Fourth Income Tax Officer, City Circle III vs A.K. Srinivasan

K.M. Natarajan, J.—These two appeals are directed by the offences under sections 193 and 196, Indian Penal Code, and for nor awarding

the minimum sentence as per law for the offence under sections 276C and 277 of the Income Tax Act, 1961, in E.O.C.C. No. 2222 of 1982 by

the Additional Chief Metropolitan Magistrate (Economic Offences II), Madras. The respondent in both the appeals, who is the accused in the

case, was prosecuted by the Income Tax Department under six charges - the first charge is u/s 420 read with section 511, Indian Penal Code; the

second charge is u/s 193, Indian Penal Code, read with section 136 of the Income Tax Act, 1961; the third charge is u/s 196, Indian Penal Code,

read with section 136 of the Income Tax Act, 1961; the fourth charge is u/s 276C of the Income Tax Act, 1961; the fifth charge is u/s 277 of the

Income Tax Act, 1961, and the sixth charge is also u/s 277 of the Income Tax Act, on the allegations that the accused has intentionally fabricated

his account books relating to the Income Tax assessment years 1976-77 and 1978-79 by deliberately suppressing the commission receipt of Rs.

1,05,000 from Messrs. Greaves Cotton and Co. Ltd. for the assessment year 1976-77 and falsely showing the same as income for the assessment

year 1978-79 with a view to defraud the exchequer of its legitimate revenue, and deliberately delivered false returns of income and statements of

accounts based on the abovesaid fabricated account books and thereby attempting to mislead the Income Tax officer and dishonestly inducing him

to deliver the assessment orders relating to the above assessment years, computing the total income at a considerably lower figure than that to

which he is properly assessable, and acting and relying on the aforesaid fabricated account books and false returns of income and statements for

the aforesaid Income Tax assessment years. It is further alleged that the accused had intentionally fabricated the account books for the Income Tax

assessment years 1976-77 (exhibits P-31, P-32 and P-33) and 1978-79 in the aforesaid manner with the intention of corruptly using them as

genuine evidence in the course of the Income Tax assessment proceedings relating to his case for the Income Tax assessment years 1976-77 and

1978-79 in the aforesaid manner with the intention of corruptly using them as a genuine evidence in the course of the Income Tax assessment

proceedings relating to his case for the Income Tax assessment years 1976-77 and 1978-79 and had wilfully attempted to evade tax, penalty and

interest chargeable or impossible within the meaning of section 276C of the Income Tax Act and, for the aforesaid purposes, have deliberately

delivered false returns of income (exhibits P-1 and P-25) and false statements of accounts (exhibits P-2 to P-5 and exhibits P-26 to P-28). In

support of the said charges, the prosecution examined P. Ws. 1 to 4, and marked exhibits P-1 to P-58, and, on behalf of the defence, one

Gurusami, Fourth Income Tax Officer, City Circle III, Madras-6, was examined as D.W. - 1 and exhibits D-1 to D-6 were marked.

The case of the complainant, the appellant herein, is that the respondent herein/accused is doing business in the name and style of Messrs.

Rajasekaran and Co., and he is an Income Tax assessee. For the year ended March 31, 1976, he filed the return of his income on July 14, 1978.

The balance-sheet and profit and loss account were also filed along with the return. In the balance-sheet, he has shown a sum of Rs. 2,53,498.92

as due to sundry creditors on the liabilities side. In the schedule to the balance-sheet for the sundry creditors, a sum of Rs. 1,05,000 was shown as

due to Messrs. Greaves Cotton and Co. Ltd., while actually it was an amount received as commission in June, 1975, and it was not an advance or

loan.

For the assessment years 1977-78 and 1978-79, the accused filed returns of income on July 31, 1978. In the return for the assessment year

1977-78, the accused disclosed a loss of Rs. 20,510. The schedule to the balance-sheet sent with the return showed the aforesaid amount of Rs.

