P.ARULMUDI Vs. ASSISTANT COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) This criminal original petition has been filed to quash the proceedings in EOCC.No.23 of 2019 pending on the file of the Additional Chief Metropolitan Magistrate Court (E.O-II), Egmore, thereby taken cognizance for the offence under Sec. 276CC of Income Tax Act, 1961, as against the petitioner.

(2.) The respondent filed complaint for the offence punishable under Sec. 276 CC of the Income Tax Act, 1961 (hereinafter called as 'the Act'). for the assessment year 2013-2014. The crux of the complaint is that the petitioner failed to file his return of income for the assessment year 2013-2014 as required under Sec. 139 of the Act. He is duty bound to file his return of income on or before 30/9/2013 for the assessment year 2013-2014. A search was conducted as per Sec. 132 of the Act on 3/9/2013. Subsequent to the search, a notice was issued as contemplated under Sec. 153A of the Act, thereby called upon to file his return of income within a period of 30 days from the date of receipt of the notice. It was duly received and the petitioner failed to file his return of income within the time mentioned in the notice. Once again, a reminder letter was also sent to the petitioner dtd. 15/7/2014 and 2/6/2015. The petitioner filed reply on 8/6/2016, but no valid reasons were stated for non filing of return of income. But he filed the same only on 19/7/2016 with a delay of more than 15 months and thereby declared his total income of Rs.2,32,48,580.00 for the assessment year 2013-2014. Non filing of the income tax return within the time limit is wilful and deliberate on the part of the petitioner. The assessment proceedings was completed for the assessment year 2013-2014 on 12/8/2016 thereby the total income of Rs.3,98,72,510.00 was determined against the returned income filed by the petitioner to the tune of Rs.2,32,48,580.00. Therefore, the penalty proceedings were initiated and imposed penalty under Sec. 271F of the Act on 28/2/2017 for non filing of the return of income under Sec. 139(1) of the Act.

(3.) Mr.C.Emalias, the learned counsel appearing for the petitioner would submit that on 3/9/2013, there was a search under Sec. 132 of the Act in the companies which were aggregating land for a setting up of SEZ for companies based out of New Delhi. The petitioner is being a legal consultant to the companies was also searched on 3/9/2013. During the search, the authorities had seized bills raised and agreements that he had entered in connection with his legal consultancy work and the same were in custody of the authorities. Therefore, the petitioner was not able to file his return within the due date. The seized documents were returned to the petitioner only after the due date. Thereafter, the petitioner was issued notice under Sec. 153A of the Act to file their return of income for previous six consecutive years for the assessment year 2008-2009 to 2014-2015 within a period of thirty days. Though the provision under Sec. 153B of the Act provides two years for completion of the assessment, the petitioner was provided only one month to file his return of income, that too for all the six assessment years. After receipt of the reminders from the authorities, the petitioner had sent reply stating that there was an erroneous calculation of tax that is due and tax deducted at source was not adjusted to the tune of Rs.47,66,509.00 for the assessment year 2013- 2014 since it was deducted before the due date. The petitioner had collected service tax to the tune of Rs.52,18,727.00 and had duly paid on 15/5/2014. Therefore, the petitioner sought for further time to file his return of income for all six previous assessment years. Therefore, the delay is only for bonafide reasons and not wilful or wanton.