 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined passed by this Court. He has already preferred an application dated 08.07.2019 for withdrawal of discharge application before the concerned trial Court, but he is not aware about the development pursuant to such application filed by the petitioner for withdraw of such application. Therefore, he submitted that at the best, only one complaint can be proceeded against all the persons as their transactions are same and therefore, the Income-Tax Department by filing 19 different complaints, out of which 15 are pending. Therefore he prays to exercise jurisdiction under Section-482 of the Cr.P.C. by quashing and setting aside the criminal case.
8. Per contra Mr. Karan Sanghani, learned advocate for the respondent no.2 has strongly objected the said application by stating that this Court cannot interfere at this stage as the complaint is pending since so-many yeas and due to the pendency of this petition, the complaint could not be proceeded since last more than 04 years. He has further submitted that prima-facie the case is made out against each of the petitioners in all the petitions on the ground that they have filed return, where they have filed declaration, which is Page 14 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined found false and misleading. Therefore, as per the provisions of I.T. Act, the offence is made out against all the petitioners and he has referred Section 276 (E), 276(CC) read with Section 153(A) of the Income-Tax Act and also referred to the various sections for which the complaint is filed for IPC and as submitted that in view of this, considering the fact that the other persons have filed Income-Tax Return by showing the share of lottery ticket received by one person with a view to evade the liability to pay tax. Therefore, the trial is required to be proceeded further as the Chief Income-Tax Commissioner at the relevant point of time has informed the petitioner about the compounding process, however, since the petitioner is not ready to pay the amount of penalty and interest with the amount of tax, merely paying the amount of compounding itself is not sufficient to evade the liability to pay tax, which amounts to Rs.54,59,191/-. Therefore, if such huge amount is not recovered, then it will huge loss to the revenue and State Exchequer. This cannot be permitted and if such complaint is quashed by this Court on any ground, then it will wrong message to the wrongdoer by evading of tax, which false and misleading declaration while filing Income-Tax Return. He Page 15 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined has relied on the judgment reported in [2018] 98 taxmann.com 470, para-10 of that judgment. He has also relied on guidelines for compounding of offence under Direct Tax Laws, 2014 superseded by further order dated 14.06.2019.
9. He has relied on judgment reported in [2016] 70 taxmann.com 131 (Gujarat), para 14 and 16 of that judgment and submitted that in view of the provisions of Income-Tax Act, there can be statutory presumption as to 'culpable mental state'. Therefore, prima-facie, the present proceedings are required to be continued in the facts and circumstances of the presence case, merely, delay in the trial is not good ground considering the change of circumstances. He has also submitted that the present case is barred by limitation as the criminal cases are filing in the year 1993 and present petitions are filed after a huge delay of 26 years and that itself on the ground of delay itself the petitions are required to be dismissed. He has further submitted that regarding the offences, which are punishable under various provisions of IPC, in all sections prima-facie case attracted to the provisions Page 16 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined of Sec.197 to 199 of IPC in respective matters as there is a false declaration made by the concerned assessee in the Income-Tax Return and there is also conspiracy between the family members about with a view to avoid liability of Income- Tax pursuant to the amount received from lottery amount. Therefore, only prosecution is permitted to be proceeded further with the complaints, which are filed by the Income-Tax Department. This will say by example for the other members of the society and therefore, under the guise of all, the petitioners should not permitted to raise contentions under Article 21 of the Constitution, which is not available to the petitioners by considering the fact that since 1993 to 2019, he is able to see that the complaint could not be proceeded further, which is filed before the concerned Court and in the year 2019 , he has filed present petition and thereafter, while issuing notice, this Court has granted liberty to the applicants to file appropriate applications for adjournment on account of pendency of present proceedings. Therefore, now it is appropriate time for this Court to consider the case by dismissing this petition with appropriate direction to concerned trial Court to expedite the proceedings. He has Page 17 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined further submitted that in view of the judgment of M/s. Neeharika Infrastructure Pvt. Ltd. Vs. State of Maharashtra reported in 2021 SCC Online Sc 315, this Court should not exercise power under Section-482 of Cr.P.C. as prima-facie case is made out against all the petitioners.
