High Court Of Madras
Smt. Jayapradha vs. CCIT & ANR.
Section 1998FA(No. 2) 95(i)(a)
Asst. Years 1980-81, 1981-82, 1982-83, 1983-84, 1984-85
N. Dhinakar, ACTG. C.J. & F.M. Ibrahim Kalifulla, J.
Writ Appeal No. 523 of 2003
7th November, 2005
Counsel Appeared
Ravichandran for Satish Parasaran, for the Appellant : T. Ravikumar, for the Respondents
JUDGMENT
F.M. Ibrahim Kalifulla, J. :
The appellant is aggrieved against the order of the learned single Judge dt. 24th Aug., 2000 made in WP No.14234 of 2000 in and by which, the learned Judge declined to interfere with the order of the second respondent herein dt. 23rd Feb., 1999. The sum and substance of the grievance of the appellant was that she was entitled to the benefits of Kar Vivad Samadhan Scheme, 1998 (in short ‘the Scheme’) and that her application to derive the benefitsunder the said Scheme was rejected by the second respondent by the order dt. 23rd Feb., 1999.
2. Paragraph 95(i)(a) of the said Scheme reads as under : “95. Scheme not to apply in certain cases.—The provisions of this Scheme shall not apply— (a) in a case where prosecution for concealment has been instituted on or before the date of filing of the declaration under s. 88 under any direct-tax enactment in respect of any assessment year, to any tax arrear in respect of such assessment year under such direct tax enactment or in respect of a person who has been convicted for concealment on or before the date of filing the declaration;” (emphasis, italicised in print, supplied) A reading of the above paragraph makes it clear that in respect of a case where prosecution for concealment has been ‘instituted’ on or before the date of filing of the declaration under s. 88 under any direct-tax enactment in respect of any assessment year, the concerned assessee would not be entitled to the benefits of the said Scheme. It was on that basis, the appellant was issued with the notice dt. 17th Feb., 1999 calling upon her to give a reply in writing on or before 25th Feb., 1999. The appellant came forward with a reply through her chartered accountant on 23rd Feb., 1999 wherein it was merely stated that with reference to the notice dt. 17th Feb., 1999 a writ petition has been admitted in this Court. In such circumstances, the second respondent proceeded to pass the order impugned in the writ petition dt. 23rd Feb., 1999 holding that by virtue of the exclusion clause contained in the Scheme the appellant’s application under the Scheme has to be rejected.
When the appellant challenged the said proceedings in this Court, the learned single Judge took note of the fact that even though the writ petitioner/appellant compounded the prosecution, the same was accepted only for the asst. yr. 1980-81 to 1984-85. The learned Judge further held that inasmuch as prosecution had already been initiated against the appellant long before the filing of the declaration under s. 88, her application came to be rightly rejected. The only other point raised before the learned Judge was that the refusal of the appellant’s offer for compounding the offence for the asst. yr. 1985-86 was the subject-matter of challenge in the Court. As far as the said contention was concerned, the learned Judge found that such challenge by itself would not wipe off the factum of initiation of the prosecution. No other contention was raised before the learned single Judge. Mr. Ravichandran, learned counsel for the appellant contended before us that having regard to the compounding of the offence for the earlier assessment years, viz. 1980-81 to 1984-85, the very initiation of the prosecution would lose its validity and, therefore, it should be taken that there was no initiation of proceedings at all and on that basis, the second respondent ought to have accepted the appellant’s application to derive the benefits under the Scheme. Learned counsel then contended that though in the notice dt. 17th Feb., 1999, a date for personal hearing was fixed, i.e., 25th Feb., 1999 at 11.30 a.m., the impugned order came to be passed two days earlier and that itself would vitiate the order of the second respondent. Mr. T. Ravikumar, learned standing counsel for the Department would point out that the Scheme was effective only for a period of three months (i.e.) between 1st Oct., 1998 and 31st Dec., 1998 and, therefore, during the said period, by applying para 95(i)(a) of the Scheme, if any criminal prosecution had already been initiated prior to the filing of the declaration under s. 88, the appellant would be disentitled to claim any benefit under the Scheme. Learned counsel relied upon the decision of the Hon’ble Supreme Court in Hemalatha Gargya vs. CIT & Anr. (2003) 182 CTR (SC) 107 : (2003) 259 ITR 1 (SC).
Having heard the learned counsel for the respective parties, we are in full agreement with the learned standing counsel for the respondent. On a perusal of the relevant expressions used in para 95(i)(a) of the Scheme, we are satisfied that the initiation of the prosecution on or before the date of the filing of the declaration under s. 88 was sufficient in order to decide as to whether an assessee was entitled for deriving any benefit under the Scheme. As far as the initiation of the prosecution as regards the asst. yrs. 1980-81 to 1984-85, there is no dispute. In fact, learned standing counsel for the Department submitted before us that the criminal case was pending in CC No. 816 of 1993 on the file of the Asstt. Chief Metropolitan Magistrate (Economic Offences Court-I) Chennai. In such circumstances, when the appellant applied for the benefits under the said Scheme and when it was beyond controversy that the criminal prosecution had already been initiated in respect of the relevant assessment years, the second respondent was fully justified in refusing to accept the appellant’s application claiming benefits under the abovereferred to Scheme. The Hon’ble Supreme Court has made it clear in the judgment in Hemalatha Gargya case (supra), at p. 7 by stating : “Besides, the Scheme has conferred a benefit on those who had not disclosed their income earlier by affording them protection against the possible legal consequences of such non-disclosure under the provisions of the IT Act. Where the assessees seeks to claim the benefit under the statutory Scheme they are bound to comply strictly with the conditions under which the benefit is granted. There is no scope for the application of any equitable consideration when the statutory provisions of the Scheme are stated in such plain language.”
Therefore, when the appellant wanted to derive the benefits under the Scheme, it is the bounden duty of the appellant to satisfy the norms within which she could claim the benefits. Therefore, when admittedly the prosecution was initiated long prior to the coming into force of the Scheme itself and were pending as on the date when the operation of the Scheme was in vogue, it is too late in the day for the appellant to contend that irrespective of the said position, the appellant’s application under the Scheme should have been entertained on the basis of compounding of such offence. Therefore, we are unable to appreciate the said contention so raised on behalf of the appellant, which was rightly rejected by the learned single Judge. As far as the last contention that the appellant was given the opportunity to appear before the second respondent at 11.30 a.m. on 25th Feb., 1999 but the second respondent had passed the order even two days prior to the said date is concerned, we do not find any such contention having been raised before the learned single Judge in order to consider the said contention. Therefore, the appellant cannot now be permitted to raise the said contention before us. In any event, the appellant having sent her reply on 23rd Feb., 1999, that made her intentions clear to the effect that she was not prepared to avail the personal hearing. Therefore, we do not find any ground to interfere with the order of the learned single Judge nor with the order of the second respondent. The writ appeal, therefore, fails and the same is dismissed. Connected WAMP No. 673 of 2003 is closed. It is a clear case of abuse of process of Court. We, therefore, impose a cost of Rs. 25,000 payable within two weeks from today to the Tamil Nadu Legal Services Authority, Chennai.
[Citation : 284 ITR 385]
