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Section 277 of the Income-tax Act, 1961 - Offences and prosecutions - False statement in verification - Whether prosecution launched against petitioner under section 277 on strength of ITO's order imposing penalty is maintainable, even if penalty order is quashed by appellate authority - Held, no Facts The ITO imposed penalty on the petitioner and on that basis launched criminal prosecution against him under section 277. The penalty was subsequently quashed by the appellate authority. The petitioner therefore contended before the trial Magistrate that when the case of the department for imposition of penalty had faltered, there was no case to proceed against him criminally. The Magistrate, however, dismissed the petitioner's prayer to quash the complaint. On petition under section 482 of the Code of Criminal Procedure: Held The Supreme Court in the case of Uttam Chand v. ITO [7952] 133 ITR 909 has pronounced that if there is no case for sustenance of penalty, there is equally no case for criminal prosecution. Accordingly, the claim of the petitioner was well founded. The complaint and the proceedings taken thereon were, accordingly, quashed. Case review Uttam Chand v. ITO [1982] 133 ITR 909 (SC) followed. Cases referred to Uttam Chand v. ITO [1982] 133 ITR 909 (SC) and Parkash Chand v. ITO [1982] 134 ITR 8 (Punj. & Har.). Judgment 1. This is a petition under section 482 of the Code of Criminal Procedure for quashing the criminal complaint filed by the ITO, Kurukshetra, against the petitioner. 2. Skeletal facts arising thereto are these: Occasion had arisen during assessment proceedings to initiate imposition of penalty on the petitioner. The officer of the first instance imposed penalty on the petitioner. Later that order was quashed by the appellate authority. On the strength of the order of the officer of…

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