1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY BENCH AT NAGPUR, NAGPUR. ... CRIMINAL REVISION APPLICATION NO.132/1998 WITH CRIMINAL REVISION APPLICATION NO. 142/ 1996 WITH CRIMINAL REVISION APPLCIATION NO.143/1996 WITH CRIMINAL REVISION APPLICATION NO: 144/1996 WITH CRIMINAL REVISION APPLICATION NO. 168/1996 WITH CRIMINAL REVISION APPLICATION NO. 169/1996 1) CRI.REVN.APPLICATION NO. 132/1998: Income Tax Officer Shri Ramesh Bhoskarwar “Aayakar Bhawan” Telangkhedi Road, Nagpur. ..APPLICANT v e r s u s 1) Nandlal & co. A partnership firm through ItsPartner Shri Kishore s/o Jivraj Patel 2) Kishore s/o Jivraj Patel Aged about 32 years 3) Chimanlal s/o Jivraj Patel Aged about 28 years 4) Smt. Dekshaben w/o Mohanlal Patel, Aged about 27 years 5) Lakhanbhai Bhimaji Patel Aged about 31 years All C/o M/s Nandlal & co. 2 A pasrtnrhsip firm, Bhandara Road, Lakadganj Nagpur. ..RESPONDENTS ............................................................................................................................ Mr. Anand Parchure, Advocate for applicants Mr S N Bhattad, Adv.for respondents ….................................................................................................................... 2) CRI.REVN.APPLICATION NO. 142/1996: Income Tax Officer on Ward No. 1(2) “Aayakar Bhawan” Telangkhedi Road, Nagpur. ..APPLICANT v e r s u s Vishram s/o Lekhraj Magnani Aged about 40 years proprietor M/s Jagdish Trading Company Old Resham Oli, Nagpur ..RESPONDENT ............................................................................................................................ Mr. Anand Parchure, Advocate for applicants Mr S.N.Chinchbawkar Adv.h/for C J Thakar Adv.for respondent ….................................................................................................................... 3) CRI.REVN.APPLICATION NO. 143/1996: Income Tax Officer on Ward No.1(2) “Aayakar Bhawan” Telangkhedi Road, Nagpur. ..APPLICANT v e r s u s Vishram s/o Lekhraj Magnani Aged about 40 yearsProprietor 3 M/s Jagdish Trading Company Old Reshma Oli Nagpur 440 002. ..RESPONDENT ............................................................................................................................ Mr Anand Parchure, Adv.for applicant Mr. S N Chinchbawkar, Adv.h/for Mr C.J.Thakar Adv.for respondent ….................................................................................................................... 4) CRI.REVN.APPLICATION NO. 144/1996: Income Tax Officer on Ward No.1(2) “Aayakar Bhawan” Telangkhedi Road, Nagpur. ..APPLICANT v e r s u s Vishram s/o Lekhraj Magnani Aged about 40 years Proprietor M/s Jagdish Trading Company Old Reshma Oli Nagpur 440 002. ..RESPONDENT ............................................................................................................................ Mr Anand Parchure, Adv.for applicant Mr. S N Chinchbawkar, Adv.h/for Mr C.J.Thakar Adv.for respondent ….................................................................................................................... 5) CRI.REVN.APPLICATION NO. 168/1996: 2nd Income Tax Officer (Assessment) “Aayakar Bhawan” Civil Lines , Nagpur. ..APPLICANT v e r s u s Ajayprakash s/o Murlidhar Kanoria Aged about 40 years, Resident of Kanoria Bhawan, Ghat Road, Nagpur. ..RESPONDENT 4 ............................................................................................................................ Mr Anand Parchure, Adv.for applicant Mr. V V Bhangde, Adv.for respondent ….................................................................................................................... 6) CRIMINAL REVISION APPLICATION NO. 169/1996 The Income Tax Officer Income Tax officers' Circle Voltas Building Sadar, Nagpur. . ..APPLICANT v e r s u s 1) M/s Veer Radios A partnership firm, doing business in Radios, Amplifiers and other electrical goods, having the place of business at Sitabuldi Main Road, Nagpur. 