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This revision petition has been preferred against the judgment in C.A.No.182 of 1997 on the file of the Principle Sessions Judge, Chennai, which had arisen out of the judgment rendered by the learned Additional Chief Metropolitan Magistrate, Chennai, in E.O.C.C.No.207 of 1986.

2. The short facts of the complaint is that the revision petitioner/accused, a cinema actress, had obtained a loan of Rs.4,65,000/- from the All India Anna D.M.K party, Chennai, as per the entry made in the above said party's ledger folio on 17.4.1986. The accused had admitted in her sworn statement given before the Assistant Director of inspection (investigation) on 23.4.1986 about the above said borrowal of Rs.4,65,000/- from the above said political party. According to the prosecution as per section 269SS of Income Tax Act 1961, a person can obtain any loan or deposit only through an account payee cheque or an account payee bank draft if the amount of loan exceeds Rs.10,000/-. Since the loan obtained by the accused which is above Rs.10,000/- was not by way of account payee cheque or account payee bank draft, according to the prosecution, there is a violation of Section 269SS of the Income Tax Act, 1961, by the accused which is liable to be punished under Section 276DD r/w 269SS of the Income Tax Act.

7. The learned counsel Mr.A.K.Mylsamy appearing for the revision petitioner has not touched the merits of the case, but entire arguments of the learned counsel for the revision petitioner would revolve around the subsequent amendment in the Income Tax Act in respect of Section 276DD which is the penal section for violation of the provision of Section 269SS of the Income Tax Act, 1961. Section 276DD of the Income Tax Act, 1961 was omitted by Direct Tax Laws (Amendment) Act, 1987 which came into force with effect from 1.4.1989. Relying on the ratio of the Honourbale Apex Court in AIR 2002 SC 3126 (M/s.General Finance Co. and anther Vs. Assistant Commission of Income Tax), the learned counsel for the revision petitioner would contend that after the omission of Section 276DD from the Income Tax Act, 1961 by Direct Tax Laws (Amendment) Act, 1987, a prosecution cannot be launched or continued for the violation of the provisions under Section 269SS of the Income Tax Act. The short facts of the above cited case are that:

"The appellants viz. General Finance Company and another had received deposits from one Amar Singh, Gurdev Singh and Hardev Singh on different dates in the year 1985 and the said fact was disclosed in the income tax returns filed by them for the assessment year 1986-87. The Income Tax department initiated prosecution against the appellants for an offence under Section 269SS of the Income Tax Act, 1961, which provides that no person shall take or accept any other person any loan or deposit otherwise than by the account payee cheque or account payee bank draft which exceeds Rs.10,000/- (now Rs.20,000/-). Section 276DD is the penal section for the violation of the provision under Section 269SS of the Income Tax Act (herein after referred as the "Act"). Section 276DD has been omitted from the Act by the Direct Tax Laws (Amendment) Act, 1987, with effect from 1.4.1989. A complaint was filed under Section 276DD of the Act before the Chief Judicial Magistrate, Sangrur, on 31.3.1989. A petition under Section 482 of the Cr.P.C., and article 227 of the Constitution was filed for a direction to quash the proceedings for prosecution under Section 276DD of the Act. The High Court took a view that at the time of initiation of the prosecution by the department the provision was in force ie., during the accounting year 1986-87 and that the said provision under Section 276DD of the Act was omitted from the statute book only from 1.4.1989 and accordingly dismissed the writ petition.

8. The learned counsel appearing for the revision petitioner relying on the above observation would content that the initiation of proceedings under Section 269SS of the Act against the revision petitioner itself is not maintainable after the omission of Section 276DD of the Act as per the Direct Tax Laws (Amendment) Act with effect from 1.4.1989. The learned counsel would attract the attention of this Court to the penal section provided under Section 271D of the Act which was also incorporated into the statute book by Direct Tax Laws (Amendment) Act, 1987 with effect from 1.4.1989 i.e., on the same day on which section 276DD of the Act was directed to be omitted by the Direct Tax Laws (Amendment) Act, 1987. Section 271D of the Act gives enormous powers to the Commissioner (Joint) of the Income Tax to levy penalty against any person who contravenes the provisions of Section 269SS of the Act. After the induction of the above said provision of law, the Commissioner of Income Tax is empowered to levy penalty on a person who violates the provision of Section 269SS of the Act. Relying on the above said provision of law ie., Section 271D of the Act, the learned counsel for the revision petitioner would contend that the judgment of the Courts below are liable to be set aside and matter may be remanded to the Commissioner of the Income Tax, who had initiated the proceedings before the Court of law against the accused.