Rajinder Kumar v. State. (2023) 451 ITR 338 (Delhi)(HC)

S. 276C : Offences and prosecutions-Wilful attempt to evade tax-Failure to produce accounts and documents-Admission regarding Foreign Bank account after an investigation by department-Revised return was filed after issue of notice-Failure to disclose foreign account opened in year 1991 when the assessee was 55 years of age-Cannot take benefit of circular recommending any prosecution where the assessee is aged 70 years or more at time of offence-Launching of prosecution is justified. [S. 132, 153A, 271, 271(1)(b), 274, 276C(1), 276D, 277, Code of Criminal Procedure, 1973, S. 245(2), Central Board Of Direct Taxes Instruction No. 5051, Dated 7-2-1991]

In the year 2011 based on information received from France that the assessee had opened an account in a bank in London on August 20, 1991 a search and seizure was conducted under section 132 of the Income-tax Act, 1961 at various business premises and residence of the assessee on August 23, 2011. A notice under section 153A was issued to the assessee to file a return. Penalty was levied for failure to comply with notices issued under section 142(1). The assessee filed a revised return for the assessment year 2006-07 declaring the balance in the bank account in London as income from other sources on the basis of details provided at the time of search and assessment proceedings. A notice under section 277 read with section 279(1) was issued and the assessee furnished details of payment of entire taxes, penalties and interest. Thereafter, criminal complaints under sections 276C(1)(ii) and 277 were filed against the assessee. The assessee filed an application under section 245(2) of the Code of Criminal Procedure, 1973 for discharge on the ground that he was eighty years old citing Instruction No. 5051 dated February 7, 1991 issued by the Central Board of Direct Taxes. Dismissing the petition, the Court held that the assessee could not take benefit of Instruction No. 5051 dated February 7, 1991. He had opened the account in the bank in London on August 20, 1991 and it was only after the Government of France brought to the knowledge of the competent authorities that the assessee disclosed it in the year 2011. During the period relevant to the assessment year 2006-07 the assessee allegedly had the maximum credit balance in his foreign bank account. The foreign account was opened in the bank in London on August 20, 1991 and was not disclosed. Taking the date of birth of the assessee, as claimed by him, as March 30, 1936, at the time of commission of offence in the year 1991 he was 55 years of age. Instruction No. 5051 dated February 7, 1991 stated that prosecution normally be not initiated against a person who has attained the age of 70 years at the time of commission of offence. Therefore, in terms of Instruction No. 5051 dated February 7, 1991, the age of the assessee had to be taken at the time of commission of offence and not when the proceedings were initiated. It was only after the notice under section 274 read with section 271 of the Act was issued and penalty under section 271(1)(b) of the Act for failure to comply with notice under section 142(1) of the Act was also levied on September 26, 2013 that the assessee had chosen to file a revised return on February 16, 2015. By doing so he could not evade the judicial process of law for not disclosing his correct income and foreign account since the year 1991.(AY.2006-07)

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