Karnataka High Court
The Income Tax Department vs M/S Elixir Enterprises And Hotels Pvt ... on 8 December, 2025
-1-
NC: 2025:KHC:51631
CRL.A No. 1807 of 2023
HC-KAR
IN THE HIGH COURT OF KARNATAKA AT BENGALURU
DATED THIS THE 8TH DAY OF DECEMBER, 2025
BEFORE
THE HON'BLE MR. JUSTICE G BASAVARAJA
CRIMINAL APPEAL NO. 1807 OF 2023 (A)
BETWEEN:
THE INCOME TAX DEPARTMENT
BY ITS INCOME TAX OFFICER (TDS),
WARD -1(2), NO.59, HMT BHAVAN,
BELLARY ROAD, GANGANAGAR,
BENGALURU-560 032.
...APPELLANT
(BY SRI. THIRUMALESH M.,ADVOCATE)
AND:
1. M/S ELIXIR ENTERPRISES AND
HOTELS PVT LTD.,
135, RESIDENCY ROAD,
BENGALURU-560 025
(REPRESENTED BY ITS MANAGING DIRECTOR).
2. SRI.K.V. KUPPARAJU
Digitally signed MANAGING DIRECTOR,
by SUMA B N
Location: HIGH M/S ELIXIR ENTERPRISES AND
COURT OF HOTELS PVT. LTD., 135,
KARNATAKA
RESIDENCY ROAD,
BENGALURU-560 025.
...RESPONDENTS
(BY SRI. ANNAMALAI S.,ADVOCATE FOR R1 AND R2)
THIS CRL.A IS FILED U/S 378(4) CR.PC PRAYING TO 1.
SET ASIDE THE JUDGMENT OF ACQUITTAL OF RESPONDENTS
VIDE ITS JUDGMENT. 2. CONVICT THE RESPONDENTS FOR THE
OFFENCE P/U/S 276B OF INCOME TAX ACT.
-2-
NC: 2025:KHC:51631
CRL.A No. 1807 of 2023
HC-KAR
THIS APPEAL, COMING ON FOR ADMISSION, THIS DAY,
JUDGMENT WAS DELIVERED THEREIN AS UNDER:
CORAM: HON'BLE MR. JUSTICE G BASAVARAJA
ORAL JUDGMENT
The Income Tax Department has preferred this appeal against the judgment of acquittal passed by the Presiding Officer, Special Court for Economic Offences, Bengaluru in C.C.No.288/2019, dated 29.03.2023.
2. Brief facts leading to this appeal are that, the complaint filed by the complainant against the accused Nos.1 and 2 for the offence under Section 276B read with Section 278B of Income Tax Act, 1961. It is alleged in the complaint that accused No.1 is the company registered under Companies Act, 2013. Accused No.2 is the Managing Director of accused No.1-Company, who is responsible for day-to-day conduct of business of accused No.1-Company. Therefore by issuing notice under Section 2(35) of Income Tax Act, 1961, he is treated as a Principal Officer of accused No.1-Company. It is the case of the complainant that accused No.1-Company had deducted TDS during the financial year 2013-14 on various -3- NC: 2025:KHC:51631 CRL.A No. 1807 of 2023 HC-KAR heads under Section 192, 194C, 194H, 194I and 194J of Income Tax Act, 1961 to an extent of Rs.43,24,203/-. However, the accused have not remitted the same to the Central Government well within time. As per Rule 30 of the Income Tax Rules read with Section 200 of Income Tax Act, accused No.2 being the Managing Director, though had knowledge about non-remittance, has failed to remit the same.
3. It is further alleged that the Commissioner of Income Tax (TDS) issued show cause notice dated 10.02.2017 and 20.11.2017 to the accused informing about the offence. The said notice was duly served. The accused, vide correspondence dated 02.12.2017 replied to the said show cause notice stating that due to severe financial crisis, there was delay in remittance of TDS. Therefore, the accused has admitted the default of non-remittance of TDS. Hence, complaint was filed.
