SKS MC Joint Venture Vs State of Jharkhand (Jharkhand High Court)
Jharkhand High Court has quashed criminal proceedings initiated under the Income Tax Act, 1961, against SKS MC Joint Venture and its partner for the delayed deposit of Tax Deducted at Source (TDS). The court’s decision, delivered under Section 528 of the Bharatiya Nagarik Suraksha Sanhita, 2023, emphasized that once the principal TDS amount along with applicable interest has been paid, continuing prosecution for a compoundable offence amounts to an abuse of the legal process, especially when the complaint is filed significantly after the payment.
The case revolved around a TDS amount of Rs. 21,72,670/- that the petitioner No. 1, SKS MC Joint Venture (a partnership firm), through its partner, petitioner No. 2, failed to deposit to the Central Government’s credit by the due date of April 30, 2014. While the deposit was indeed delayed, the petitioners subsequently paid the full deducted TDS amount along with interest on September 17, 2014. Despite this payment, an Economic Offence Case (No. 14 of 2018) was instituted on April 13, 2018, leading to the Special Judge, Economic Offences, Ranchi, taking cognizance of offences punishable under Section 276B (failure to pay tax to the credit of Central Government) read with Section 278B (offences by companies) of the Income Tax Act, 1961, on August 10, 2022.
