TaxTMI 
TaxTMI 
2002 (11) TMI 85
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....ishable under sections 276C, 277/278B of the Income-tax Act, 1961 (for short, "the Act") and sentencing applicant No. 1 to fine of Rs. 200 and applicants Nos. 2 to 4 to rigorous imprisonment for three months each with fine of Rs. 200 on each count. The case of the prosecution as unfolded before the trial court was that applicant No. 1, through applicant No. 2, Mohanlal, had submitted a return of income for the assessment year 1981-82, on September 20, 1983, showing taxable income of Rs. 47,000. During the search by the Sales Tax Department, in the premises of the applicants, some loose papers Udarat Bahi, etc., were found and the same were seized. The entries available in loose papers were not mentioned in the account books. As per the a....
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.... in the cases of Union of India v. Govindji Laxmidas and Co. [1992] 20 ITC 56 (MP); ITO v. Sovasaria Motor Parts and Accessories Ltd. [1995] 216 ITR 524 (Gauhati); Prem Kumar Keshri v. State of Bihar [1998] 230 ITR 252 (Patna) and ITO v. Mohinder Pal Ajay Kumar [1993] 203 ITR 866 (P&H). Learned counsel also put forth that all the applicants/partners of the firm could not be held responsible for the alleged offence. The only person who was the in charge of and responsible to the firm for the conduct of his business besides the firm is liable. For this proposition, he cited the cases of Sat Pal v. State of Punjab [1993] 200 ITR 139 (P&H) and Jaswant Rai Mittal and Co. v. ITO [1992] 196 ITR 414 (P&H). In contra, learned counsel for the NAs ....
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....ts own legs. (iii) Where there are two sets of evidence available on record or two views are possible the evidence in favour of the accused or the views in favour of the accused have to be relied upon. In the present case, the Income-tax Officer, Mr. Kulkami (PW-1), in paras. 6 and 7 has deposed that after examination of the note book and loose papers, he came to the conclusion that the correct account was not maintained and produced by the applicants and they had suppressed actual transaction of their income. He made an assessment on the basis of all loose papers and note books (Udarat Vahi), etc., but as stated above, all these documents have not been filed in court. In the assessment order exhibit P/3-C (internal page 8), the total....
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....e ingredients is on them. The practice and procedure before the learned magistrate in such a case would, without doubt, be governed by the Criminal Procedure Code and the Evidence Act. Under these circumstances, the applicant-Department will have to place material on record from which it could be inferred that the non-applicants have consciously and deliberately indulged in the concealment of income. The decision of the Supreme Court in CIT v. Khoday Eswarsa and Sons [1972] 83 ITR 369, would indicate that the mere fact the explanation of the assessee was disbelieved and the amount included in the assessment would not, by itself, be enough to impose penalty. The circumstances of the case must be such as to lead to the reasonable and positive....
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....licants as mentioned above is that only the assessment order based on estimate or opinion of the Income-tax Officer that the assessee has filed incorrect and false return to evasion of tax, is not sufficient to launch criminal proceedings and to prove the guilt of the assessee for punishment under sections 276C, 277/278B of the Act. The prosecution is required to adduce positive material to prove criminal charges, as per the principles of criminal jurisprudence. In the case of Prem Kumar Keshri [1998] 230 ITR 252, the Patna High Court has held that while the Income-tax Officer made an addition of Rs. 20,000 in the trading account on estimate basis, the Commissioner of Income-tax (Appeals) thought that the estimate was on the higher side and....