B. Mohammad Iqbal Vs ACIT (Madras High Court)
The Madras High Court quashed prosecution proceedings initiated under Section 276CC of the Income Tax Act, 1961 for alleged wilful failure to file income tax return for Assessment Year 2014-15. The complaint had been filed before the Additional Chief Metropolitan Magistrate (Economic Offences), Chennai, alleging that the petitioner failed to file return despite sale of immovable property for Rs.75 lakhs during the relevant financial year.
The petitioner contended that the Assistant Commissioner of Income Tax who filed the complaint had no jurisdiction over his case, as jurisdiction vested with the Income Tax Officer, Non-Corporate Ward 17(1), Chennai. It was argued that no transfer order under Section 127 of the Act had been passed authorising the respondent to proceed. The petitioner also submitted that after receiving the show cause notice issued by the Income Tax Officer, he filed the return and paid tax along with interest. He further argued that no penalty proceedings under Section 271(f) had been initiated and therefore prosecution under Section 276CC was unsustainable.
The department argued that subsequent filing of return or payment of tax would not erase the offence of non-filing of return within the prescribed time. It was also contended that prosecution could be initiated with prior sanction of the Principal Commissioner and need not necessarily be filed by the jurisdictional Assessing Officer.