10. Learned APP has also submitted that the contention raised by the Income-Tax Department and the proceedings pursuant to the complaints are required to be continued as prima-facie offence is made out against all the petitioners. He has also prayed not to quash the complaints.
11. I have considered the rival submissions made at the bar. I have also considered the contentions raised by the learned advocate for the petitioners. The main contention of the present petitioner to the fact that continuation of proceedings to the complaint after so-many years, that means, the complaint is filed in the year 1993 and petition is filed till the date the trial could not be proceeded and therefore, in view of the provisions of Article 221 of Constitution, the proceedings of trial required to be concluded by exercising power under Page 18 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined Section-492 of Cr.P.C. He has relied on the judgment in the case of P. Ramachanda Rao Vs. State of Karnataka reported in 2002 (4) SCC 578. The relevant para 21 is reproduced as under:-
21.....In appropriate cases, inherent power of the High Court, under Section 482 can be invoked to make such orders, as may be necessary, to give effect to any order under the Code of Criminal Procedure or to prevent abuse of the process of any Court, or otherwise, to secure the ends of justice. The power is wide and, if judiciously and consciously exercised, can take care of almost all the situations where interference by the High Court becomes necessary on account of delay in proceedings or for any other reason amounting to oppression or harassment in any trial, inquiry or proceedings. In appropriate cases, the High Courts have exercised their jurisdiction under Section 482 of Cr.P.C.
for quashing of first information report and investigation, and terminating criminal proceedings if the case of abuse of process of law was clearly made out. Such power can certainly be exercised on a case being made out of breach of fundamental right conferred by Article 21 of the Constitution. The Constitution Bench in A.R. Antulay's case referred to such power, vesting in the High Court (vide paras 62 and 65 of its judgment) and held that it was clear that even apart from Article 21, the Courts can take care of undue or inordinate delays in criminal matters or proceedings if they remain pending Page 19 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined for too long and putting to an end, by making appropriate orders, to further proceedings when they are found to be oppressive and unwarranted.
12. Another judgment which is relied in the case of Abdul Rehman Antulay Vs. R.s. Nayak reported in 1992 (1) SCC 225, Para-62 to 65 is reproduced as under:-
"62. The provisions must be read with Section 482 of the Code which saves the inherent powers of the High Court. The latter provision recognizes the power of the High Court to pass appropriate orders "to prevent abuse of process of any court or otherwise to secure the ends of justice". In several cases, the High Courts and this Court have directed dropping or discontinuance of proceedings where such proceedings constituted an abuse of process of court or where the ends of justice demanded such a course of action. We may refer to some of these cases now.
63. In Machander v. State of Hyderabad: 1955 CriLJ 1644 , this Court observed that while it is incumbent on the court to see that no guilty person escapes, it is still more its duty to see that justice is not delayed and accused persons are not indefinitely harassed. The scales, the court observed, must be held even between the prosecution and the accused. In the facts of that case, the court refused to order trial on account of the time already spent and other relevant circumstances of Page 20 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined that case.
64. In Veerbhadra v. Ramaswamy Naickar: 1958 CriLJ 1565 , this Court refused to send back proceedings on the ground that already a period of five years has elapsed and it would not be just and proper in the circumstances of the case to continue the proceedings after such a lapse of time. Similarly, in Chajju Ram v. Radhey Sham [1971] S.C.R. 172, the court refused to direct a re-trial after a period of 10 years having regard to the facts and circumstances of the case. In State of U.P. v. Kapil Deo Shukla : 1972CriLJ1214 , though the court found the acquittal of the accused unsustainable, it refused to order a remand or direct a trial after a lapse of 20 years.
