2020 (3) TMI 349 - HC - Income Tax

Court Suspends Trial Under Section 276 CC; Rejects Review Application for Compounding

The court directed the trial proceedings under Section 276 CC of the I.T. Act, 1961 to be kept in abeyance until the hearing of the petition on ... Trial of offence u/s 276 CC against the petitioner in abeyance during pendency of the writ petition - application for compounding - HELD THAT:- The conviction of the petitioner was set aside by the learned ASJ on 03.12.2018. Even before that, on 23.10.2018 the petitioner moved an application to seek review of the rejection of earlier application for compounding. The respondents have rejected the said review application by the impugned order dated 29.01.2020 on the ground that the petitioner has not been acquitted and merely his conviction has been set aside on a technical ground. Petitioner has pointed out that the limitation for filing the application for compounding has since been done away with vide circular No.25/2019 dated 09.09.2019. He further submits that the respondents have adopted a wrong yardstick for rejection of the review application by stating that the petitioner has not been acquitted. He submits that if the petitioner were to be acquitted, there would be no question of his seeking compounding. As on date it cannot be said that the petitioner stands convicted since his conviction has been set aside by the learned ASJ. The matter has been remanded back for leading of further evidence. We direct that the learned ACMM, dealing with the petitioner’s prosecution shall adjourn the proceedings to a date after the hearing of this petition. Issues:1. Application for direction to keep trial in abeyance during pendency of writ petition.2. Rejection of review application for compounding.3. Interpretation of circular No.25/2019 regarding limitation for filing compounding application.4. Direction to adjourn proceedings until hearing of the petition.Analysis:1. The petitioner sought a direction to keep the trial of an offence under Section 276 CC of the I.T. Act, 1961 against him in abeyance during the pendency of the writ petition. The petitioner had previously moved an application for compounding, which was rejected due to being filed after the stipulated time. However, the petitioner's conviction was set aside, and a review application was filed. The respondents rejected the review application on the grounds that the petitioner had not been acquitted but merely had his conviction set aside on a technical ground. The petitioner argued that the limitation for filing the compounding application had been removed by circular No.25/2019 dated 09.09.2019. The court directed the learned ACMM to adjourn the proceedings until the hearing of the petition on 04.05.2020.2. The rejection of the review application for compounding was based on the contention that the petitioner had not been acquitted but only had his conviction set aside. The petitioner argued that if he were to be acquitted, there would be no need for seeking compounding. The court considered that as of the present date, the petitioner cannot be considered convicted since his conviction was set aside by the learned ASJ. The matter was remanded for the leading of further evidence, and the court directed the proceedings to be adjourned until the hearing of the petition.3. The interpretation of circular No.25/2019 regarding the limitation for filing the compounding application was crucial in this case. The petitioner argued that the limitation had been removed by the circular, and the respondents' rejection of the review application based on the petitioner not being acquitted was incorrect. The court considered this argument and directed the learned ACMM to adjourn the proceedings until the hearing of the petition on 04.05.2020.4. In conclusion, the court allowed the exemption and directed the learned ACMM to keep the trial proceedings in abeyance until the hearing of the petition. The issues regarding the rejection of the review application for compounding and the interpretation of the circular regarding the limitation for filing the application were thoroughly discussed and considered in the judgment. The court's decision to adjourn the proceedings showcased a fair consideration of the petitioner's arguments and the legal aspects involved in the case.