Case Law Details
Sudhan Chandra Basak Vs Union of India (Allahabad High Court)
This application is filed on basis of some undisputed facts that orders of penalty were passed against applicant under Sections 271(1)(a), 271(1)(c) and 273(b) of Income Tax Act for late filing of return for Assessment Year 1983-84. These orders were challenged by way of three separate appeals and Appellate Authority vide separate orders dated 19.06.1989 cancelled the penalty and allowed all appeals. However, the criminal proceedings under Section 276-C of Income Tax Act initiated simultaneously remained in existence.
Supreme Court in K.C. Builders and anothers vs. Assistant Commissioner of Income Tax (2004) 2 SCC 731 where in similar circumstances Court has held as under:
“24. In the instant case, the penalties levied under Section 271(1)(c) were cancelled by the respondent by giving effect to the order of the Income Tax Appellate Tribunal in I.T.A. Nos. 3129-3132. It is settled law that levy of penalties and prosecution under Section 276C are simultaneous. Hence, once the penalties are cancelled on the ground that there is no concealment, the quashing of prosecution under Section 276C is automatic.
25.In our opinion, the appellants cannot be made to suffer and face the rigorous of criminal trial when the same cannot be sustained in the eyes of law because the entire prosecution in view of a conclusive finding of the Income Tax Tribunal that there is no concealment of income becomes devoid of jurisdiction and under Section 254 of the Act, a finding of the Appellate Tribunal supersedes the order of the Assessing Officer under Section 143(3) more so when the Assessing Officer cancelled the penalty levied.”
Please become a Premium member. If you are already a Premium member, login here to access the full content.
