Case Law Details
R. P. Darrmalingam Vs ACIT (Supreme Court of India)
In the case of R. P. Darrmalingam vs. ACIT, the Supreme Court of India quashed criminal proceedings initiated under Section 276CC of the Income Tax Act, 1961. The proceedings stemmed from the appellant’s delayed filing of a revised income tax return, which was attributed to the seizure of records. The penalty proceedings under the IT Act were subsequently dropped, and a refund was ordered in the appellant’s favor, raising questions about the necessity of continuing the criminal case.
The Court found that pursuing criminal charges was unwarranted, given the circumstances and the precedent set in the case of Guru Nanak Enterprises vs. ITO (2005). Emphasizing the resolution of penalty proceedings in favor of the appellant, the Supreme Court set aside the impugned order and quashed the criminal case. The decision reflects a balanced approach to tax law enforcement, where procedural delays arising from extraordinary circumstances do not justify prolonged legal action.
FULL TEXT OF THE SUPREME COURT JUDGMENT/ORDER
1. Leave granted.
2. The appeal lies on a very narrow compass. The criminal proceedings have been initiated under Section 276CC of the Income Tax Act, 1961 (hereinafter referred to as ‘the IT Act, 1961’) against the appellant for non-filing of the revised income tax return within time.
3. Learned senior counsel appearing for the appellant submitted that the revised income tax return was filed belatedly as the concerned records were seized in pursuance to the seizure. Ultimately, the penalty proceedings under the IT Act, 1961 were dropped, and in fact refund has been ordered.
4. Learned counsel appearing for the respondent submitted that in view of the non-compliance of the mandate in not filing the revised income tax return within time, the criminal proceedings have been initiated against the appellant.
5. We are of the view that continuing the criminal proceedings would be unnecessary. We are dealing with a case where the appellant did in fact file the revised income tax return, and penalty proceedings which were initiated against the appellant itself have been dropped. As a consequence, refund was also ordered.
6. We are further supported by the reasoning given in the decision of this Court in ‘Guru Nanak Enterprises and Ors Vs. ITO, reported in (2005) 10 SCC 451.
7. Thus, considering the facts of the case in its totality, we are inclined to set aside the impugned order.
8. Accordingly, the impugned order stands set aside. Consequently, the criminal proceedings initiated under Section 276CC of the IT Act, 1961 against the appellant stands quashed.
9. The appeal is allowed accordingly.
10. Pending application(s), if any, shall stand disposed of.
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