Case Law Details
While hearing an appeal filed by Dabur India Ltd Promoter Pradip Burman in Black Money case related to undisclosed Bank Account maintained Outside India, Delhi High Court held that prosecution can be launched against him as at the time of commission of alleged offence, the petitioner Pradip Burman has not reached to the age of 70 years, although, the complaint in question was filed against him when he attained the age of 70 years. Pradip Burman cannot be given benefit of Instruction No.5051/1991 dated 07.02.1991. High Court further held that pendency of appeal is no ground for stay of the proceedings if the same has no bearing on the complaint.
Related Facts are as follows :-
Mr. Ganesh, learned senior counsel appearing on behalf of the petitioner argued that the complaint case filed by the respondent/Income Tax Department is liable to be quashed on the ground that at the time of filing of the criminal complaint, the petitioner had attained the age of 70 years, thus, no prosecution can be initiated against him.
In support of the aforenoted submission, learned senior counsel has heavily relied upon the case bearing Criminal Revision Petition No.36/2011, titled as ‘Arun Kumar Bhatia & Anr Vs. Vijay Kumar & Ors.’, decided by this Court on 02.11.2011. In the said case, the petitioner had taken the ground that he was above the age of 70 years on the date of filing the complaint and as per Circular dated 07.02.1991 issued by the Central Board of Direct Taxes, no prosecution can be initiated against a person who is above the age of 70 years.
Learned senior counsel further argued that case against the petitioner is that he concealed his income and did not file income tax accordingly. The said complaint was filed on the allegation that the petitioner had filed his original return of income in the prescribed form duly signed and verified by him for Assessment Year (‘AY’) 2007-08 on 31.07.2007 vide receipt No.000105, declaring income of Rs.75,31,769/-, in which his account with HSBC (P) Bank, Zurich, was not disclosed by him. The information that petitioner is having foreign bank account with the aforesaid Bank was received by the Investigation Wing of the Income Tax Department, Government of India. On coming to know about the said information with the Indian Government, vide letter dated 30.08.2011 addressed to the Director General of Investigation, Income Tax Department, New Delhi, the petitioner stated that he had an account outside India, which is as per FEMA Regulations, through his AR Abhay K. Aggarwal. To verify the details of the said foreign bank account in the name of the petitioner and the source of the deposits, summon under Section 131 (1A) of the Income Tax Act, 1961 (‘IT Act’) dated 02.09.2011 was issued to the petitioner. Having knowledge qua start of the inquiries with regard to the source of funds deposited by the petitioner in the aforesaid foreign bank account, the petitioner admitted the same vide letter dated 03.10.2011, wherein he firstly stated that the information with the Department is unauthentic/unreliable and then agreed to deposit income tax on account of the balance exists in the foreign bank account in his name. Copy of the same is annexed as Annexure-I to the complaint filed by the petitioner. Vide letter dated 07.10.2011, the petitioner again offered to deposit income tax on the undisclosed deposits made by him in the foreign bank account, copy of the letter is annexed as Annexure-J.
The petitioner vide letter dated 14.10.2011 admitted that the amount lying in the foreign bank were about US$40,000 and US$32,12,000 in the Financial Year (‘FY’) 2005-06 and 2006-07, relevant to AY 2006-07 and 2007-08. Copy of the same is annexed as Annexure-K.
Learned senior counsel further submitted that since the petitioner has challenged the AO in the appeal and the same is pending for adjudication, therefore, the petitioner cannot be prosecuted in the criminal complaint filed by the Department.