1,05,000 as due to Messrs. Greaves Cotton and Co. Ltd. even as on March 31, 1977. The return for the assessment year 1978-79 disclosed a

total income of Rs. 2,068 based on the trading and profit and loss account for the year ended March 31, 1978. The aforesaid sum of Rs.

1,05,000 was shown as commission receipt in the trading and profit and loss account for the year ended March 31, 1978. In an enquiry by the

Department with Messrs. Greaves Cotton and Co. Ltd., it was revealed that Messrs. Rajasekaran and Company was actually paid a commission

of Rs. 1,05,000 in June, 1975, itself by cheque for the services rendered by them. Thus, it is clear that the accused, with a view to avoid payment

of lawful dues to the Government, intentionally fabricated his account books relating to the assessment years 1976-77 and 1978-79 by deliberately

suppressing the commission receipt of Rs. 1,05,000 from Messrs. Greaves Cotton and Co. Ltd., for the assessment year 1976-77, and falsely

showing it as if it was income for the assessment year 1978-79 with the intention to use them as genuine evidence in the course of the Income Tax

assessment proceedings. He has also wilfully attempted to evade tax, penalty and interest chargeable or impossible within the meaning of section

276C of the Income tax Act. Further, he has deliberately delivered false returns of income and false statements of accounts for the assessment

years 1976-77 and 1978-79. In addition, he has wilfully made false verification in the returns of income for those years. Hence the complaint.

Four witnesses were examined on the side of the complainant. P.W. - 1 is the Income Tax Officer. He has deposed in support of the allegations

stated in the complaint. Through him, the Income Tax return, exhibit P-1, received from the accused for the assessment year 1976-77, exhibit P-3,

the statement of accounts signed by Thiru G. Venkatesan, chartered accountant of Messrs. Venkatesh and Co., exhibit P-2, the trading and profit

and loss account for the year ended March 31, 1976, exhibit P-4, schedule to balance-sheet as on March 31, 1976, about sundry creditors and

sundry debts, exhibit P-5, statement of total income for the year ending March 31, 1976, and exhibit P-6, power of attorney in favour of Messrs.

Venkatesh and Co., were marked. According to him, for the year ended March 31, 1976, the total income was computed at Rs. 19,194 and a

sum of Rs. 1,05,000 was shown as due to Messrs. Greaves Cotton and Co. Ltd. in exhibit P-5. He then issued exhibit P-7 letter to Messrs.

Greaves Cotton and Co. Ltd. inquiring whether they have deposited the said amount with the accused-company on June 27, 1975, and to furnish

details of commission payments made by them. Summons u/s 131 of the Income Tax Act, namely, exhibits P-10, P-12 and P-15, were sent to the

Regional Account of the said company, and the replies received from Messrs. Greaves Cotton and Co. Ltd. were marked as exhibits P-8, P-9, P-

11, P-13 and P-17. The debit note dated June 26, 1975, exhibit P-18, sent by Thiru T.K. Vaidyanathan, Regional Accountant of Messrs.

Greaves Cotton and Co. Ltd., showed that the accused was paid a commission of Rs. 1,05,000 as final settlement for the services rendered by the

accused concern in canvassing for the sale of 50 marine engines to Kerala Fisheries Department and the said amount was paid by way of cheque.

The accused claimed that amount as brokerage and commission expenses in the profit and loss account for the accounting year 1974-75 relating to

Messrs. Greaves Cotton and Co. Ltd. Thereupon P.W. - 1 issued a letter, exhibit P-14, to the accused about the reply received from Messrs.

