TaxTMI 
TaxTMI 
TaxTMI 
2025 (7) TMI 1314
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....ure Code (Cr. P. C.) was set aside. 3. On 5 March 2012, none appeared for the Respondent-Commissioner of Income Tax. On 19 March 2012, also none appeared for the Commissioner of Income Tax-Respondent. On 2 April 2012, this Court noted the above absence of appearances on behalf of the Commissioner of Income Tax and passed the following order: "1. These three revision Applications show seriousness with which the Income Tax Department deals with the cases pending in which interim orders were passed on 30th January, 2012. Interim orders were continued on 5th March, 2012 as none appeared for the Union of India. Again on 19th March, 2012, none appeared for Union of India. Interim orders were continued. Today none appears for the Union of India. Issue fresh notice to the Respondent indicating that the matter would be disposed of admission stage on 16th April, 2012 irrespective whether Respondent appears on not. 2. Learned counsel for the Applicant to file entire compilation of record from the trial Court. Stand over to 16.04.2012." 4. On 11 June 2012, again, none appeared for the Respondent-Income Tax Department. This Court, therefore admitted the matter and granted interim stay a....
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....dent No. 1 made an Application under Section 319 of the Cr.P.C. before the learned Metropolitan Magistrate praying for impleading Applicant Nos. 2 to 4 as "accused" along with accused No. 1 firm in the trial. Applicant Nos. 2 to 4 filed their reply and opposed the Application under Section 319 of Cr.P.C. 13. The Metropolitan Magistrate, vide order dated 21 January 2009, dismissed the Application under Section 319 of Cr.P.C. primarily on the ground that no sanction of Commissioner of Income Tax has been obtained against Applicant Nos. 2 to 4 for proceeding as an accused. Learned Magistrate also observed that when the complaint was filed deceased Kapoorchand Jain was treated as a partner incharge of day-to-day affairs of Respondent No. 1-firm. 14. The aforesaid order of the learned Metropolitan Magistrate dismissing the Application of Respondent No. 1-CIT under Section 319 of Cr.P.C. was challenged by Respondent No. 1 before the learned Sessions Court by filing Criminal Revision Application. The learned Sessions Judge by his order dated 18 November, 2011 set aside the Metropolitan Magistrate's order and allowed the Application filed by Respondent No. 1 under Section 319 of Cr.P.C. ....
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....propriate authority. In the absence of any sanction as required under Section 279 of the Income Tax Act, the Application under Section 319 of Cr.P.C. to make Applicant Nos. 2 to 4 as accused is without jurisdiction. Therefore, even on this count Application made under Section 319 of Cr.P.C. is required to be rejected. The Supreme Court in the case of Surinderjit Singh Mand & Anr. State of Punjab & Anr. (2016) 8 SCC 722 has held that even for the purpose of Section 319 of the Cr.P.C., mandatory sanction required by Section 197 of the Cr. P.C. or by a special statue has to be complied with. 19. The basis of Application under Section 319 of Cr.P.C. is evidence recorded of Mr. A. P. Shrivastava who was posted as Assistant Director of Income Tax in 1982 at Mumbai. In the said evidence it is the case of Respondent No. 1 that they came to know that there were four partners of the firm having share in the range of 20-25% and one minor partner having share of 5 %. In the evidence, it is also recorded that accused No. 1-firm had filed Form No. 12 for continuation of registration as a firm in which each of the partner had signed. Form No. 12 was already filed with the Income Tax Department i....
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....6. Thus, we hold that though only a p rima facie case is to be established from the evidence led before the court, not necessarily tested on the anvil of cross-examination, it requires much stronger evidence than mere probability of his complicity. The test that has to be applied is one which is more than p rima facie case as exercised at the time of framing of charge, but short of satisfaction to an extent that the evidence, if goes unrebutted, would lead to conviction. In the absence of such satisfaction, the court should refrain from exercising power under Section 319 CrP.C......" 22. Section 319 of Cr.P.C. provides that where in the course of any inquiry into, or trial of, an offence, it appears from the evidence that any person not being the accused has committed any offence for which such person could be tried together with the accused, the Court may proceed against such person for the offence which he appears to have committed. 23. In the instant case before me, the evidence which is relied upon on the basis of which an Application under Section 319 is made by Respondent No. 1 is the evidence of Mr. A. P. Shrivastava, Assistant Director of Income Tax dated 16 August 2007 ....
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.... such offence. (2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to any neglect on the part of, any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of that offence and shall be liable to be proceeded against and punished accordingly. (3) Where an offence under this Act has been committed by a person, being a company, and the punishment for such offence is imprisonment and fine, then, without prejudice to the provisions contained in sub-section (1) or sub-section (2), such company shall be punished with fine and every person, referred to in sub-section (1), or the director, manager, secretary or other officer of the company referred to in subsection (2), shall be liable to be proceeded against and punished in accordance with the provisions of this Act. Explanation. - For the purposes of this section,- (a) "company" means a body corporate, and includes- (i) a firm; and (ii) an association of ....
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....t, learned Session Judge erred in allowing the application under Section 319 of the Cr.P.C. filed by the respondent No. 1 and thereby directing impleadment of applicant Nos. 2 to 4 as" accused". 33. The Supreme Court in the case of State of Karnataka vs. Pratap Chand and Ors. (1981) 128 ITR 573 was concerned with the provisions of Sections 18, 18 A and 34 of the Drugs and Cosmetics Act 1940, which is pari materia to Section 278B of the Income Tax Act. The Supreme Court observed that a partner is liable to be convicted for an offence committed by the firm if he was in charge of and responsible to the firm for the conduct of the business of the firm or if it is proved that the offence was committed with the consent or connivance or was attributable to any neglect on the part of the partner. A person "in-charge" must mean that person should be in overall control of the day to day business of the firm. Similar view has also been expressed by the Kerala High Court in the case of M. A. Unneerikutty & Ors. Vs. Deputy Commissioner of Income-Tax (Assessment) (1996) 218 ITR 606. 34. In my view, both the above decisions would squarely apply to the facts of the present case before me and th....