KAUSHAL KISHORE BIYANI Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS is an application filed by the applicant under Section 482 of the Code of Criminal Procedure for quashment of Criminal Case No. 10/92 pending before the Addl. Chief Judicial Magistrate (Economic Offences), Indore.

(2.) THE non -applicant -Income Tax Department filed a criminal complaint on 14 -2 -92 alleging that for the assessment year 1987 -88 corresponding to the previous year ending 30th June, 1987, the firm M/s Shrinath Drillers did not deduct TDS at 1 %. The applicant Kaushal Kishore was the acting partner of the firm. After the default was pointed out to the firm and its partner by the non -applicant -Department, they deposited the amount of TDS from their own account and submitted that this was the first year of their business, they were not aware of the statutory requirement in this regard under the Income -Tax Act.

(3.) THE submission of the learned counsel for the applicant is that prior to 1 -4 -89, the provision under Section 276B was prescribing that if a person fails to deduct or after deducting fails to pay the advance, as required by or under the provisions of Sub -section (9) of Section 80E or Chapter 17 -B shall be punishable. The aforesaid provision of Section 276B was amended by the Direct Tax Laws (Amendment) Act, 1987 with effect from 1 -4 -1989 which prescribes punishment for failure to pay tax deducted at source. Thus, upto 1 -4 -1989, failure to deduct TDS was also an offence but after 1 -4 -1989, only if a person deducted the TDS, but did not pay the lax then it was an offence.