Greaves Cotton and Co. Ltd. The reply received from the accused is exhibit P-13 wherein he has requested that the amount need not be

considered for 1978-79 if it was treated as income for the assessment year 1976-77. After scrutiny of the returns of income and the statements of

accounts for the assessment years 1977-78 and 1978-79, it was found that this sum of Rs. 1,05,000 was shown as due to Messrs. Greaves

Cotton and Co. Ltd. in exhibit P-23 relating to the year 1978-79, P.W. - 1 issued summons to the accused and he produced account books,

exhibits P-31 to P-33, and two K. A.T. office files, exhibits P-34 and P-36, and they were impounded by an order, exhibit P-30, dated February,

21, 1979. According to him, at page 127 of exhibit P-31, ledger containing an account for Messrs. Greaves Cotton and Co. Ltd., there was an

entry for a receipt of Rs. 1,05,000 on June 27, 1975, by cheque No. 086581 on Grindlays bank without any narration to the effect that the same

was account. But there is no account for commission receipt. The correspondence between the accused-company and Messrs. Greaves Cotton

and Co. Ltd. were also filed. A sworn statement, exhibit P-45, was recorded from the accused on February 21, 1979, in which the accused has

clarified that he had no other business with Messrs. Greaves Cotton and Co. Ltd. excepting the commission of Rs. 1,05,000 and that the receipt of

the amount was shown as deposit and it was a mistake. He has further stated that to his draft order, exhibit P-47, the accused sent a letter, exhibit

P-48, in which no objections were raised for treating the sum of Rs. 1,05,000 as commission income for the assessment year 1976-77.

P.W. - 2, S.K. Kandasami, Income Tax Officer, deposed that he recorded sworn statements, exhibits P-50 and P-55, from P. W. 3, T. K.

Vaidyanathan, Regional Accountant of Messrs. Greaves cotton and Co. Ltd. P.W. - 3 deposed about his giving statements to P.W. - 2 and

production of documents. P.W. - 4, Assistant Director of Inspection and Investigation in the Income Tax Department, deposed that on September

25, 1979, he passed an assessment order for the assessment year 1976-77.

The accused was examined u/s 313, Criminal Procedure Code. he admitted the transaction between his company and Messrs. Greaves Cotton

and Co. Ltd. and the receipt of Rs. 1,05,000. He would further state that the returns were prepared by the auditor and he merely signed in a

routine way.

Thereupon, charges were framed and the accused pleaded not guilty to the charges. One witness was examined on the side of the accused.

D.W. - 1, S. Gurusami, is the Fourth Income Tax Officer, City Circle III, Madras, and it is his evidence that, in the original assessment order for

the year 1978-79, which was marked as exhibit D-4, a sum of Rs. 1,05,000 received by way of commission from Messrs. Greaves Cotton and

Co. Ltd. has been fully assessed to income Messrs. Greaves Cotton and Co. Ltd. has been fully assessed to Income Tax. The same amount was

taxed for the assessment year 1976-77. This amount was admitted in the return for the year 1978-79 even though it was received by the accused

during 1976-77. Because the accused disclosed this amount as income for the year 1978-79, it was assessed for that year.

The trial judge framed three points for consideration, namely :-

Whether the Income Tax Officer is a court within the meaning of section 195 of the code of Criminal Procedure ?

Whether the accused wilfully attempted to evade tax and has made a statement in the verification which is false and which he known to be false

?

Whether the accused has attempted to mislead the Income Tax Officer and dishonestly induced him to deliver the assessment orders computing

the total income at considerably lower figures than to which it is properly assessable ?

As regards the first point, the trial judge held that the Income Tax Officer is not a court within the meaning of section 195, Criminal Procedure

Code, and, consequently held that the complaint under sections 193 to 196 of the Indian Penal Code has to fail. As regards points Nos. 2 and 3,

the trial judge held that the charges u/s 276C and 277 of the Income Tax Act have been proved. He further held that the offence u/s 420 read with

section 511, Indian Penal Code, has also been established. While awarding the sentence, the trial judge observed that though the minimum

sentence prescribed under sections 276C and 277, Income Tax Act, is three months'' rigorous imprisonment, since the accused is an aged man

and the offence was committed in the year 1977 and he has not suppressed the income, but he has tried to show the income of Rs. 1,05,000

earned in 1975 as the income earned in 1978, thereby he has tried to evade tax, he felt that the minimum sentence prescribed under the Act is not

necessary in this case. Ultimately, he convicted the accused u/s 420 read with section 511, Indian Penal Code, and under sections 276C and 277,

