SITABEN Vs. UNION OF INDIA

JUDGEMENT

(1.) THIS petition under S. 482, CrPC, has been directed against framing of charges under ss. 276B and 278B of the IT Act, 1961 (hereinafter referred to as "the Act"), against all the petitioners with a further prayer for quashing the proceedings.

(2.) IT is not in dispute that accused No. 1 is a firm and accused Nos. 2 to 8 are its partners. They are carrying on the business of purchase and sale of black steel tubes, PVC pipes, G.I. steel tubes and allied products. The firm submitted a return of income for the year 1984 85, on 28th July, 1984, declaring an income of Rs. 98,240 and further furnished particulars of interest and credit. Rupees 12,617 were credited to M/s Precision Tubes and Rs. 7,845 were credited to M/s Jotindra Steel & Tubes Ltd., but the petitioners failed to deduct tax out of these amounts. This was brought to their notice. The contention of the petitioners was that deduction was not by way of interest, but was a penal Batav. The same was not accepted by the IT Department. The petitioners, thereafter, deducted the tax Rs. 4,094 at source, and deposited it after 36 months, though it was also short by Rs. 202.

(3.) THE contention of learned counsel for the petitioners is that all the partners of the firm including the so called sleeping partners have also been made accused in the case. Since they were not in charge of the business, they cannot be convicted. Hence, the prosecution is bad. The second contention of learned counsel for the petitioners is that since this is a criminal prosecution, it is for the prosecution to show as to how many partners were in charge of the business and in the absence of such averment and proof they cannot be prosecuted. As against this the contention of learned counsel for the Union of India is that not only the person who was in charge of and was responsible to the company for the conduct of the business, but the company as well shall be deemed to be guilty of the offence and, here, company includes firm and its partners as well. As such they have rightly been prosecuted. The second contention of learned counsel for the Union of India is that it is for the person who is accused to prove that the offence was committed without his knowledge or that he has exercised all due diligence to prevent the commission of such offence. It has also been submitted that the accused petitioners have put no question to the prosecution witness suggesting that they or any of them were not in charge of or responsible to the company for the conduct of business.