STATE Vs. HALLEY MATHEW

JUDGEMENT

(1.) This appeal is by the State against acquittal. The accused, Halley Mathew, was the principal officer of the Malabar Agricultural Company Ltd., Kottayam, and in that capacity he is stated to have deducted on April 20, 1961, a sum of Rs. 22,213.11, as income-tax from the dividends declared by the company for the year ending June 30, 1960, but the same was not credited to the Central Government as required by the Income-tax Act and Rules. Hence he was charged under Section 276(d) of the Income-tax Act, 1961 (shortly stated "the Act") for the period of default up to April 1, 1968, and thereafter under Section 276B of the said Act as amended by the Finance Act, 1968, for the period of default after April 1, 1968. The charge was denied by the accused. He stated that he was not the principal officer of the company at the time and that no deductions were made by him in that capacity. He also denied the letters produced by the prosecution alleged to have been sent by him as principal officer of the company to the Income-tax Officer, Company Circle, Ernakulam.

(2.) The respondent (accused), Halley Mathew, was the appellant in Criminal Appeal No. 377/70, which arose from S.C. No. 18/70. There also, as in the present case which has arisen from S.C. No. 23/70, these points had come up for consideration. In that case and a few other connected cases, the learned sessions judge found the accused guilty under Section 276(d) for the default up to April 1, 1968, and acquitted him of the other charge, viz., default for the period after April 1, 1968. The points have been thrashed out in detail in Criminal Appeal No. 377/70 and the connected State Appeal No. 78/71. In the present case unlike in the other cases the learned judge has found against the prosecution on both the counts. In other words, the accused has been acquitted in respect of the charge under Section 276(d) also, and the reasoning of the learned judge is that in this case the offence was committed under the 1922 Act and that offence did not survive after the 1922 Act was superseded by the present Act of 1961 under which the charge is brought.

(3.) On the question whether the accused was the principal officer of the company at the time and whether the tax was deducted by him in that capacity, I think I need not labour much in this case as that point has been covered in my judgment in Criminal Appeals Nos. 377/70 and 78/71. The reasoning adopted by me in that judgment in respect of that point holds good in the present case also. PW-2 was the Income-tax Officer, Company Circle, Ernakulam, from July, 1966, to May, 1970, and during the period various letters and statements had been submitted to him by the accused as the principal officer of the company. They were being habitually submitted to him and PW-2 was thus familiar with the handwriting and signature of the accused. The Explanation to Section 47 of the Evidence Act is, therefore, attracted and PW-2 must be deemed to be competent to prove the signature and hand-writing of the accused. The relevant documents are exhibits P-3 to P-10 and P-15 to P-17. I accept the finding, therefore, that the documents were submitted by the accused for the company. With regard to the question whether he had done so in his capacity as principal officer, the reasoning adopted by me in my judgment in Criminal Appeal No. 377/70 is applicable here also and I accept the finding that he was the principal officer of the company. From exhibits P-4 and P-5 it is seen that the amounts were paid only on September 11, 1961, and January 18, 1969. It has, therefore, to be held that the accused failed to pay within 7 days of the date of deduction as provided in Rule 10(b) of the Income-tax Rules framed under the 1922 Act, which is identical with Rule 30(1)(b) of the Rules under the 1961 Act.