ITO vs. Firoz Abdul Gafar Nadiadwala (ACMM)
t is well established that accused committed alleged offence. Before authority, he also remain absent. Not any application for compounding the offence is filed. It appears that there is culpable mental state of the accused for non depositing of TDS amount within time therefore, he is liable for punishment. The offence U/sec. 276B of Income Tax Act 1961 is punishable with rigorous imprisonment which shall not be less than three months and which may extend to 7 years and with fine. The matter is on record not substantiate the contention of accused that due to financial crunches fund problems, accountants negligence, accused not aware about payment of depositing tax constrains resulted in not depositing TDS amount. However, there is no allegation that accused is irregular in paying the tax other than the case in hand. Thus, the Court is of the considered view that accused is liable for possible sentence of 3 months rigorous imprisonment and fine. It is the minimum punishment. The Court is not having discretion in reducing the sentence. Therefore, accused shall undergo rigorous imprisonment for a period of 3 months and fine of Rs.5,000/ (Rs. Five Thousand only) for having committed offence U/sec. 276B of IncomeTax Act.
FULL TEXT OF THE ORDER OF cOURT OF ADDL. CHIEF METROPOLITAN MAGISTRATE , MUMBAI IS AS FOLLOWS:-
1. The complainant Ajay Kamble, Income Tax Officer(TDS)1(5) had filed the complaint u/s. 200 of the Cr.P.C. against the accused for committing the offence punishable u/s. 276B of Income Tax Act, 1961 pertaining to financial year 2009-2010 and assessment year 2010-2011.
2. Brief facts of the complainant’s case are as under –
The complainant is the Income Tax Officer (TDS)1(5), Mumbai, attached to CIT(TDS), Mumbai. The sanctioning authority in exercise of powers conferred u/s. 279(1) of Income Tax Act has accorded sanction to prosecute the accused u/s. 276B of Income Tax Act. Accused is an assessee in the jurisdiction of the complainant for the income tax (TDS purpose). The accused is an individual having his office at plot No.20, Barkat, Gulmohor Cross Road, No.5, Juhu Scheme, Andheri(W), Mumbai. The accused during various dates from the period 01/04/2009 to 31/03/2010 and was under obligation u/s.194A of the Act to deduct the income tax from interest paid/credited under section 194C of the act to deduct the income tax from the payment of contractors, u/s.194H of the Act to deduct the income tax from the payments of commissions and u/s.194J of the Act to deduct the income tax from the payment of fees for professional or technical services. The accused was under further obligation u/s. 200 and 204 of the Act r/w Rule 30 of the Income Tax Rules, 1962 to pay or to deposit income tax so deducted to the credit of Central Government within the prescribed period. During the period from 01/04/2009 to 31/03/2010 accused had deducted tax of Rs. 8,56,102/- u/s. 194A, 194C, 194H and 194J of the Income Tax Act but failed to pay or to deposit income tax so deducted to the credit of Central Government. The accused failed to show reasonable cause or excuse to pay deducted tax within the prescribed period to the credit of Central Government within the prescribed period. The said amount was paid after a long period of delay beyond 12 months. Therefore, the accused has committed default u/s. 200 and 204 of the Act, 1961 r/w Rule 30 of the Income Tax Rules, 1962.
3. The complainant further submitted that in view of default committed by the accused show cause notice was issued to the accused, the accused required to show cause as to why prosecution should not be launched against him for offence u/s. 276B of the Income Tax Act for failure to pay the amount deducted by way of income tax within stipulated time. The complainant submitted that the explanation given by the accused for his failure to pay the said tax deducted at source within prescribed time does not constitute reasonable cause for the said default. The accused has committed a default u/s. 200 and 204 of the Income Tax Act 1961 r/w Rule 30 of the Income Tax Rules, 1962 by failing without reasonable cause or excuse to pay the income tax so deducted to the credit of Central Government and said default amounts to an offence punishable u/s. 276B of the Income Tax Act. Therefore, by granting sanction u/s. 279(1) of the Income Tax Act, prosecution launched against the accused as accused has failed to comply with the statutory provisions without reasonable cause. Hence accused has committed an offence punishable under section 276B of Act. Hence, present complaint.
4. After filing of the complaint, cognizance was taken and case was registered against the accused for offence punishable u/s. 276B of the Income Tax Act. The process was issued u/s. 276B of the Income Tax Act. Notice was served on the accused, in response to the notice, accused appeared through his Counsel and enlarged on bail.
5. The complainant complied the formalities u/s. 207 of Cr. P.C. All the documents were furnished to the accused. Thereafter evidence of the complainant and sanctioning authority was recorded before charge and after hearing both the sides my Predecessor hold that there is sufficient material to frame the charge and accordingly charge was framed against the accused as per Ex.17 u/s. 276B of the Income Tax Act. Contents of the charge were read over to the accused in vernacular. Accused pleaded not guilty and claimed for trial. The plea of the accused is at Ex.18.
6. In order to prove the charges leveled against the accused, the complainant has examined two witnesses. These are C.W.1 Vinod Kumar Pande, sanctioning authority at Ex.10 and C.W.2 Ajay Ghanshyam Kamble, complainant at Ex.19 and placed number of documents on record. After closer of evidence of the complainant, statement of accused u/s. 313 of Cr. P.C. was recorded at Ex.23. The accused denied incriminating evidence put to him. Defence of accused is of total denial. The accused submitted that TDS amount is already deposited with the Government and he is regular payee of the tax and false case filed against him.
7. From the contents of the complaint and evidence of both the sides, after hearing Ld. Advocate for complainant and accused at length, following points arise for my determination and I have recorded my findings against each point with reasons as follows -
