TaxTMI 
TaxTMI 
1995 (4) TMI 45
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....aling with the grievances made by the petitioners, it would be appropriate to refer to the factual background. Petitioner No. 1 is a partnership firm, whereas petitioner No. 5 is a private limited company incorporated under the Companies Act, 1956. Petitioners Nos. 2, 3 and 4 are partners of petitioner No. 1 and petitioner No. 6 is the director of petitioner No. S. A complaint was filed by respondent No. 2 in the Court of the Special Judicial Magistrate, Muzaffarpur, alleging, inter alia, that petitioner No. 1 was engaged in the business of leasing equipment like air-conditioners, etc., and pays a commission of Rs. 66,500 to petitioner No. 5. On scrutiny, this was disallowed and added to the total income of petitioner No. 1. Penalty proceed....
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....500 to its sister concern for maintenance charges in the assessee-firm first year. On the aforesaid finding, the said entire amount was disallowed and, as stated above, the same was added back and a penalty proceeding was initiated. Being aggrieved by the aforesaid order dated March 27, 1991, Petitioner No. 1 filed a statutory appeal before the Commissioner of Income-tax (Appeals) which was registered as Appeal No. 80/JSR of 1991-92. By an order dated March 24, 1992, as contained in annexure 4, the appellate court set aside the assessment order by observing as follows : " I have carefully considered the above arguments. I have also gone through the certificates issued by the companies to whom the air-conditioners have been leased out. In ....
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....eding under section 271D of the Act was initiated. Against the said proceeding, the petitioners moved the appellate authority, Jamshedpur, in Income-tax Appeal No. 150/(SSR) of 1991-92, and by order dated February 6, 1992, the said appeal was allowed. It appears that when again a fresh penalty proceeding was initiated in respect of the same amount, the petitioners again moved the appellate authority in Income-tax Appeal No. 369 of 1994-95. By an order dated November 14, 1994, the said appeal was partly allowed. The aforesaid orders dated February 6, 1992, and November 14, 1994, passed by the appellate authority have been annexed as annexures 9 and 10, respectively, in the supplementary affidavit. This factual position has not been controv....
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....e findings of the authorities cannot be held to be binding on the criminal court. In support of his contention, he has relied upon a Division Bench decision of this court in the case of Surendra Kumar Jhunjhunwala v. State of Bihar [1991] 1 BLJ 468. On the premises of the aforesaid submissions made on behalf of the parties, the question which is required to be answered is whether a criminal proceeding should be allowed to continue when the basis of which has been nullified by a superior authority under the Act. It is not in dispute that the appellate order is dated March 24, 1992, whereas the complaint was filed on March 28, 1992. This finding of the appellate court has not been challenged and, as such, it reached its finality. A close r....
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.... Banwarilal Satyanarain v. State a Bihar [1990] PLJR 107. The petitioners in that case moved this court against the order refusing discharge in a criminal prosecution under section 276B of the Act. His Lordship, while considering the import of section 276B vis-a-vis sections 201 and 221 of the Act, observed that : " I am clearly of the view that the process of the criminal court should not be allowed to be abused in cases where an assessee has succeeded in proving good and sufficient reasons for his failure before an authority under the Act in a penalty proceeding ". In the aforesaid case, this court quashed the prosecution on the ground that during the pendency of the criminal prosecution, the penalty imposed by the Income-tax Officer and....