4. After taking cognizance, case was registered in C.C.No.288/2019 and summons was issued. In response to summons, accused appeared before the trial Court and enlarged on bail. Substance of plea was recorded. Accused pleaded not guilty and claimed to be tried. -4-
NC: 2025:KHC:51631 CRL.A No. 1807 of 2023 HC-KAR
5. To bring home the guilt of the accused, the complainant has been examined as PW1 and 12 documents were marked as Ex.P1 to Ex.12. On closure of complainant's evidence, statement under Section 313 of Cr.P.C was recorded. Accused has denied the evidence of PW1 and adduced the evidence of accused No.2 as DW1 and 7 documents were marked as Ex.D1 to Ex.D8.
6. Having heard the arguments on both sides, the trial Court acquitted the accused for the offence under Section 276B r/w 278B of the Income Tax Act, 1961.
7. The learned counsel for the appellant would submit that the trial Court ought to have followed the decisions relied by the appellant. The trial Court ought to have seen that decisions relied upon by the trial Court are not applicable to the facts of the case and same are distinguishable. The trial Court erred in holding that complainant has not produced reliable materials to prove belated payments without appreciating the materials produced by the appellant to prove the same. The trial Court erred in not considering the evidence and materials -5- NC: 2025:KHC:51631 CRL.A No. 1807 of 2023 HC-KAR produced by the appellant and has not given sufficient reasons for acquitting the accused for the alleged commission of offences. The respondents/accused have not produced the sufficient materials to prove financial crisis and delay was not explained properly. The trial Court has not assigned proper, valid reasons for acquitting the accused.
8. Learned counsel for the respondents has filed written synopsis.
9. I have examined the materials placed before this court. On perusal of the impugned judgment, the trial Court in paragraphs 12 to 26 of its judgment has discussed in length and considered all the contentions taken by the complainant. After proper appreciation of materials on record, the trial Court has rightly held that the complainant has failed to prove the guilt beyond all reasonable doubt.
10. Considering the facts and circumstances of the case, I do not find any factual or legal error in the impugned judgment passed by the trial Court. The Hon'ble Supreme Court in the case of CONSTABLE 907 SURENDRA SINGH AND -6- NC: 2025:KHC:51631 CRL.A No. 1807 of 2023 HC-KAR ANOTHER v. STATE OF UTTARAKHAND reported in (2025)5 SCC 433; and in the case of BABU SAHEBGOUDA RUDRAGOUDAR AND OTHERS v. STATE OF KARNATAKA reported in (2024)8 SCC 149; in the case of CHANDRAPPA v. STATE OF KARNATAKA reported in (2007)4 SCC 415; and in the case of H.D. SUNDARA v. STATE OF KARNATAKA reported in (2023)9 SCC 581 has summarized the principles governing exercise of appellate jurisdiction while dealing with an appeal against judgment of acquittal under section 378 of Code of Criminal Procedure. It is held that, the acquittal of the accused further strengthens the presumption of innocence; the appellate court, while hearing an appeal against acquittal, is entitled to re- appreciate the oral and documentary evidence; the appellate court, while deciding an appeal against acquittal, after re- appreciating the evidence, is required to consider whether the view taken by the trial court is a possible view which could have been taken on the basis of the evidence on record; if the view taken is a possible view, the appellate court cannot overturn the order of acquittal on the ground that another view was also possible; and the appellate court can interfere with the order of acquittal only if it comes to a finding that the only -7- NC: 2025:KHC:51631 CRL.A No. 1807 of 2023 HC-KAR conclusion which can be recorded on the basis of the evidence on record was that the guilt of the accused was proved beyond a reasonable doubt and no other conclusion was possible. The interference by an appellate court for reversing the judgment of acquittal recorded by the trial court in favour of the accused has to be exercised only if the judgment of acquittal suffers from patent perversity; the same is based on a misreading/omission to consider material evidence on record; and that no two reasonable views are possible and only the view consistent with the guilt of the accused is possible from the evidence available on record. Keeping in the mind the aforementioned decisions, I proceed to pass the following:
ORDER Appeal being devoid of merits, dismissed at the stage of admission.
All pending if any, IAs stand disposed of.
Sd/-
(G BASAVARAJA) JUDGE RL, List No.: 1 Sl No.: 29