Law: Income Tax Act, 1961

Section: 276,277

Income Tax----Offences and prosecution---Deliberate attempt to evade tax---False verification---Findings of fact by Tribunal are binding on the criminal Court---Finding in penalty proceedings that there was a genuine mistake in accounting---Prosecution liable to be quashed---Indian Income Tax Act, 1961, Ss.276-C & 277---Indian Criminal Procedure Code, 1973, S.482. The findings of the Tribunal on the facts are final and the High Court has no jurisdiction to go behind the statements of fact made by the Tribunal. Therefore, the criminal Court is bound to accept the findings of the Tribunal, on questions of fact. When the Tribunal in the penalty proceedings gives a finding against the assessee, who is facing criminal prosecution, he cannot be convicted on the basis of the findings of the Tribunal because the criminal Court has to follow the procedural law for trying an offender according to the Criminal Procedure Code, 1973, and, therefore, the High Court cannot deviate from the Code for the reason that finding has been arrived at by the authorities under the Income Tax Act, 1961. But the facts found by the Tribunal in favour of the assessee cannot be disturbed by the High Court as the Tribunal is the fact-finding authority. A complaint was filed against a firm and its partners under sections 276-C and 277 of the Income Tax Act, 1961. The accused explained that the accountant had died suddenly and, therefore, they found it difficult to finalise their accounts and the son of the previous accountant had taken over the post of accountant, that with little experience he prepared the accounts for the submission of the returns, that, therefore, mistakes had occurred in the totaling of the purchases from A and on account of this mistake the discrepancy had occurred. They stated that when this mistake was found out later in 1989, they had filed the revised returns for 1986-87, 1987-88 and 1988-89 voluntarily disclosing the correct income and, therefore, there was no intention to conceal their income. The Tribunal had quashed the penalty proceedings accepting the contention of the petitioners that the discrepancy in the income was a bona fide mistake. On a petition to…

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