65. It is, thus, clear that even apart from Article 21 courts in this country have been cognizant of undue delays in criminal matters and wherever there was inordinate delay or whore the proceedings were pending for too long and any further proceedings were deemed to be oppressive and unwarranted, they were put an end to by making appropriate orders."
13. He has relied on these observations and submitted that the petitioners would have face great hardships and harassment due to pendency of trial and this will cause serious prejudice and it amounts to clear abuse of process of law. This submission is not found appropriate in the facts and Page 21 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined circumstances of the present case as the petitioner has established proceedings since 1993 and thereafter he has approached Income-Tax Authority by making necessary application for compounding prosecution under Section-276D and 277 of the Income-Tax Act, which are reproduced as under:-
276D.2 Failure to produce accounts and documents If a person wilfully fails to produce, or cause to be produced, on or before the date specified in any notice served on him under sub- section (1) of section 142- such accounts and documents as are referred to in the notice 3 or wilfully fails to comply with a direction issued to him under sub- section (2A) of that section], he shall be punishable with rigorous imprisonment for a term which may extend to one year or with fine equal to a sum calculated at a rate which shall not be less than four rupees or more than ten rupees for every day during which the default continues, or with both.]
277. False statement in verification, etc. If a person makes a statement in any verification under this Act or under any rule made thereunder, or delivers an account or statement which is false, and which he either knows or believes to be false, or does not believe to be true, he shall be punishable,-Page 22 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023
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(i) in a case where the amount of tax, which would have been evaded if the statement or account had been accepted as true, exceeds one hundred thousand rupees, with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine;
(ii) in any other case, with rigorous imprisonment for a term which shall not be less than three months but which may extend to three years and with fine.]
14. Therefore, considering the fact that Income-Tax Authority has not responded his request regarding the compounding charges, he has deposited amount in the bank account and thereafter, the present petition is filed. This fact itself suggests that the petitioner has accepted that he is liable for the proceedings initiated by the Income-Tax Department pursuant to the provisions of Income-Tax Act as well as IPC. It also transpires that there is no dispute regarding the fact that the present criminal complaint is filed by the Income-Tax Department pursuant to the fact that the petitioners who are the family members at the relevant point of time has filed the Income-Tax Return bifurcating the amount of lottery, which is received by the one of the Page 23 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined petitioner. Therefore, they tried to distribute the profit, prima- facie, it seems that they are entitled to do. Therefore, the Department has filed application for various proceedings after the proceedings of appeal and second appeal before the I.T.A.T. conclusion. Thereafter, the Department has filed a complaint under the provisions of I.T. Act as well as IPC which are under the respective petitions. Therefore, the contention, which is urged by the petitioner that it amounts to abuse of process of law was ill-founded. On the contrary, the petitioner is trying to prolong the proceedings on that count. The petitioners cannot get the benefit of another contention for his wrong doing. Secondly, multiple complaints are filed by the Department for the same for the offence, which is committed on the one transaction. This argument is also not accepted in the facts and circumstances of the present case as the test of the nonfiling multiple FIRs as sameness of the offence and sameness of the parties and sameness of the transactions and sameness of the events. In the present case, though the amount is received by one of the person, who want the amount of lottery, thereafter, such amount was bifurcated in the accounts of each person and different Income-Tax Return Page 24 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined filed by the other members of family and accordingly, the Income-Tax Returns are filed in respective petitioners name and the declarations are also filed stating that the details shown are true and correct. Thereafter, when the appeal which is filed before the Department and Second Appeal is filed before the department pursuant to the said assessment year is rejected by the department. Thereafter, the complaint is filed against all the accused persons, who have filed the Income-Tax Return and pursuant to that, the offence is made out under the provisions of Income-Tax Act as well as IPC. Therefore, it cannot be said that there is element of sameness is satisfied in the present case in view of