1992 (3) TMI 2

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....nd the offences is the short question for our consideration. M. P. Tiwari and M. L. Passi are the respondents before us in these appeals. M. P. Tiwari is the secretary and principal officer of Messrs. Hans Raj Gupta and Co. P. Ltd. He, along with other directors of the said company was prosecuted under section 276B of the Act on the charge that he committed defaults in depositing the income-tax deducted from the salaries of the employees of the company during the assessment years 1979-80 to 1982-83. M. L. Passi was the managing director of Messrs. Inspi Auto Industry P. Ltd. He was also prosecuted under section 276B of the Act for committing defaults in depositing the tax deducted at source by the company. Both Tiwari and Passi applie....

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....ll be done if the assessee belongs to monopoly or large industrial house or is a director of a company belonging to or controlled by such house. 2. Cases in which the prospects of a successful prosecution are good should not ordinarily be compounded. 3. Compounding will not be done in cases of second and subsequent offences. C. Cases which may be compounded: 1. Except in cases falling within categories (1) and (3) of B above, compounding of an offence can be done with the consent of the Board if the amount involved in the offence/default is less than rupees one lakh. 2. Except in cases falling under categories (1) and (3) of B above, and category (1) of C, compounding may be done with the approval of the Minister if, in view ....

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....compound an offence ...... No assurance of any kind should be given to the assessee before obtaining Board's approval.' This was not the intention of the Legislature when section 279 of the Act was incorporated." These appeals by way of special leave are by the Revenue against the judgments of the High Court. This court in Navnitlal C Javeri v. K K Sen, AAC [1965] 56 ITR 198 ; [1965] 1 SCR 909, Ellerman Lines Ltd. v. CIT [1971] 82 ITR 913 [1972] 4 SCC 474 and in K P. Varghese v. ITO [1981] 131 ITR 597 ; [1981] 4 SCC 173, has held that circulars issued by the Central Board of Direct Taxes under section 119(1) of the Act are binding on all officers and persons employed in the execution of the Act even if they deviate from the provisi....