Fraudulent tax evasion requires proof of intent to defraud; mere non-payment after notice is insufficient.

Fraudulent evasion of tax under section 45(2)(b) of the Madras General Sales Tax Act, 1959 requires proof of deception and an intent to defraud, not merely prolonged non-payment after notice and time to pay. The meaning of "fraudulently" is read in its ordinary sense and by reference to section 25 of the Indian Penal Code, 1860. Where there is no evidence of concealment, dissipation of assets, or other circumstances showing a deliberate attempt to defeat recovery, fraudulent intent cannot be inferred from arrears alone. A genuine dispute over the validity of the assessment also negatives an inference of fraud.

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Issues: Whether failure to pay sales tax, despite notice and time for payment, by itself established fraudulent evasion under section 45(2)(b) of the Madras General Sales Tax Act, 1959.

Analysis: The provision required more than mere non-payment or delay. Fraudulently evading payment imported an element of deception and intent to defraud, to be proved by the prosecution. The meaning of "fraudulently" was taken in the ordinary sense and by reference to section 25 of the Indian Penal Code, 1860. The absence of evidence showing concealment, dissipation of assets, or other circumstances pointing to a deliberate intent to defeat recovery meant that fraudulent evasion could not be inferred merely because the tax remained unpaid for a long time. The fact that the assessee disputed the validity of the assessment also negatived the inference that non-payment was fraudulent.

Conclusion: The prosecution failed to establish the offence under section 45(2)(b) against the assessee.

Final Conclusion: The convictions and sentences were set aside and the revisions were allowed in favour of the assessee.

Ratio Decidendi: For an offence of fraudulent evasion of tax, the prosecution must prove an intent to defraud and surrounding circumstances from which such intent can reasonably be inferred; mere non-payment of tax, even after notice and lapse of time, is not enough.

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