the judgment of Hon'ble Apex Court in the case of T.T. Antony Vs. State of Kerala reported in 2001 (6) SCC 181. In the present case, element of sameness is missing. This court is not accepting the contention made at the bar. Another contention raised by the learned advocate for the petitioner is that the ingredients of IPC is not satisfied, that is also, not prima-facie found good as the all the offences are registered against the persons under different sections of the IPC as well as under the different sections of I.T. Act. Considering all the FIRs, it Page 25 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined transpires that the provisions of Sections-177, 193, 196, 199 and 120B as well as Section-34, 109, 114 of IPC are mainly alleged. All the provisions are reproduced as under:-
Section 177. Furnishing false information.- Whoever, being legally bound to furnish information on any subject to any public servant, as such, furnishes, as true, information on the subject which he knows or has reason to believe to be false shall be punished with simple imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both;
Or, if the information which he is legally bound to give respects the commission of an offence, or is required for the purpose of preventing the commission of an offence, or in order to the apprehension of an offender, with imprisonment of either description for a term which may extend to two years, or with fine, or with both. Illustrations (a) A, a landholder, knowing of the commission of a murder within the limits of his estate, wilfully misinforms the Magistrate of the district that the death has occurred by accident in consequence of the bite of a snake. A is guilty of the offence defined in this section.
(b) A, a village watchman, knowing that a considerable body of strangers has passed through his village in order to commit a dacoity in the house of Z, a wealthy merchant residing in a neighbouring place, and being bound under clause 5, section VII, 1Regulation III, 1821, of the Bengal Page 26 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined Code, to give early and punctual information of the above fact to the officer of the nearest police-station, wilfully misinforms the police officer that a body of suspicious characters passed through the village with a view to commit dacoity in a certain distant place in a different direction. Here A is guilty of the offence defined in the latter part of this section.2
[Explanation.--In section 176 and in this section the word "offence" includes any act committed at any place out of 3 [India], which, if committed in 156 [India], would be punishable under any of the following following sections, namely, 302, 304, 382, 392, 393, 394, 395, 396, 397, 398, 399, 402, 435, 436, 449, 450, 457, 458, 459 and 460; and the word offender includes any person who is alleged to have been guilty of any such act.]
193. Punishment for false evidence.--Whoever intentionally gives false evidence in any of a judicial proceeding, or fabricates false 144 evidence for the purpose of being used in any stage of a judicial proceeding, shall be punished with imprisonment of either description for a term which may extend to seven years, and shall also be liable to fine; and whoever intentionally gives or fabricates false evidence in any other case, shall be punished with imprisonment of either description for a term which may extend to three years, and shall also be liable to fine.
196. Using evidence known to be false.--Whoever corruptly uses or attempts to use as true or genuine evidence any evidence which he knows to be false or fabricated, shall be punished in the same manner as if he Page 27 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined gave or fabricated false evidence.
199. False statement made in declaration which is by law receivable as evidence.--Whoever, in any declaration made or subscribed by him, which declaration any Court of Justice, or any public servant or other person, is bound or authorized by law to receive as evidence of any fact, makes any statement which is false, and which he either knows or believes to be false or does not believe to be true, touching any point material to the object for which the declaration is made or used, shall be punished in the same manner as if he gave false evidence.
109. Punishment of abetment if the act abetted is committed in consequence and where no express provision is made for its punishment.--Whoever abets any offence shall, if the act abetted is committed in consequence of the abetment, and no express provision is made by this Code for the punishment of such abetment, be punished with the punishment provided for the offence. Explanation.-An act or offence is said to be committed in consequence of abetment, when it is committed in consequence of the instigation, or in pursuance of the conspiracy, or with the aid which constitutes the abetment.
114. Abettor present when offence is committed.-- Whenever any person who if absent would be liable to be punished as an abettor, is present when the act or offence for which he would be punishable in consequence of the Page 28 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined abetment is committed, he shall be deemed to have committed such act or offence.
