HOMI PHIROZ RANINA Vs. STATE OF MAHARASHTRA

JUDGEMENT

(1.) THE applicants seek quashing of the order dated 30-11-1996 passed by the learned Additional Chief M. M. , 47th Court, Bandra in Cases No. 248-S to 251-S of 1993 and pray for their discharge in the said cases.

(2.) THE brief facts of the case are; a complaint came to be filed by the Income Tax Officer, T. D. S. VI, Bombay, against the present applicant/accused as well as M/s. Unique Oil India Ltd. of which the applicant/accused are directors as well as against Shri L. K. Khosla, Chairman and Managing Director of accused No. 1 company as well as Gayatri Khosla another Director and one Yogesh Khosla the whole time director of accused No. 1 company before the Additional Chief Metropolitan Magistrate, 47th Court, charging them under section 276 (b) r. w. 278 (b) of the Income Tax Act, 1961. Summons were issued to all the accused persons including the present applicants. On receipt of summons the applicants herein (accused Nos. 4, 5, 6 and 7) filed applications, for discharge before the M. M. Court on 31-10-1996. By his order dated 30-11-1996 the Magistrate rejected the discharge applications filed by the applicants/accused Nos. 4, 5, 6 and 7.

(3.) THE present application is for setting aside the said order which the applicants claim is passed on insufficient material. It is specifically contended that the lower Court has not taken into consideration the requirements of section 194 (c), sections 204 and 35 (2) of Income Tax Act. It is contended that the present applicants/accused are admittedly not the principal officers of the accused No. 1 company and therefore, not responsible for the failure on the part of the company to deposit with the Central Government the taxes deducted at source by the company from four contractors namely (i) M/s. Allied Consulting Engineers (P.) Ltd. , (ii) M/s. Shrinivas Plates and Structural Pvt. Ltd. (iii) M/s. Excellite Insulators Pvt. Ltd. and (iv) M/s. Kanaiya Construction Company. Though the company had deducted the tax payable by the said contractors while making payment to the contractors the company failed and neglected to remit the tax deducted to the treasury within the stipulated time. Admittedly, there is delay in remitting the tax deducted to the Central Government. As required under section 194 (c); the tax had to be credited to the Central Government by 7th May, 1989. However, the same was paid to the credit of the Central Government only on 30-5-1989. The tax deducted had to be credited to the Central Government within one week from the last date of the month in which deduction is made.