TaxTMI 
TaxTMI 
2007 (8) TMI 200
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.... to 5836/1990. Factual Matrix : 3. Applicant No.1 was a partnership firm carrying on business as Civil Contractors, whereas applicant No.2 (since deceased) and applicant No.3 were the partners thereof. The applicants have contended that during the previous years relevant to the assessment years 1984-85 and 1985-86, applicant No.1 made interest payments to various parties who were its creditors. Such interest payments to some of the parties were more than Rs.1,000/- in aggregate, in a single previous year. The applicant No.1 failed to deduct tax at source (TDS) while making such payments which exceeded Rs.1,000/- in aggregate. 4. The respondent No.1 launched prosecution against the applicants, on 28^th February, 1990, before the Add....
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....lly heard on 27th April, 2007 and rejected by the impugned order dated 5th May, 2007. Submissions : 8. Mr.Sathe, learned senior counsel for the applicants submits that the amendment to section 276B of the Income Tax Act with effect from 1^st April, 1989 amounted to "omission" and not "repeal". He submits that section 6 of the General Clauses Act is applicable to repeal and not to omission. 9. Mr. Sathe pointed out that the present prosecution was launched on 28^th February, 1990 when failure to deduct tax was no longer an offence, in other words, it was not an offence at the time when the prosecution was launched. He submits that since the change in section 276B of the Income Tax Act amounts to an omission, all actions under the om....
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....months but which may extend to three years and with fine. Section 276B (from September 10, 1986 but prior to April 1, 1989) Failure to deduct or pay tax.^___ If a person, fails to deduct or after deducting, fails to pay the tax as required by or under the provisions of sub-section (9) of section 80E or Chapter XVII-B, he shall be punishable,- (i) in a case where the amount of tax which he has failed to deduct or pay exceeds one hundred thousand rupees, with rigorous imprisonment for a term which shall not be less than six months but which may extend to seven years and with fine" (ii) in any other case, with rigorous imprisonment for a term which shall not be less than three months but which may extend to three years and with fin....
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....ints which were filed prior to the omission could not be proceeded with since section 6 of the General Clauses Act applied only to repeal and not to omission. 15. In Salwan Constructions Co. v. Union of India, (2000) 245 ITR 175 (Del), it was observed by the Delhi High Court that "Repeal" connotes the abrogation of one Act by another, whereas "amendment" of a statute means an alteration in law leaving some part of the original still standing. Section 276B has been amended so as not to treat failure to deduct as a serious offence. Also there is no savings clause to initiate proceedings under the old section, after it has been amended/omitted. Hence complaints filed after the amendment to section 276B are not maintainable. 16. Kaushal K....