ITO Vs Ichibaan Automobiles Pvt Ltd (ACMM)
Conclusion: Deposit of TDS deducted to the credit of the Central Government with delay of 12 months without having reasonable cause was punishable with rigorous imprisonment of 3 months and fine of Rs.5,000/ (Rs. Five Thousand only) each for having committed offence..
Held: The complainant submitted that accused No.01 was a private limited company and accused No.02 was the principal officer of accused No.01 under obligation u/sec. 192 to deduct the Income Tax from salary paid/credited. During the period from 01.04.2010 to 31.03.2011 on various dates they deducted tax of Rs. 7,52,076/- but failed to pay or deposit the Income Tax so deducted to the credit of the Central Government within the prescribed period. He further submitted that accused No.02 being Principal Officer of accused No.01 were also liable for the same. A show cause notice was issued to all the accused but they did not respond. The complainant submitted that accused had committed a default u/sec. 200 and 204 of The IncomeTax Act r/w rule 30 of Income Tax Act, 1962 by failing without reasonable cause or excuse to pay the Income Tax so deducted to the credit of the Central Government. Hence, he filed present complaint against the accused for the offence punishable u/sec. 278B r/w sec. 278B. It was held no doubt, accused paid the tax with interest and penalty, but tax was paid after stipulated period. The accused preferred the application for compounding the offence before concern authority where as per act the powers of compounding was only given to Commissioner of Income Tax, but it was seen that no such compounding order had passed. The accused had deposited the TDS amount at belated stage. The offence U/sec. 276B r/w 278B of Income-Tax Act 1961 was punishable with rigorous imprisonment which should not be less than three months which might extend to 7 years and with fine. However, there was no allegation that accused was irregular in paying the tax other than the case in hand. Thus, the Court held that accused were liable for possible sentence of 3 months rigorous imprisonement and fine of Rs.5,000/ (Rs. Five Thousand only) each for having committed offence U/sec. 276B r/w sec. 278B.
FULL TEXT OF THE HIGH COURT ORDER /JUDGEMENT
1. The complainant Pramoda Natraj, Income Tax Officer (TDS)1(2)(4) had filed the complaint u/s. 200 of the Cr.P.C. against the accused for committing the offence punishable u/s. 276B of Income Tax Act, 1961 pertaining to financial year 2009-2010 and Assessment year 2010-2011.
2. Brief facts of the complainant’s case are as under –
The complainant submitted that accused No.01 is a private limited company and accused No.02 is the principal officer of accused No.01 under obligation u/sec. 192 of IncomeTax Act to deduct the IncomeTax from salary paid/credited. During the period from 01.04.2010 to 31.03.2011 on various dates they deducted tax of Rs. 7,52,076/- but failed to pay or deposit the IncomeTax so deducted to the credit of the Central Government within the prescribed period. He further submitted that accused No.02 being Principal Officer of accused No.01 are also liable for the same.He further submits that after deduction of said amount, instead of depositing such TDS amount to the Government Account within respective dates accused failed, without reasonable cause or excuse, to pay within the prescribe period. He further submits that said amount was paid after a long period of delay beyond 12 months.
3. A show cause notice was issued to all the accused but they did not respond. The complainant submits that accused have committed a default u/sec. 200 and 204 of The Income Tax Act r/w rule 30 of The Income Tax Act, 1962 by failing without reasonable cause or excuse to pay the Income Tax so deducted to the credit of the Central Government. Hence, he filed present complaint against the accused for the offence punishable u/sec. 278B r/w sec. 278B of The Income Tax Act, 1961.
4. After filing of the complaint, cognizance was taken and case was registered against the accused for offence punishable under Section 276B r/w sec. 278B of The Income Tax Act. The process was issued u/s. 276B r/w sec. 278B of The Income Tax Act.
5. The complainant complied the formalities u/s. 207 of Cr. P.C. All the documents were furnished to the accused. Thereafter evidence of the complainant and sanctioning authority was recorded before charge and thereafter, after hearing both the sides my Predecessor hold that there is sufficient material to frame the charge and accordingly charge was framed against the accused as per Ex.38 under Section 276B r/w sec. 278B of The Income Tax. Contents of the charge were read over to the accused in vernacular. Accused pleaded not guilty and claimed for trial. The plea of the accused is at Ex.39 and 40.
6. In order to prove the charges leveled against the accused, the complainant has examined two witnesses. These are C.W.1 Vinod Kumar Pande sanctioning authority at Ex.19 and C.W.2 Pramoda Natraj complainant at Ex.24A and placed number of documents on record. After closer of evidence of the complainant, statement of accused u/s. 313 of Cr. P.C. was recorded at Ex.42 and 43. The accused denied incriminating evidence put to him. The accused submitted that
TDS amount is not deposited within time due to crunches in company. TDS amount not paid within time is not willful/deliberately. He has already filed compounding application to Commissioner of Income Tax and it is under consideration hence prayed that prosecution keep in abeyance till the disposal of the compounding application.
The following points arise for my determination and I have recorded my findings against each point with reasons as follows
