Shyam Sunder Prasad, Director, Ashok Cold Storage Ltd. V. The Union of India through Shri Amitabh Kumar, Assistant Commissioner of I.T. Inv. (Circle-2), Patna

CR. MISC./20262/1998

AI Insights

The case involves Shyam Sunder Prasad, the director of M/s Ashok Cold Storage Ltd., who sought to quash the criminal prosecution initiated against him and his firm under sections 276-C and 277 of the Income Tax Act, 1951, related to the assessment years 1985-86. The prosecution was based on allegations of tax evasion. The petitioner argued that the assessment orders for the years in question were set aside by the Commissioner of Income Tax Appeal-I, Patna, in 1998. However, the necessary documents to support these claims were not presented in court. The Income Tax Department's counsel acknowledged the difficulty in locating the relevant orders but cited a Supreme Court judgment emphasizing the independence of criminal proceedings from departmental assessments. The High Court of Patna, after hearing the arguments and considering the lack of documentary evidence, decided not to grant relief to the petitioner at this stage but allowed for the possibility of reconsideration if the relevant appellate orders were presented later.

• Counselvise Citation: [2010] 140 COUNSELVISE.COM (IT) 818575 (HC-PATNA)
• Appeal Type: Others
• Pronouncement Date: 04-05-2010
• Assessment Year: misc
• Other Referred Cases: P.Jayappan Vrs. S.K.Perumal, A.I.R. 1984 SC 1693
• Laws Referred To: Cr.P.C., Income Tax Act, 1951
• Result in Favour of: Others
• Court: HIGH COURT
• Department Lawyers: RISHI RAJ
• Keywords: Appellate order; Assessment years; Charges framed; Income Tax; Quashing of criminal prosecution; Cognizance taken
• Section: 482; 276 C; 277

Judgement Text

" IN THE HIGH COURT OF JUDICATURE AT PATNA Cr.Misc. No.20262 of 1998 SHYAM SUNDER PRASAD, DIRECTOR, M/S ASHOK COLD STORAGE LTD., P.O. SOHSARAI, DISTT. NALANDA AT BIHARSHARIF………………………………….. PETITIONER Versus THE UNION OF INDIA THROUGH SHRI AMITABH KUMAR, ASSISTANT COMMISSIONER OF I.T. INV. (CIRCLE-2), PATNA………………………………………… OPP.PARTY. ----------- 5 4-05-2010 Heard learned counsel for the petitioner and Mr. Rishi Raj, learned counsel appearing for the Income Tax Department, the complainant. 2. This application under section 482 of the Cr.P.C. has been filed for quashing of the entire criminal prosecution arising out of Complaint Case No. 54 ( C )/1992 pending before Special Sub-Judge, Economic Offences Court, Patna and for quashing of order dated 26-6-1995 whereby the learned court below decided and framed charges under sections 276-C and 277 of the Income Tax Act, 1951 in relation to assessment years 1985-86 against the petitioner as well as against the Firm M/s Ashoka Cold Storage Ltd., Sohsarai, Nalanda which has not joined this quashing application. 3. On behalf of petitioner reliance has been placed only on the averments made in the quashing application but neither the assessment order nor the appellate order has been annexed. Even the order taking cognizance dated 3-4-1992 or the actual order deciding to frame charges passed on 26-6-1995 has not been brought on record. In paragraph-5 it has been stated that cognizance was taken in the case on 3-4-1992 on the 2 basis of complaint petition contained in annexure-1 and subsequently charges were framed on 26-6-1995. In paragraph- 6 the material averments are by way of submission that the petitioner had challenged the assessment order for the years 1985-86 and 1986-87 before the Commissioner of Income Tax Appeal- I, Patna and by order dated 10-7-1998 he had set aside the order of the assessment year 1985-86 and 1986-87. 4. Learned counsel for the Income Tax Department has fairly submitted that although opportunity was given to seek instruction on 19-4-2010 but the appellate order or the assessment order could not be located and he has been given only limited instruction which show that petitioner was also representing another firm M/s Ashoka Engineeing Ltd for the year 1987-88 and 1988-89. He approached the Settlement Commissioner Additional Bench, Calcutta and his settlement application was admitted for assessment years 1987-88 and 1988-89 but the settlement application for the assessment years 1985-86 and 1986-87 was rejected and against that he has preferred C.W.J.C.No. 10805/94. Thus, it appears that in spite of efforts the counsel representing the Department has not been able to get instruction on the relevant facts. On law he has referred to several judgments including a judgment of the Supreme Court in the case of P.Jayappan Vrs. S.K.Perumal, reported in A.I.R. 1984 SC 1693 to highlight the proposition of law that the criminal court has to give due regard to the result of any 3 proceeding under the Act having a bearing on the question in issue and in an appropriate case it may drop the proceedings in the light of an order passed under the Act but it does not mean that the result of a proceeding under the Act would be binding on the criminal court . The Criminal Court has to judge the case independently on the evidence placed before it. Otherwise there can be a danger that only because the persons concerned fails to convince the authorities in a proceeding under the Act the Criminal Court may be deemed bound by such order resulting into conviction. 5. The hearing of this case was adjourned also to enable learned counsel for the petitioner to produce before this Court the relevant order noticed above which are not available on record but those orders have not been produced. 6. In the aforesaid facts and circumstances, although petitioner has succeeded in quashing of the criminal case by this court vide annexure-2 in relation to another assessment year, this application has to be disposed of in a different manner because the relevant records are not before this Court. This application is, therefore disposed of without granting any relief to the petitioner at this stage. However, liberty is granted to the petitioner to bring the relevant appellate order mentioned in paragraph-6 of the quashing application before the court below and as observed by the Supreme Court in the case of P.Jaya (supra) the court below shall give due regard to that 4 appellate order and the ultimate result of the assessment proceeding for the assessment year in question and if it is of the view that the result requires the criminal proceeding to be withdrawn in the light of the orders passed by the Departmental Authority, it may order accordingly or else it shall proceed with the case in accordance with law. This application is accordingly disposed of. Naresh ( Shiva Kirti Singh, J.) "