Revised return and tax payment defeat wilful concealment allegations in income-tax prosecution

A prosecution under sections 276C and 277 of the Income-tax Act could not be sustained where the assessee filed a revised return within the time allowed by section 139(5), disclosed the omitted income, and paid the tax with interest. On those undisputed facts, the omission was not shown to be deliberate concealment with intent to evade tax, so the foundation of wilful concealment was absent and the complaint was quashed.

---

---

Issues: Whether prosecution for offences under sections 276C and 277 of the Income-tax Act, 1961 was liable to be quashed where the assessee filed a revised return within the permitted time under section 139(5) after omission of income from the original return and paid the tax with interest.

Analysis: The omitted income was subsequently disclosed, the tax and interest on that amount were paid, and the revised return was filed within the time allowed by section 139(5). In these undisputed circumstances, the omission could not be treated as deliberate concealment with an intention to evade tax. The foundation of the complaint, namely wilful concealment, was therefore not made out on the facts presented.

Conclusion: The prosecution was not legally tenable and was quashed in favour of the petitioner.

Ratio Decidendi: Where an assessee files a revised return within the statutory period under section 139(5) and pays the tax and interest on the omitted income, a prosecution alleging deliberate concealment and tax evasion cannot be sustained absent material showing wilful concealment.

---