120B. Punishment of criminal conspiracy.--(1) Whoever is a party to a criminal conspiracy to commit an offence punishable with death, 2*[imprisonment for life] or rigorous imprisonment for a term of two years or upwards, shall, where no express provision is made in this Code for the punishment of such a conspiracy, be punished in the same manner as if he had abetted such offence. (2) Whoever is a party to a criminal conspiracy other than a criminal conspiracy to commit an offence punishable as aforesaid shall be punished with imprisonment of either description for a term not exceeding six months, or with fine or with both.]
34. Acts done by several persons in futherance of common intention.--When a criminal act is done by several persons in furtherance of the common intention of all, each of such persons is liable for that act in the same manner as if it were done by him alone.
15. It also transpires that the proceedings are filed under the provisions of Section-276(C), 276(C1), 277 and 278 of the I.T. Act, which are as under:-
276C. Wilful attempt to evade tax, etc. - (1) If a person wilfully attempts in any manner whatsoever to evade any tax, penalty or interest chargeable or imposable, or under reports his income, under this Act, he shall, without Page 29 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined prejudice to any penalty that may be imposable on him under any other provision of this Act, be punishable,--
(i) in a case where the amount sought to be evaded or tax on under-reported income exceeds twenty-five hundred thousand rupees, with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine;
(ii) in any other case, with rigorous imprisonment for a term which shall not be less than three months but which may extend to two years and with fine.
(2) If a person wilfully attempts in any manner whatsoever to evade the payment of any tax, penalty or interest under this Act, he shall, without prejudice to any penalty that may be imposable on him under any other provision of this Act, be punishable with rigorous imprisonment for a term which shall not be less than three months but which may extend to two years and shall, in the discretion of the court, also be liable to fine.
Explanation.--For the purposes of this section, a wilful attempt to evade any tax, penalty or interest chargeable or imposable under this Act or the payment thereof shall include a case where any person--
(i) has in his possession or control any books of account or other documents (being books of account or other documents relevant to any proceeding under this Act) containing a false entry or statement; or
(ii) makes or causes to be made any false entry or statement in such books of account or other documents; or
(iii) wilfully omits or causes to be omitted any relevant Page 30 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined entry or statement in such books of account or other documents; or
(iv) causes any other circumstance to exist which will have the effect of enabling such person to evade any tax, penalty or interest chargeable or imposable under this Act or the payment thereof.
277. False statement in verification, etc.-- If a person makes a statement in any verification under this Act or under any rule made thereunder, or delivers an account or statement which is false, and which he either knows or believes to be false, or does not believe to be true, he shall be punishable,--
(i) in a case where the amount of tax, which would have been evaded if the statement or account had been accepted as true, exceeds twenty-five hundred thousand rupees, with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine;
(ii) in any other case, with rigorous imprisonment for a term which shall not be less than three months but which may extend to two years and with fine.
278. Abetment of false return, etc.-- If a person abets or induces in any manner another person to make and deliver an account or a statement or declaration relating to any income or any fringe benefits chargeable to tax which is false and which he either knows to be false or does not believe to be true or to commit an offence under sub- Page 31 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023
NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined section (1) of section 276C, he shall be punishable,--
(i) in a case where the amount of tax, penalty or interest which would have been evaded, if the declaration, account or statement had been accepted as true, or which is wilfully attempted to be evaded, exceeds twenty-five hundred thousand rupees, with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine;
(ii) in any other case, with rigorous imprisonment for a term which shall not be less than three months but which may extend to two years and with fine.
16. Considering all these provisions and considering the tenure of the complaints in each matter, it cannot be said that prima-facie case is not made out. Looking to the tenure of the complaints, the criminal case is required to be decided during the course of trial and therefore, I am satisfied that the prima- facie, the ingredients of the secitions are attracted as alleged in view of the averments in the respective complaints and this contention is also not helpful to the present petitions.