2) Birsen s/o Nanakchand Ahuja Aged about 64 years, occu: Business R/o 19, Byramji Town, nagpur 3) Sanjiv s/o Birsen Ahuja Aged about 38 years, occu: business R/o 19, Byramji Town, Nagpur. ..RESPONDENTS ............................................................................................................................ Mr Anand Parchure, Adv.for applicant Mr. B.G. Kulkarni, Adv.for respondents ….................................................................................................................... CORAM: A.P.BHANGALE , J. DATED: 5 th December, 2011 ORAL JUDGMENT : 5 1. As common question of law arises for consideration in the above-referred matters, they are being disposed by this common judgment and order. (The facts are taken from Cri .Revision Application No. 132/1998). 2. By this revision application, the revision-applicant prayed for to quash and set aside the judgment and order dated 27.1.1998 passed by learned 2nd Additional Sessions Judge, Nagpur in Criminal Misc. Cri. Revision Application No. 823/ 1997. 3. It is the case of the revision-applicant that as an Income Tax officer a criminal Complaint No. 138/1992 was filed by the applicant alleging offences punishable under sections 276C and 227 of the Income Tax Act, 1961 in the Court of Chief Judicial Magistrate, Nagpur. In that proceeding, the non-applicant had moved an application for discharge on the ground that Income Tax Appellate Tribunal ( in short “ITAT” ) had set aside the penalty and, therefore, prosecution could not be sustainable. The trial Court had rejected the application filed by the non-applicant, therefore, the Revision Application was filed before the learned Sessions Judge,Nagpur. By judgment and order dated 27.1.1998 the learned 2nd Additional 6 Sessions Judge, Nagpur allowed the Revision of the non-applicant and discharged them. 4. At the hearing of this application, it is submitted as regards the allegation of concealment of income, that penalty proceedings initiated under section 271 (1)(c) of the Income Tax Act was started by the Department which was quashed by the ITAT. In that matter, the Department had filed reference against the order of the ITIAT which was admitted on the basis of some allegations of alleged concealment of income. My attention has been invited to rulings of the Apex Court in the case of G D Didwania and another vs. Income Tax officer and another reported in 1995 Suppl. ( 2) SCC page 724. The Apex Court considered the question as to whether the appellant in that case made a false statement regarding the income which according to the assessing authority had escaped the assessment. It was held that on this issue the finding of the Appellate Tribunal was conclusive and, therefore, the prosecution cannot be sustained. Accordingly, it was concluded that the criminal proceedings were liable to be quashed. It is, therefore, submitted that the question as to whether the prosecution can be sustained in view of the order passed by the Tribunal is answered by the Apex Court to the effect that once the finding of the Assessing 7 Authority that assessee made a false statement is set aside by the ITAT, the criminal proceedings would not be sustainable because the finding of the ITAT is conclusive. Earlier also, in the ruling in K C Builders and another vs. Assistant Commissioner of Income Tax reported in 289 ITR 83 (SC), on the identical issue the Apex Court had observed that before penalty under section 271 (1)(iii) may be imposed it has to be proved that the assessee has consciously made the concealment or furnished inaccurate particulars of income. The ruling concluded that it is an established principle that the matter which has been adjudicated and settled by the Tribunal need not be dragged into criminal courts unless and until the act of the appellant could have been described as culpable. In another ruling in H.T. Power Structure Pvt.Ltd. vs. R.P .Sharma and another ( 2008) 299 ITR 363 (Guj) it appears concluded that when penalty has been set aside by the Income Tax Appellate Tribunal the finding becomes conclusive and the prosecution would not be sustainable and is liable to be quashed and set aside. 5. Looking to the aforesaid rulings cited and legal position, I do not see any merit in the Revisions. All Revision Applications are therefore dismissed. JUDGE Sahare