Madhya Pradesh H.C : Learned counsel for the applicant has submitted that mens rea is a requisite ingredient of offence under s. 276B of the IT Act

High Court Of Madhya Pradesh : Indore Bench

Vijaysingh vs. Union Of India & Anr.

Sections 276B, 278B

Asst. Year 1985-86

Ashok Kumar Tiwari, J.

CRL. Revn. No. 34 of 1999

7th March, 2005

Counsel Appeared

H.S. Oberai with P. Prasad, for the Applicant : R.L. Jain, for the Respondents


Ashok Kumar Tiwari, J. :

This revision has been filed against the judgment and order dt. 12th Jan., 1999, passed by learned First Addl. Sessions Judge, Indore (Shri Shreeram Sharma), in Crl. Appeal No. 62/1996.

2. A prosecution was launched against the applicant along with the co-accused on the ground that they failed to deposit the amount of TDS within the period prescribed therefor. The learned Addl. Chief Judicial Magistrate (Economic Offences), Indore (Dr. Anil Pare), vide his judgment dt. 12th March, 1996, passed in Crl. Case No. 12/1987, held the accused persons guilty under s. 276B r/w s. 278B of the IT Act and each of them was sentenced to undergo three months’ simple imprisonment with fine of Rs. 2,000 and in default of fine to undergo further imprisonment for one month. The accused persons, then, filed an appeal against the order of conviction and sentence. The learned First Addl. Sessions Judge, Indore, vide impugned judgment allowed the appeal of the co- accused and acquitted them, however, dismissed the appeal filed by the applicant and confirmed the sentence imposed on him. The appeal filed on behalf of the appellant No. 1 firm was also dismissed. Hence, this revision has been preferred by the applicant.

3. Learned counsel for the applicant has submitted that mens rea is a requisite ingredient of offence under s. 276B of the IT Act, which is not proved in the present case. Hence, applicant could not be convicted. This contention of the learned counsel for the applicant cannot be accepted. In the light of Dy. CIT vs. Modern Motor Works & Ors. (1996) 133 CTR (P&H) 259 : (1996) 220 ITR 415 (P&H) mens rea is not necessary to be present. Offence under s. 276B of IT Act is complete when the tax deducted at source is not deposited in time.

4. The contention of the learned counsel for the applicant is that the prosecution of the applicant was not proper at the belated stage when he had already deposited the amount of tax deducted at source. He has submitted that in view of the circular dt. 28th May, 1980 of Finance Department, no prosecution should have been launched. Per contra, learned counsel for non-applicant has submitted that the instructions cannot replace the relevant provisions of statute, which provide punishment and the Departmental instructions have to give way to these provisions.

5. The aforesaid controversy is squarely covered by the case of Bee Gee Motors & Tractors & Anr. vs. ITO (1995) 127 CTR (P&H) 224 : (1996) 218 ITR 155 (P&H). The relevant Instructions read thus :

“The prosecution under s. 276B should not normally be proposed when the amount involved and/or the period of default is not substantial and the amount in default has also been deposited in the meantime to the credit of the Government. No such consideration will, of course, apply to levy of interest under s. 201(1A).”

6. In the present case, undisputedly the tax deducted at source was deposited when the authorities considered the case for launching prosecution. The delay in depositing the amount is not substantial in the present case, as the delay is said to be of about five months and some days and the amount involved is Rs. 28,776, which cannot be said to be very huge. In such a situation, the authorities concerned should have considered the matter in the light of the instructions contained in the relevant circular. When the conditions for exempting the assessee from prosecution are available, it will not be open for the authorities then also to have discretion in the matter of launching prosecution. If the contention of the learned counsel that when the offence is committed, it was the discretion of the authorities concerned to launch the prosecution or not, is accepted, it will lead to a situation that the authorities concerned may exempt the assessee from prosecution in one set of circumstance and to prosecute another assessee in the same or identical set of circumstances and that would violate Art. 14 of the Constitution of India. Therefore, the contention of the learned counsel for non-applicant cannot be accepted. The relevant provisions of statute and the instructions quoted above are not inconsistent to each other. Where there is conflict between the instructions and the provisions of statute, no doubt, the provisions of statute will prevail and not the instructions. But, in the present case, there is not any inconsistency or any conflict as such. Therefore, it cannot be accepted that the instructions will not be applicable. The instructions deal with the situation in which the Department in its discretion may not launch the prosecution. This discretion has not been exercised properly by the authorities, therefore, complaint cannot be said to be properly filed. In the light of Modern Motor Works’ case (supra) [sic–here, the reference should have been to the case of Bee Gee Motors & Tractor’s case—Ed.] complaint was liable to be quashed.

7. The trial Court as well as appellate Court has not considered this important and vital aspect of the matter, therefore, they have failed in proper exercise of their jurisdiction. Therefore, impugned judgments deserve to be quashed. The default pertains to the asst. yr. 1985-86 and the prosecution was launched in the year 1987 and the matter is pending since 1999 in this Court only. The applicant is said to be above 62 years of age at the time of filing of this revision and presently he is said to be of about 70 years of age. Looking to the surrounding circumstances of the case, I do not find it proper to remit the case to initiate the proceedings afresh after exercising the discretion in the light of the circular issued by the authorities as it will serve no useful purpose. Following the Modern Motor Works’ case (sic) (supra) it will be just and proper to acquit the applicant, as the complaint itself would have been liable to be quashed.

8. Hence, this revision is allowed to the extent of quashing the conviction of the applicant under s. 276B of IT Act and he is acquitted of the charge under s. 276B of the IT Act. His bail bonds are discharged.

[Citation : 278 ITR 467]

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