TaxTMI 
TaxTMI 
TaxTMI 
2023 (9) TMI 32
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....ource on more than 2664 occasions. The said total amount of Rs. 91,80,995/- had to be credited to the Central Government account within the stipulated time. However, the same was deposited with a time variation of 1 to 12 months. 3. According to the complaint, the assessee company after deducting tax under Section 192 to 194(c) of the Act failed to deposit the said amount, which is a default and wilful attempt to evade tax punishable under Section 276C of the Act. Show cause notice was issued on 18.01.2018 calling for explanation from the company and representatives, why proceedings should not be launched under Section 276B of the Act. Since there was no response to the show-cause notice, petitioners who are Managing director and Director ....
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.... received in the office of the Additional Commissioner of Income Tax on 01.02.2018. According to the acknowledgement in the reply, the case was adjourned to 18.02.2018. However, the said reply notice was not mentioned in the complaint dated 23.03.2018 and the sanction order dated 16.02.2018. For the said reasons, proceedings against the petitioners have to be quashed. 7. Learned Special Counsel for Income Tax submitted that there is no dispute regarding amount being paid on 14.12.2017 regarding interest of Rs. 4,67,670/-, late filing fee of Rs. 1,73,970/- and also the entire TDS amount of Rs. 91,80,995/- prior to the notice dated 18.01.2018. Learned counsel further submitted that the reply was also filed on 01.02.2018, however, the same wi....
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....ution nugatory." 8. Learned counsel further submitted that under similar circumstances when the entire amount was already paid and deposited, the Hon'ble Supreme Court held that if the payments are not made within the prescribed period in the statute, prosecution can be launched. The Hon'ble Supreme Court did not find favour with the judgment of the Calcutta High Court wherein the proceedings were quashed for the reason of payment of the defaulted amount though belatedly. For the said reasons, prosecution has to go on and petitioners have to face trial before the Special Court. 9. The Commissioner of Income Tax (TDS), Hyderabad granted sanction for prosecution of the petitioners and the Company on 16.02.2018. In the said sanction order, ....
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.... be accorded by the competent authority is for the purpose of affording protection from vexations prosecution and to safeguard the interest of the innocent persons. Before granting sanction, the competent authority has to go through all the relevant material placed before it and after assessing the facts of the case and if the competent authority deems it appropriate to grant sanction, accordingly sanction is given for prosecution. 14. The Hon'ble Supreme Court in several judgments held that the competent authority's sanction would be valid only when such competent authority applies its mind to the entire facts of the case and accords sanction. In the event of the sanction reflecting non-application of mind or not considering the relevant ....
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....cability of mind by the sanctioning authority to the facts of the case as also the material and evidence collected during investigation, it necessarily follows, that the sanctioning authority has to apply its own independent mind for the generation of genuie satisfaction whether prosecution has to be sanctioned or not. The mind of the sanctioning authority should not be under pressure from any quarter nor should any external force be acting upon it to take decision one way or the other. Since the discretion to grant or not to grant sanction vests absolutely in the sanctioning authority, its discretion should be shown to have not been affected by any extraneous consideration. If is shown that the sanctioning authority was unable to apply its....
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....ed taken place, the Court concerned would also keep in mind whether the objection touching the error, omission or irregularity in the sanction could or should have been raised at an earlier stage of the proceedings meaning thereby whether the same could and should have been raised at the trial stage instead of being urged in appeal or revision. 24. In the case at hand, the Special Court not only entertained the contention urged on behalf of the accused about the invalidity of the order of sanction but found that the authority issuing the said order was incompetent to grant sanction. The trial Court held that the authority who had issued the sanction was not competent to do so, a fact which has not been disputed before the High Court or b....