GOPAL DAS MOHTA Vs. UNION OF INDIA

JUDGEMENT

(1.) The petitioner in this matter is a resident of Akola in the State of Madhya Pradesh and carries on business in various lines i.e., oil mills, banking money lending, etc. It is alleged that during the war years he made huge profits but evaded payment of tax. In the year 1948 the Central Government acting under Section 5(1) of the Taxation on Income (Investigation Commission) Act. 1947, referred his case to the Investigation Commission for investigation and report, in respect of the profits made by him during the period commencing with 1st of January 1939 and ending on 31st of December 1947. The Commission, after investigation, reported on the 28th of February 1951 that the income of the petitioner concealed and withheld from taxation was in the sum of Rs. 27,25,363 / and the tax payable by him amounted to Rs. 18,44,949/-.

(2.) During the pendency of the investigation the petitioner applied for settlement under the provisions of Section 8-A of Act XXX of 1947. This application was forwarded along with the report by the Commission to the Central Government. In the settlement application the applicant proposed that he was prepared to pay the sum of Rs. 18,44,949/- as under: On or before 25-6-1951-Rs. 3,44,949/- On or before 25-3-1952-Rs. 5,00,000/- On or before 25-3-1953-Rs. 5,00,000/- On or before 25-3-1954-Rs. 5,00,000/ and that he be given credit for a sum of Rs. 32,034-4-6 already paid by him. The Central Government accepted this proposal and the claim for evaded income-lax was thus finally settled by mutual agreement. The assessee, subsequently, asked for more time to pay these instalments and this was also granted from time to time.

(3.) Commencing from 16th of July 1951 and till the 10th April 1954 the petitioner paid a total sum of about Rs. 14,00,000 /- towards discharge of the liability voluntarily agreed to by him on account of the tax evaded. A sum of Rs. 4,50,000/- still remains due and is payable in instalments up to the 25th of March 1955. By one of the terms of the settlement the petitioner undertook not to transfer, mortgage, charge or alienate or encumber in any manner whatsoever any of his movable or immovable properties, barring stock-in-trade of the business, except with the permission of the Commissioner of Income-tax and except for the, purpose of the payment of the tax due under the settlement.