2021 (4) TMI 1264 - HC - Income Tax

Petition Disposed with Directions for Special Judge to Decide Application under Income Tax Act

The petition was disposed of with directions for the learned Special Judge, CBI-01 to decide the application under Section 226(4) of the Income Tax Act, ... Application under Section 226 (4) - Direct Tax Vivad Se Vishwas Act - urgency of the prayers made by the petitioners for consideration of the application under Section 226 (4) of the Income Tax Act, 1961 filed by the respondent no.2 submitting to the effect that the petitioners seek to avail of the Direct Tax Vivad Se Vishwas Act, 2020 - HELD THAT:- As considered appropriate to direct the learned Special Judge, CBI-01 seized of the proceedings in relation to RC No.06(A)/2006 (bearing new No.CC/R82/2019) to dispose of the application filed by the Income Tax Authority dated 23.08.2021, under Section 226 (4) of the Income Tax Act, 1961 by the date 26.04.2021. A submission has been made on behalf of the CBI with reference to the aspect of the TCR in the matter having been requisitioned by this Court in an appeal preferred by the CBI assailing the orders dated 18.04.2015 and 23.09.2016 of the learned Special Judge, CBI-01 and it was thus submitted on behalf of the petitioners that the directions to the learned Special Judge, CBI-01 to dispose of the prayer under Section 226 (4) of the Income Tax Act, 1961 as moved by the Income Tax Authority would be made difficult in view of the pendency of the TCR before this Court, qua which, it is essential to observe that it is always open to the petitioners to seek redressal before this Court for the TCR to be placed before the learned Special Judge, CBI01 for disposal of the application under Section 226 (4) of the Income Tax Act, 1961, in relation to which, the prayer can always be made before the concerned Bench of this Court. Issues Involved:1. Status report and closure report filed by CBI.2. Application under Section 226(4) of the Income Tax Act, 1961.3. Orders by the learned Special Judge, CBI regarding the closure report.4. Compliance and further investigation by CBI.5. Directions for the learned Special Judge, CBI to decide the application under Section 226(4) of the Income Tax Act, 1961.Issue-wise Detailed Analysis:1. Status Report and Closure Report Filed by CBI:In terms of the proceedings dated 08.04.2021, a status report was filed by the CBI in a sealed cover along with the closure report previously filed before the learned trial Court. The status report was directed to be placed on record, while the closure report was to remain in a sealed cover as per the proceedings dated 08.04.2021.2. Application under Section 226(4) of the Income Tax Act, 1961:The petitioners sought directions for the learned Special Judge, CBI to decide the application under Section 226(4) of the Income Tax Act, 1961, filed by Respondent No.2 forthwith. The application dated 23.08.2012, filed by the Income Tax Department, was pending before the learned trial Court. The learned Special Judge, CBI-01 had previously observed that the application should be decided only after the decision on the closure report by the CBI.3. Orders by the Learned Special Judge, CBI Regarding the Closure Report:The learned Special Judge, CBI-01 had renotified the matter for passing orders on the closure report to the date 18.04.2015, stating that the claim of the Income Tax Department was dependent on the fate of the closure report. The final report under Section 173 of the Cr.PC, 1973 was filed but not accepted by the learned Special Judge, CBI-01, who directed the CBI to conduct further investigation and file a fresh final report.4. Compliance and Further Investigation by CBI:The proceedings dated 23.09.2016 indicated that the CBI had filed an incomplete charge sheet and had not complied with the order dated 18.04.2015. The court observed that the CBI officials had deliberately not investigated the matter properly to save senior officers and politicians. The court directed the Director, CBI, to supervise the further investigations and assigned the task to an officer not below the rank of a Joint Director, CBI, to be concluded within three months.5. Directions for the Learned Special Judge, CBI to Decide the Application under Section 226(4) of the Income Tax Act, 1961:Despite opposition from the CBI, the court directed the learned Special Judge, CBI-01 to dispose of the application filed by the Income Tax Authority dated 23.08.2021, under Section 226(4) of the Income Tax Act, 1961, by the date 26.04.2021. The petitioners sought to avail of the Direct Tax Vivad Se Vishwas Act, 2020, requiring them to deposit income tax arrears by 30.04.2021. The court noted that it was always open to the petitioners to seek redressal for the TCR to be placed before the learned Special Judge, CBI-01 for disposal of the application under Section 226(4) of the Income Tax Act, 1961.Conclusion:The petition was disposed of with directions for the learned Special Judge, CBI-01 to decide the application under Section 226(4) of the Income Tax Act, 1961, by 26.04.2021, allowing the petitioners to seek necessary redressal for the TCR to be placed before the learned Special Judge, CBI-01.