To strengthen his submissions, learned senior counsel has relied upon the case of Commissioner of Income Tax, Mumbai, Vs. Bhupen Champal Lal Dalal & Anr., in SLP (Crl.) No.2430 of 2000 decided on 27.02.2001 by the Supreme Court, wherein observed as under:-
” The prosecution in criminal law and proceedings arising under the Act are undoubtedly independent proceedings and, therefore, there is no impediment in law for the criminal proceedings to proceed even during the pendency of the proceedings under the Act. However, a wholesome rule will have to be adopted in matters of this nature where courts have taken the view that when the conclusions arrived at by the appellate authorities have a relevance and bearing upon the conclusions to be reached in the case necessarily one authority will have to await the outcome of the other authority.
xxxx xxxx xxxx In the present case, there is no claim of quashing of the proceedings. When ultimately the result to come out of the proceedings before the appellate authorities have a definite bearing on the cases alleged against the respondents, we find that the High Court is justified in granting the interim order it did and we do not think that such an interim order calls for interference at our hands. The learned counsel on either side relied on several decisions, but in the view we have taken it is unnecessary to refer to those decisions.”
On the other hand, Mr. Rahul Chaudhary, learned senior standing counsel appearing on behalf of the respondent Department submitted that the petitioner has not approached this Court with clean hands and has tried to mislead this Court by stating that Instruction No.5051/1991 dated 07.02.1991 mandates that no prosecution could be initiated against a person who is above the age of 70 years, conveniently leaving out the expression ‘at the time of commission of offence’. He submitted that the said instruction does not mandate that no prosecution can be initiated against a person who has attained the age of 70 years, however, specifies as under:-
“4. Prosecution need not normally be initiated against persons who have attained the age of 70 years at the time of commission of offence.”
Thus, the words “need not normally” used in para 4 of the instructions clearly show that the instructions do not provide for absolute bar on initiation of prosecution against persons who have attained the age of 70 (at the time of commission of offence). Further submitted, the instructions are in the nature of broad guidelines which should be kept in mind while initiating proceedings and provide for greater stress in initiation of prosecution proceedings in case of offences involving tax frauds, fabrication of evidence and major defaults.
Learned counsel further submitted that admittedly, date of birth of the petitioner is 02.11.1942. As on 28.07.2006 and 31.07.2007, i.e., the date of filing of original income tax return for the AY 2006-07 and 2007-08 respectively, which are the dates of commission of offence under Section 276 C (wilful attempt to evade tax etc.) and 277 (false statement in verification etc.) of the Act, the petitioner had attained the age of 63 years and 64 years respectively. Therefore, reliance placed on Instruction No.5051/1991, dated 07.02.1991 is misplaced as it is not applicable to the facts of the present case for the reason the petitioner had not attained the age of 70 years at the time of commission of offence as provided.
Learned counsel submitted that in reply to the application filed by the petitioner, the Department stated that at the time of filing of Complaint No.70/04, the petitioner had not filed any appeal in respect of the AO, subject matter of said complaint, however, the same had been filed as an afterthought with a view to thwart the criminal proceedings pending against him. It was further stated that even the appeal has been filed only to a limited extent of addition in respect of the said complaint qua the exchange rate of foreign currency. Even pendency of appeal is no ground for stay of the proceedings if the same has no bearing on the complaint.
It is pertinent to mention here that the aforesaid petition of Arun Kumar Bhatia and Anr. (supra) was allowed on the statement made by learned senior standing counsel for the Income Tax Department, who fairly conceded that as per Circular dated 07.02.1991, no prosecution can be initiated against a person who is above the age of 70 years.
Since the aforesaid order dated 02.11.2011 was passed by this Court only, therefore, it can authoritatively be said that the said order was not passed on merits, however, based on the precise statement made by the learned counsel for the Department. The fact remains that Instruction No.5051/1991 dated 07.02.1991 states as under:-
“4. Prosecution need not normally be initiated against persons who have attained the age of 70 years at the time of commission of offence.”
Admittedly, at the time of commission of alleged offence, the petitioner was not reached to the age of 70 years, however, the complaint in question was filed against him when he attained the age of 70 years. Thus, in my considered opinion, since case of Arun Bhatia (supra) was decided on the basis of the Circular dated 07.02.1991 and not on merits, therefore, benefit of the same cannot be given to the present petitioner.