Income Tax Act, and sentenced him to undergo imprisonment till the rising of the court and to pay a fine of Rs. 1,000 in default to suffer rigorous

imprisonment for three months u/s 420, read with section 511, Indian Penal Code, and also sentenced him to imprisonment till the rising of the

court and to pay a fine of Rs. 2000 in default to suffer rigorous imprisonment for three months u/s 276C, Income Tax Act, and also sentenced him

to suffer imprisonment till the rising of the court and to pay a fine of Rs. 1000 in default to suffer rigorous imprisonment for three months for the

offence u/s 277, Income Tax Act (two counts). The total fine was Rs. 5,000. The learned trial judge acquitted the accused of the charge u/s 193,

Indian Penal Code, read with section 136, Income Tax Act, and u/s 196, Indian Penal Code, read with section 136, Income Tax Act. Aggrieved

by the same, the two appeals were filed.

The learned Special Public Prosecutor for Income Tax Cases mainly submitted that the trial court ought to have seen that section 195, Criminal

Procedure code, cannot come into play in this case since section 195(b)(iii) has been complied with and a complaint by a public servant in writing

has been made. He has also submitted that section 136, Income Tax Act, has been amended by the Finance Act, 1985, with retrospective effect

from April 1, 1974. That has not been taken into consideration while deciding the issue with regard to the maintainability of the complaint in respect

of the offence u/s 193, Indian Penal Code. He would submit that though the lower court relied on the decision in Associated Industries and Others

Vs. First Income Tax Officer, City Circle-IV, Madras, , in that decision, the question of interpretation of sections 136 and 131 of the Income Tax

Act was not considered in the light of the decision of the Supreme Court in Lalji Haridas Vs. State of Maharashtra and Another, , and the

observations are purely obiter dicta and not ratio disdained. According to the learned Special Public Prosecutor, the lower court ought to have

followed the decision of the apex court in Balwant Singh and Another Vs. L.C. Bharupal, Income Tax Officer, New Delhi and Another, , which

has been followed by this court in Nagesh v. Panchapagesan [1975] MLJ (Crl.) 263 and M.R. Pratap Vs. V.M. Muthukrishnan, Income Tax

Officer, . In respect of awarding of sentence, it is submitted that the lower court has erred in awarding a lesser sentence, it is submitted that the

lower court has erred in awarding a lesser sentence, minimum of which has been mentioned under sections 276C and 277, Income Tax Act, and

the reasons given for such a lesser sentence are not correct and the same is not in accordance with law. He submitted that the lower court cannot

dilute the provisions of a statute prescribing a minimum sentence of three months and six months rigorous imprisonment to one of imprisonment till

the rising of the court on extraneous considerations. He submitted that the sentence imposed requires enhancement.

With regard to the acquittal of the accused in respect of the offences under sections 193 to 196, Indian Penal Code, the learned Special Public

Prosecutor for Income Tax Cases would submit that the finding of the learned trial judge that the Income Tax Officer is not a court within the

meaning of section 195(1)(b), Criminal Procedure Code, and as such his complaint under sections 193 to 196, Indian Penal Code, has to fail is

not sustainable as the trial magistrate relied on the decision in Associated Industries and Others Vs. First Income Tax Officer, City Circle-IV,

Madras, , rendered by a learned single judge of this court. he would submit that the question of interpretation of sections 136 and 131 of the

Income Tax Act, 1961, was not at all considered in the light of the decision of the Supreme Court in Lalji Haridas Vs. State of Maharashtra and

Another, , and the observations are purely obiter dicta and are not ratio decidendi. He would submit that the court below ought to have followed

the decisions in Nagesh v. Panchapagesan [1975] MLJ (Crl.) 263 and M.R. Pratap Vs. V.M. Muthukrishnan, Income Tax Officer, , which were

rendered following the decision of the Supreme Court in Balwant Singh and Another Vs. L.C. Bharupal, Income Tax Officer, New Delhi and

Another, . The learned Special Public Prosecutor for Income Tax Cases drew the attention of this court to the latest decision in Vinod Kumar Vs.

