Criminal prosecution after tax penalty recovery may be quashed as abuse of process on the same transaction

Criminal prosecution for cheating was treated as unsustainable where the same transaction had already been dealt with under the Punjab Value Added Tax Act, the penalty and tax had been recovered, and the goods and vehicle had been released. On those facts, continuation of the FIR and related proceedings was held to serve no useful purpose and to amount to abuse of process of law, so the criminal case was quashed.

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Issues: Whether criminal proceedings and the FIR for cheating could be sustained after the petitioner had already been proceeded against under the Punjab Value Added Tax Act, 2005, penalty and tax had been recovered, and the goods and vehicle had been released.

Analysis: The petitioner had been subjected to proceedings under Section 51(7)(c) of the Punjab Value Added Tax Act, 2005 and Section 51(12) of the same Act. The competent authority imposed penalty and tax, which were deposited by the petitioner, and the goods were thereafter released. In these circumstances, the continuation of criminal proceedings on the same transaction was held to serve no useful purpose and to amount to abuse of process of law.

Conclusion: The FIR and all subsequent criminal proceedings were quashed in favour of the petitioner.

Ratio Decidendi: Where the revenue authority has already adjudicated the transaction, recovered the penalty and tax, and released the goods and vehicle, continuation of criminal prosecution on the same facts may be quashed as an abuse of process of law.

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