COMMISSIONER OF INCOME TAX V. STATE OF RAJASTHAN AND ORS

CRLA/564/2014

AI Insights

The case revolves around the appeal by the Commissioner of Income Tax, Jaipur-I against the judgment of the learned Additional Sessions Judge No.4, Jaipur Metropolitan, which had allowed the appeal of Bhagwan Das Thavarani, setting aside his conviction under Section 138 of the N.I. Act. The original conviction was based on the dishonor of cheques issued by Bhagwan Das to settle a liability assessed during an Income Tax survey. However, it was later revealed that the liability was revoked by the Income Tax authorities before the cheques were issued. The legal representatives of the deceased Bhagwan Das continued the appeal after his death, and the court found no grounds to overturn the lower appellate court's decision.

• Counselvise Citation: [2017] 140 COUNSELVISE.COM (IT) 727902 (HC-RAJASTHAN)
• Appeal Type: Others
• Pronouncement Date: 07-07-2017
• Assessment Year: misc
• Laws Referred To: N.I. Act, Cr.P.C.
• Result in Favour of: Revenue
• Court: HIGH COURT
• Department Lawyers: SANDEEP TANEJA
• Assessee Lawyers: ANUROOP SINGHI
• Keywords: Appeal; Conviction; Conviction; Dishonoured cheques; Income Tax; Legal representatives; Sentence
• Section: 138; 394(2)

Judgement Text

"HIGH COURT OF JUDICATURE FOR RAJASTHAN BENCH AT JAIPUR S.B. Criminal Appeal No. 564 / 2014 Commissioner Of Income Tax, Jaipur-I, New Central Revenue Building, Statue Circle, Jaipur (Raj.). ----Appellant Versus 1. State Of Rajasthan through PP. 2. Bhagwan das Thavarani S/o Late Shri Bishan Das (Deceased) Through LRs Shri Rajesh Thavarani Son of Late Bhagwandas Thavarani, resident of Plot No.86, Tripoliya Bazar, Jaipur. 3. M/s.Rajkumar Visandas, 86, Tripoliya Bazar, Jaipur. ----Respondents _____________________________________________________ For Appellant(s) : Mr. Anuroop Singhi. For Respondent(s) : Mr. Sandeep Taneja. _____________________________________________________ HON'BLE MR. JUSTICE DEEPAK MAHESHWARI Judgment / Order 07/07/2017 This appeal was registered after allowing the leave to appeal on 28.4.2014. The complainant – Commissioner of Income Tax, Jaipur-I has challenged the judgment dated 31.8.2013 by way of this appeal. Vide this judgment, learned Additional Sessions Judge No.4, Jaipur Metropolitan allowed the appeal preferred by Bhagwan Das Thavarani, sole Proprietor of M/s Rajkumar Visandas while setting aside the judgment dated 30.4.2013 passed by the learned Additional Chief Judicial Magistrate (Special Communal Riots), Jaipur Metropolitan, by which the accused – Bhagwan Das was convicted for the offence punishable under Section 138 of the N.I. Act and sentenced with two years simple imprisonment and fine (2 of 4) [CRLA-564/2014] of Rs. 1.5 crore. This is an undisputed fact that during the pendency of appeal, the appellant – Bhagwan Das Thavarani expired on 12.8.2013. The legal representatives of deceased Bhagwan Das pursued this appeal after obtaining permission of the Court under Section 394(2) Cr.P.C. Learned counsel for the complainant states that the cheques issued by accused Bhagwan Das to pay off the liability assessed during survey conducted by the concerned Income Tax authorities were dishonoured, thus, the conviction and sentence for the offence under Section 138 of the N.I. Act was properly imposed upon him. Per contra, learned counsel appearing on behalf of the respondent – Bhagwan Das (through his Legal Representatives) as also on behalf of M/s Rajkumar Visandas submits that no such liability was outstanding on the date of issuance of the cheques as also on their dishonourment, as in the subsequent proceedings the liability stood revoked as per the letter dated 29.5.2013 (Ex.-D/7) issued by Income Tax authorities. In view of the arguments aforesaid, it is pertinent to note that learned lower appellate court has taken note of this fact as follows :- “bl laca/k esa izn’kZ Mh&7 ,d cgqr egRoiw.kZ nLrkost gSA ;g vfllVSUV dfe’uj vkWQ bUde VSDl@lhihvkbZvks] lfdZy&1] t;iqj dk i= Øekad ,lhvkbZVh@lhvkbZvkj&1@tsihvkj@2013&14@312 fn0 29&05&2013 gS] tks fd vkjVhvkbZ ds rgr mDr (3 of 4) [CRLA-564/2014] foHkkx }kjk vihykFkhZ dks tkjh fd;k x;k gS] ftlesa vafdr gS fd dj fu/kkZj.k o\"kZ 2005&06 ,oa 2006&07 dk dj fu/kkZj.k fnukad 27&12&2007 ,oa 28&12&2008 dks lEiw.kZ gqvk Fkk rFkk fnukad 19&07&2005] 30&11&2005] 30&12&2005] 28&02&2006 ,oa 04&03&2006 dks fdlh Hkh rjg dh dksbZ VSDl fMek.M vk;dj vf/kfu;e 1961 ds varxZr Jh Hkxokunkl ds fo:) cdk;k ugha Fkh ,oa Jh Hkxokunkl ds fo:) fdlh Hkh izdkj dk dksbZ dj nkf;Ro ugha FkkA blesa ;g Hkh vafdr gS fd foRrh; o\"kZ 2005&06 ls 2011&12 rd fdlh Hkh izdkj dk dksbZ dj nkf;Ro ;k ekax Hkxokunkl ds fo:) cdk;k ugha FkhA bl izdkj izn’kZ Mh&7 ds voyksdu ls ;g ckr iw.kZ :i ls Li\"V gks tkrh gS fd losZ dh fnukad 19&07&2005 dks vfHk;qDr vihykFkhZ ds fo:) fdlh rjg dk dksbZ dj nkf;Ro vFkok _.k vk;dj foHkkx dh vksj cdk;k ugha Fkk vkSj u gh fookfnr pSdksa dh fnukad 30&11&2005] 30&12&2005 ,oa 28&02&2006 dks gh fdlh rjg dk dksbZ dj nkf;Ro vFkok _.k vfHk;qDr vihykFkhZ dk vk;dj foHkkx dh vksj ckdh FkkA”” There is quarrel on this aspect between the rival sides. Learned counsel appearing for the appellant has fairly conceded that in view of subsequent assessment made by concerned Income Tax Authorities, the earlier demand was not lying outstanding and was adjusted. It is, thus, factually clear that on 30.11.2005, 30.12.2005 and 28.2.2006, on which dates the disputed cheques were issued, there was no outstanding liability (4 of 4) [CRLA-564/2014] against the accused. In light of this factual matrix, the judgment passed by the learned lower appellate court appears to be perfectly legal, against which, no appeal can be allowed. Hence, the appeal preferred by the appellant–Commissioner of Income Tax is dismissed. The stay, which was granted vide order dated 28.4.2014 by this Court against the direction of the learned lower appellate court to refund Rs.30,00,000/- to the legal representatives of deceased Bhagwan Das Thavarani automatically stands revoked. (DEEPAK MAHESHWARI)J. Rm/18 "