Income Tax Officer and Others, wherein it was held (headnote) :

Where a complaint is filed by the Income Tax Officer on the authorisation of the Commissioner of Income Tax who is a public servant, section

195(1)(a) of the Criminal Procedure code, 1973, is duly compiled with. So far as section 195(1)(b) of the Criminal Procedure Code, 1973, is

concerned, it is to be read with section 136 of the Income Tax Act, 1961, whereby any proceeding under the said Act before an Income Tax

authority shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228 and for the purposes of section 196 of the Indian

penal Code and every Income Tax authority shall be deemed to be a civil court for the purposes of section 195 of the Criminal Procedure Code.

The Income Tax Officer is a civil court as provided u/s 195(3) of the Criminal Procedure Code.

It has also been held (at page 87) :

Section 136 of the Act was amended by the Finance Act of 1985, with retrospective effect from April 1, 1974, and it applies to the present

case.

In the above-quoted case, the offences alleged were under sections 277 and 278 of the Income Tax Act, read with sections 193, 177 and 109

of the Indian Penal Code. The learned Special Public Prosecutor also drew the attention of this court to the decision in G.S.R. Krishnamurthi Vs.

M. Govindaswamy, Income Tax Officer, , wherein, in paragraphs 16 to 18, the question has been considered. The amendment of section 136 of

the Income Tax Act came into being by the Finance Act, 1985, with retrospective effect from April 1, 1974. The section as amended reads as

follows :

Any proceeding under this Act before an Income Tax authority shall be deemed to be a judicial proceeding within the meaning of section 193 and

228 and for the purposes of section 196 of the Indian Penal Code (45 of 1860), and every Income Tax authority shall be deemed to be a civil

court for the purposes of section 195, but not for the purposes of Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).

In the above-quoted decision, after referring to the amendment of section 136 of the Income Tax Act, it was observed (at pages 148 and 149)

:

On the face of the amended section, as extracted above, it goes without saying that a proceeding before the raiding authority shall be deemed to

be a judicial proceeding and such authority shall be deemed to be a civil court for the purposes of section 195 of the Code of Criminal Procedure

1973.

Even the question as to whether the procedural amendment can be made with retrospective effect had been considered by a learned judge of

this court in Union of India Vs. Gopal Engineering Works and Others, , wherein it was held that the retrospective amendment of a benevolent

provision could not be in violation of article 20(1) of the Constitution of India and, therefore, the amendment of section 136 with retrospective

effect from April 1, 1974, by the Finance Act, 1985, is valid. As such it cannot be stated that the first facet of the contention, a procedure before

the raiding authority before whom the petitioner was stated to have given a sworn statement, which is false to his knowledge can, by no stretch of

imagination, be stated to be a proceeding before a court, reflects the real position of law and, in this view of the matter, it has to fall to the ground.

This court has not held on the question that a proceeding before the Income Tax Officer is not a judicial proceeding and that the Income Tax

Officer is not a court consequent upon the amendment of section 136 of the Income Tax Act, which came into being by the Finance Act, 1985,

with retrospective fact from April 1, 1974. But all that is stated in the above-quoted case is that the complaint was launched other than by a raiding

authority, namely, the Income Tax Officer. It was contended that the said proceeding is not sustainable, and the court has held that a complaint

should have been preferred in writing by the raiding officer and n ot by the Income Tax Officer. However, the entirety of the prosecution shall not

stand vitiated and if at all only that part of the prosecution as was relatable to the offences falling within the ambit of section 195(1)(b)(i), Criminal

