Case Law Details
A.M. Enterprises and Another Vs State of Jharkhand and Another (Jharkhand High Court)
Introduction: The Jharkhand High Court recently passed a landmark judgment in the case of A.M. Enterprises and Another Vs State of Jharkhand and Another, quashing criminal proceedings against the petitioner related to failure to deposit TDS (Tax Deducted at Source). The case provides a crucial interpretation of Section 276B read with Section 278B of the Income Tax Act, 1961.
Context of the Petition: The petition aimed to quash the entire criminal proceeding, including the order dated 02.05.2018, for Economic Offence Complaint Case No.17 of 2018. The case originated from allegations that the petitioner failed to deposit TDS amounting to Rs. 2,02,117 for the financial year 2015-16.
The Petitioner’s Arguments: The petitioner’s counsel contended that the firm was not aware of the TDS provisions for the last quarter of the financial year 2015-16. When they realized their mistake, they immediately deposited the TDS along with interest. The petitioner also emphasized that they had not been heard before the sanction order for prosecution was passed.
The Respondent’s Standpoint: The Income Tax Department argued that the petitioner’s act of depositing the TDS and interest did not affect the prosecution case. They insisted that since the petitioner failed to fulfill the statutory provisions initially, the case was rightly lodged.
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