Dinar Tarcar Resources (India) Pvt Ltd. Vs Income Tax Department (Bombay High Court)
The Bombay High Court considered a writ petition challenging the order dated 7 November 2025 by the Chief Judicial Magistrate (CJM), Merces, issuing process against the petitioners in a complaint filed under Section 276C(2) of the Income-tax Act, 1961, alleging a wilful attempt to evade payment of tax for Assessment Year 2012-13. The petition also challenged the complaint itself.
The petitioners contended that the order issuing process had been passed mechanically despite a Nil Dues Certificate and an order under Section 154 showing that the entire tax liability, along with penalty and interest, had been discharged. They submitted that the income and tax liability disclosed in the return had been accepted during assessment, there had been no concealment, and the complaint failed to disclose any wilful attempt to evade payment of tax. They further argued that substantial tax had been paid even before prosecution was sanctioned, the balance was subsequently cleared, and continuation of criminal proceedings amounted to abuse of process.
The Income Tax Department opposed the petition, submitting that the mining ban relied upon by the petitioners was irrelevant to the tax liability for the relevant assessment year. It argued that the petitioners had wilfully attempted to evade payment of admitted tax, penalty and interest, and that subsequent payment of dues or issuance of a Nil Dues Certificate did not extinguish the offence already committed. The Department also contended that there was no requirement to place subsequent rectification orders or post-complaint developments before the Magistrate at the stage of cognizance.