17. On the contrary, the judgment which is cited at the bar by the other-side are very helpful to the case of the Income- Tax Department. If we look into the judgment reported in Page 32 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined [2016] 70 taxmann.com 131 (Gujarat), more particularly, paras-14 and 15 are reproduced as under:-
14. The Apex Court in case of Prakash Nath Khanna & Ors. [Supra] held that the expression "in due time"
occurring in Section 276CC means within the time stipulated in Section 139[1] and not the time postulated in Section 139 [4]. The Apex Court further held that filing of the return under section 139 [4], even though without any notice from the Assessing Officer to do so does not satisfy the requirement of section 139 [1] and attracts Section 276-CC. Thus, in view of clear provisions of Section 276 attempt to reach a different conclusion by placing reliance on marginal heading or explanatory memo laid before the Parliament at the time of introduction of that section is impermissible. With respect to quashing criminal proceedings under Article 226 of the Constitution of India, the Apex Court held and observed that if the accused challenges the prosecution on the grounds that [a] there was no concealment of income and the allegation of tax evasion was based on no evidence, [b] the delay in filing returns happened in unavoidable circumstances and without any guilty mind, the absence of culpable mental state could be pleaded in defence at the criminal trial and the factual allegations raised by the writ petitioner-accused could then be considered by the trial Court.
15. Apt it would be, to reproduce the relevant findings given in para 21 to 23 of the said decision, which read Page 33 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined thus-
"21. The term of imprisonment is higher when the amount of tax which would have been evaded but for the discovery of the failure to furnish the return exceeds one hundred thousand rupees. If the plea of the appellants is accepted it would mean that in a given case where there is infraction and where a return has not been furnished in terms of subsection (1) of Section 139 or even in response to a notice issued in terms of sub-section (2), the consequences flowing from non-furnishing of return would get obliterated. At the relevant point of time Section 139(4)(a) permitted filing of return where return has not been filed within subsection (1) and subsection (2). The time limit was provided in clause (b). Section 276-CC refers to "due time" in relation to sub-sections (1) and (2) of Section 139 and not to sub-section (4). Had the Legislature intended to cover subsection (4) also, use of expression "Section 139"alone would have sufficed. It cannot be said that Legislature 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. Subsection (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 Page 34 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined it beyond its legitimate purpose.
22. Whether there was willful failure to furnish the return is a matter which is to be adjudicated factually by the Court which deals with the prosecution case. Section 278-
E is relevant for this purpose and the same reads as follows:
278E. Presumption as to culpable mental state. (1) In any prosecution for any offence under this Act which requires a culpable mental state on the part of the accused, the court shall presume the existence of such mental state but it shall be a defence for the accused to prove the fact that he had no such mental state with respect to the act charged as an offence in that prosecution.
Explanation.--In this sub-section, "culpable mental state" includes intention, motive or knowledge of a fact or belief in, or reason to believe, a fact.
(2) For the purposes of this section, a fact is said to be proved only when the court believes it to exist beyond reasonable doubt and not merely when its existence is established by a preponderance of probability.
23. 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 defence in respect to the act Page 35 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined charged as an offence in the prosecution. Therefore, the factual aspects highlighted by the appellants were rightly not dealt with by the High Court. This is a matter for trial. It is certainly open to the appellants to plead absence of culpable mental state when the matter is taken up for trial."
