Law:

Section:

Section 276B, read with section 194A of the Income-tax Act, 1961 - Offence and prosecution - Failure to pay tax deducted at source - Whether offence is complete on due date on which amount of tax should have been deposited but not deposited and late deposit will not absolve company and its officers from criminal charge - Held, yes FACTS The petitioner was Chairman of the company and filed return for the relevant assessment year for himself and on behalf of the company. In the process of assessment the ITO found that the petitioner had deducted the tax at source on interest but deposited the same after delay of 31 months. The proceedings under section 201(1) were initiated and interest at the rate of 12 per cent was charged. Prosecution under section 194A read with section 276B was instituted against the petitioner. The Chief Judicial Magistrate ordered the discharge of the petitioner and the company on the ground that from the complaint, the necessary ingredients of the offence had not been made out, since the assessee had deposited the tax along with the interest though the deposit was made late. On revision petition, the Sessions Judge set aside the order of the Chief Judicial Magistrate and remanded the case to him for further enquiry according to law. On writ : HELD Under section 194A read with rule 30 of the Income-tax Rules, 1962, the tax deducted at source has to be deposited within the stipulated period. It was not disputed that the deposit was made late. Since the offence was complete on the due date on which the amount should have been deposited but not deposited, the late deposit would not absolve the company and its officers from the criminal charge. If the petitioner could show some cause for this late deposit, that was a matter to be considered at the trial by the Magistrate. It was open to the income-tax authorities to impose penalty on the amount which had not been deposited. It was a different matter that the ITO felt satisfied by charging only interest on the late deposit. This fact, again would not absolve the petitioner of criminal liability. Note : The case was decided against the assessee. CASE REFERRED TO Sequoia Construction Co. (P.)…

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