TaxTMI 
TaxTMI 
1996 (12) TMI 24
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....nsel strenuously contends that the impugned orders are illegal and the same are liable to be set aside. On the other hand, learned counsel for the respondents strenuously supported the impugned orders. In order to appreciate the rival contentions of the parties, it is necessary to note the brief facts of the case. Accused No. 1 is a registered firm and accused Nos. 2 and 3 are its managing partners and accused Nos. 4 to 8 are its active partners. The firm carried on business in cigarettes of I.T.C. Limited at Vishakapatnam and also acted as wholesale distributors for Voltas products and also carried on trade in cloth at Vizianagaram. For the assessment year 1980-81 corresponding to the accounting year April 1, 1979, to March 31, 1980, the f....
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....is fact that an appeal was preferred by the accused before the Income-tax Appellate Tribunal is admitted by P.W.-1. It is also admitted that the Appellate Tribunal passed an order allowing the appeal and set aside the penalty proceedings by giving a finding that there was no concealment on the part of the accused. It is also brought on record that the Income-tax Appellate Tribunal dismissed their reference application, vide exhibit D-2. The learned judge of the Economic Offences court relied upon a judgment of the High Court of Patna in Banwarilal Satyanarain v. State of Bihar [1989] 179 ITR 387, and also a judgment of this court passed in Vandana (P.) Ltd. v. Asst. CIT, Crl. Petitions Nos. 22 of 1992 and 223 of 1992, on the file of the A. ....
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....r the criminal court. " Dealing with a similar situation the High Court of Madras in Mohamed I. Unjawala v. Asst. CIT [1995] 213 ITR 190 held as under : " So the question arises in which matters the criminal court may disregard the findings of the authorities under the Income-tax Act and in which matters weight has to be given to such findings. In this connection, I have to refer to the view of the Supreme Court in Patnaik and Co. Ltd. v. CIT [1986] 161 ITR 365, which I referred to above. The Supreme Court has accepted that the findings of the Income-tax Appellate Tribunal on the facts are final and the court has no jurisdiction to go behind the statements of fact made by the Tribunal. Therefore, the criminal court is bound to accept ....
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....secution, he cannot be convicted on the basis of the findings of the Tribunal because the criminal court has to follow the procedural law for trying an offender according to the Code and therefore the court cannot deviate from the Code for the reason that a finding has been arrived at by the authorities under the Income-tax Act. Only on account of such a situation the criminal court is expected to try the case independently according to the Code. But, the facts found by the Tribunal in favour of the assessee cannot be disturbed by the court as the Appellate Tribunal is the fact-finding authority under the Income-tax Act as held by the Supreme Court. Therefore, the contention of learned counsel, Mr. Ramaswamy, will not prevail and the submis....
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....ed the criminal revision petition on the ground that the proceedings before the criminal court and proceedings before the Department under the provisions of the Income-tax Act are entirely two different proceedings and that the proceedings before the criminal court could go on. The Supreme Court of India reversed the said judgment of the High Court of Punjab and Haryana (Uttam Chand v. ITO [1982] 133 ITR 911) and held that in view of the findings of the Appellate Tribunal that the assessee was a partner of the firm and the firm was genuine, the assessee could not be prosecuted on the ground of filing a false return. The Supreme Court observed as under : " Heard counsel, special leave granted. In view of the finding recorded by the Income....
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....994. " In view of the above law declared by the Supreme Court, it is clear that the finding recorded by the statutory authority, i.e., Income-tax Appellate Tribunal to the effect that there was no concealment of income on the part of the assessee, the criminal proceedings cannot be allowed to stand on the same allegations. However, a judgment of another learned single judge of this court in a decision in Ashok Biscuit Works v. ITO [1988] 171 ITR 300 (AP) has been brought to my notice. In this case the assessee had filed an earlier return and on the basis of his subsequent return penalty proceedings were initiated on the ground that the earlier return was by way of concealment. The learned single judge of this court held in that case that....