18. From the bare reading of all these observations, this Court has specifically observed that there is a statutory presumption prescribed in Section-278-E of the Act. This Court has to presume the existence of culpable mental state, and absence of such mental state can be pleaded by all accused as a defence in respect to the act charged as an offence in the prosecution. Therefore, the factual aspects highlighted by the appellants were rightly not dealt with by the this Court. This is a matter for trial. Therefore, I am completely agree with the judgment, which is cited at the bar by the learned advocate for the respondent. Moreover, considering the fact that at the time of filing of petition, the petitioner has filed discharge application. He has not proceeded with the discharge application and simultaneously, he has filed this petition and as such there is no absolute bar under Section-482 of Cr.P.C. whether the discharge Page 36 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined application is filed while issuing notice, the present petitioner has withdrawn the discharge application. However, till the hearing of this petition, though the petitioner has produced a copy of discharge application on the record, but could not produced any order passed pursuant to the discharge application. Therefore, on this count also, the petition is not required to be considered in detail on merits. However, this Court has discussed various contentions raised at the bar even otherwise on this count, the Court can refuse to exercise inherent power under Section-482 of Cr.P.C. more particularly, when the discharge application is pending in the facts and circumstances of the present case. It is also required to be noted that merely showing the readiness to compound the offences by accepting the communication received from the Chief Income-Tax Commissioner and thereafter, by filing undertaking to the effect that the petitioners are ready to compound offeces and thereafter, as the Department has not responded by depositing of compounded fees to the tune of Rs.1,40,258/- in the bank account itself is not sufficient. In view of this fact, this Court cannot exercise its power under Section-482 of Cr.P.C. as now the department is not ready to Page 37 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined compound the offences. It is also required to be noted at this stage that Mr. Sanghani, learned advocate has drawn attention of this Court that even as per the provision of law, the petitioners are required to pay huge amount of Rs.54,59,191/- towards penalty. Therefore, it cannot be said that the Income-Tax Department has acted unfair, on the contrary, the Department is trying to recover the huge amount, if the proceedings pursuant to the recovery is not proceeded then the department may have loss of that amount also, though the present proceedings is not merely for the recovery of that amount, but such amount is outstanding from the present petitioners. Therefore, this Court has to consider from this angle about loss of revenue to the State.
19. Considering the totality of facts and circumstances and also considering the submissions made at the bar, prima-facie, the ingredients of all the sections in respective complaints pursuant to the Income-Tax Act and/or IPC are satisfied in respective complaints and therefore, considering the fact that the delay in failing present petition, the petition is required to be dismissed on this ground also as the complaint is filed in Page 38 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined the year 1993 and petition is filed after a period of seven years from the date of filing of the return. Therefore, the present petition is nothing but to protect the proceedings before the trial Court pursuant to the complaint filed by the Department and therefore, the petition is required to be dismissed on this ground also.
20. Considering the judgment of Hon'ble Supreme Court in case of M/s Neeharika Infrastructure Private Limited v. State of Maharashtra, 2021 SCC OnLine SC 315, more particularly, pra-80 of that judgment, the Apex Court has laid down certain parameters while considering the application under Section- 482 of Cr.P.C.
21. Considering the above observations, this Court is of the opinion that present petition is filed nothing but to delay the proceedings, which is initiated by the Income-Tax Department for the offence as stipulated in the complaints. Considering the totality of the facts and circumstances of the case, this Court do not exercise its power under Section-482 of Cr.P.C. Let the petitioners may face the trial of each case pursuant to Page 39 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023 NEUTRAL CITATION R/CR.MA/8222/2019 JUDGMENT DATED: 20/07/2023 undefined the complaints filed by the respondent no.2 by raising all defence available with them. Learned trial Court shall consider the same in accordance with law.
22. Resultantly, all these Criminal Misc. Applications fail and are hereby therefore dismissed.
It is appropriate to direct the learned trial Court to take up the hearing of all the complaints, which are filed in the year 1993 on the priority basis, after giving proper opportunity of hearing to the parties. Learned trial court also directed to dispose of such proceedings as early as possible preferably within 08 months from today i.e. on or before 31 st March, 2024. It is expected that the parties shall co-operate with the hearing of the proceedings before trial court.
Rule is discharged. Interim relief, if any, granted earlier shall stand vacated forthwith.
(SANDEEP N. BHATT,J) A. B. VAGHELA Page 40 of 40 Downloaded on : Sat Sep 16 22:23:51 IST 2023