G VISWANATHAN Vs. INCOME TAX OFFICER

JUDGEMENT

(1.) Petitioner and respondent in both the cases are the same. Respondent Income Tax Officer is the complainant in CC Nos. 16 and 161 of 1986 on the file of the Additional Chief Judicial Magistrate (Economic Offences). Ernakulam and petitioner a cashew exporter, is the sole accused in both. Both the petitions are under S.482 of the Code of Criminal Procedure to quash the respective complaints. The only question for consideration is whether the allegations in the complaint constitute the offence.

(2.) Assessment of Income Tax for the years 1977-1978 and 1978-1979 were completed and the income tax outstanding payable were respectively Rs. 7,28,354 add 6,38,796/-. The properties of the petitioner including two air-conditioned theatres were attached for the arrears after issue of notice under R.2 of Schedule.2 by the Tax Recovery Officer after the certificate has been received by him from the Income tax Officer for recovery of the arrears. In violation of the prohibition contained in R.16 of Schedule.2 and the provision that transactions thereafter will be void, the petitioner executed two gift deeds in 1983 regarding the only two unencumbered items of immovable properties in his name in favour of his two children, both of whom were minors then. The objections based on these two documents were rejected.

(3.) By the time one of the sons became major. The major son by himself and the minor son through his grandfather (father inlaw of the petitioner) filed OS 26 of 1984 before the Sub Court, Quilon for a declaration that even though the documents of title are in the name of the petitioner they are the real owners, the properties being purchased with the funds supplied by the grandfather for their benefit. The Income Tax Recovery Officer applied to get himself impleaded in that suit but the application was opposed by the plaintiffs and it was dismissed. CRP 2577/86 against that order is pending before this Court. Defendants in that case are said to be the Central Government represented by the Chief Secretary to the State Government and the Government represented by the Government Pleader. The case of the respondent is that the properties belong to the petitioner himself having been acquired in his name in 1973 with funds accounted by him in his income tax accounts as his business income and that the gift deeds and the suit are only attempts by the petitioner to evade income tax.