AI Drafter 
TaxTMI 
TaxTMI 
2018 (6) TMI 103
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....eets, meals and other eatables running their business under the name and style of M/s Sharma Misthan Bhandar situated at The Mall, Bathinda; that such concern had filed return of income tax for the assessment year 1987-88 at Rs. 64,720 on 27.7.1987 duly signed and verified by accused Pardeep Kumar as partner of the firm; that statement was accompanied by the statement of computation of income for the year ending 31.3.1987 along with four challans of tax, total amounting to Rs. 4,708/- as well as Form No.12 i.e. for making declaration under Section 184(7) of the Act for continuation of registration of the firm; that the income was processed under Section 143(1) of the Act and the return of income was accepted, however, subsequently on perusa....
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....s against 41.43% shown in the return; that according to return of the income, the assessee had introduced new cash credits as under: 1. Smt.Geeta Devi - Rs. 8,500/- 2. Smnt.Savitri Devi w/o Sh.Som Dutt - Rs. 5,000/- Those cash credits were found to be bogus. The Assessing Officer vide order dated 11.7.1989 required the Assessee to produce Savitri Devi and Geeta Devi, however, they failed to put in appearance. In the reply filed, it was stated by Geeta Devi and Savitri Devi, that the creditors were not inclined to come in the Court since that was prohibited by their customs. The Assessing Officer deputed the Inspector to record the statement of the accused Nos.4 and 5 at their residence and their statements were recorded....
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....n Jain (ITO Retd.) as CW2. During the proceedings, accused Som Dutt had died, as such proceedings against him stood abated. Regarding remaining accused, they were charge-sheerted under Section 276-C read with Section 277 & 278(B) of the Act, to which, they pleaded not guilty and claimed trial. The trial Court had formulated the following points for determination, which are as under: 1) Whether accused Pardeep Kumar, is the partner of accused No.1 and has willfully attempted to evade the tax, penalty and interest chargeable, imposable under the Income tax Act? 2) Whether accused Geeta Devi and Savitri Devi have assisted accused firm in evading the tax, penalty and interest chargeable, imposable under the Income Tax Act? ....
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....n the return and it was found that since the assessee No.1 enjoys the income of the sale of sweets meals, Puri, Kachori, Lassi etc. and does purchase sugar, maida, vanaspati etc., no sale on account of Bardana has been credited in its books of account and consequently, on account of said sale of Bardana, Rs. 6,000/- were added to its income. The total income was assessed at Rs. 2,67,540/- u/S 143(3). Penalty proceedings u/s 271(1)(c) and 273(2) (a) were initiated for furnishing inaccurate particulars of income. Accused aggrieved against that order dated 31.7.89 passed by the Assessing Officer, preferred an appeal, who however, upheld the addition made on account of cash credits i.e. Rs. 13,500/- and Rs. 6,000/- on account of sale of Bardana....
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.... impugned judgment of acquittal passed by the trial Court, therefore, the acquittal of respondents No.1 and 2 was upheld. Learned Additional Sessions Judge (Fast Track Court), Bathinda has given the following reasoning while arrived at this conclusion: After hearing the rival submissions and going through the evidence on record, it is made out that the appellant filed a complaint against the respondents with the allegations that respondents have willfully made an attempt to evade tax, penalty, chargeable and imposable under the Act and accused No.4 & 5(now respondents No.1 & 2) abetted accused no.1 to 3 (now respondents no.3,4, 5) to deflate the income and to enable them to evade tax and penalty and further for furnishing wrong inf....
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....at they could not earn this amount so it cannot be taken their income. Then he included this amount in the income of assessee firm i.e. respondent No.3. It has been rightly contended for the learned counsel for the respondent that Rajinder Singh has not been examined as a witness in the Court who recorded their statements so those statements cannot be taken into evidence as per rules of law of evidence. A criminal Court has to decide the case on the basis of independent evidence. It cannot base the conviction on the report submitted by the Assessment Valuation Officer, on the basis of which the department has made the assessment of the income of the assessee. As far as allegations of abetment are concerned, this fact is al....