Procedure Code, would become invalid. We are not concerned with the conclusion arrived at with regard to facts. We are concerned only with

the principle laid down therein while interpreting the amendment of section 136 of the Income Tax Act to the facts of this case. In the instant case,

the complaint was launched by the proper person. The question is whether the proper Income Tax Officer is a court or not. While doing so, the

trial magistrate, without taking into consideration the amended provision of section 136 of the Income Tax Act, but relying on a decision rendered

by a learned single judge of this court, held that the Income Tax Officer is not a court and hence the complaint is not sustainable. In the face of the

amendment of the provisions of section 136 of the Income Tax Act by the Finance Act, 1985, with retrospective effect from April 1, 1974, the

finding of the trial magistrate that the Income Tax Officer is not a court, relying on the decision in Associated Industries and Others Vs. First

Income Tax Officer, City Circle-IV, Madras, , is not sustainable. As such, the acquittal of the accused of the offence under sections 193 to 196,

Indian Penal Code, on the ground that the complaint is not maintainable is liable to be set aside.

Next we have to consider the question whether the sentence awarded is in accordance with the provisions of the Act and is a proper and legal

one. The grievance of the appellant, namely, fourth Income Tax Officer, City Circle III, Madras-6, who is the complainant before the lower court

is that, in respect of the offence u/s 276C of the Income Tax Act, the accused has been sentenced to imprisonment till the rising of the court and to

pay a fine of Rs. 2,000 in default to suffer rigorous imprisonment for three months and similarly in respect of the offence u/s 277 of the Income Tax

Act (2 counts), he has been sentenced to undergo imprisonment till the rising of the court and to pay a fine of Rs. 1,000 in default to suffer rigorous

imprisonment for three months. He would submit that, in respect of those offences, the statute prescribed a minimum sentence of three months and

six months rigorous imprisonment respectively; but instead of imposing the minimum sentence prescribed under the statute, the Magistrate is not

justified in imposing the imprisonment till the rising of the court. Since it is not in accordance with the statute, it is illegal and improper and has to be

set aside. That a minimum sentence is prescribed under those sections of the Income Tax Act, which is a special statute, is not in dispute. It is seen

from the judgment that the trial magistrate has observed that the accused is an old man, that the offence was committed in 1977, that the accused

has not suppressed the income, but he has tried to show the income of Rs. 1,05,000 earned in 1975 as the income earned in 1978, and thereby he

has tried to evade tax. Hence the trial court felt that the minimum sentence prescribed under the Act is not necessary. This court finds that though

reasons are given by the trial magistrate, there is no provision in the statute giving discretion to the court to give a sentence less than the minimum

sentence prescribed under the Act as any other Act. The trial magistrate is not justified in not imposing the minimum sentence, but only imposing

the sentence of imprisonment till the rising of the court and a fine as it is sentence of imprisonment till the rising of the court and a fine as it is not a

proper and correct sentence as per the statute. However, this court feels that the offence in question is alleged to have taken place in the year

1976-77. The conviction by the learned trial magistrate was imposed in 1984 and more than ten years have elapsed from the date of commission

of the offence and nine years have elapsed from the date of judgment rendered by the Magistrate. At this length of time, it will not be proper to

order re-trial in respect of the offence as the accused was acquitted on the ground that the complaint is not maintainable, and as the accused was

not awarded the minimum sentence of imprisonment. Admittedly, the accused has already paid the fine imposed and served the sentence awarded

by the trial court. In this connection, with regard to the nature of the order to be passed, some decisions of the apex court and this court are relied

on. It was also brought to the notice of this court that the appeal for enhancement of sentence has been filed only by the Income Tax Officer and

not by the Central Government and the officer is not competent to file the appeal for enhancement of sentence. In Asst. Collector of Central Excise

(Preventive) v. V. Krishnamurthy [1983] LW (Crl.) 196; [1984] 1 ECC 17, a Division bench of this court held :

The Customs Officer under the Customs Act (52 of 1962) or the Assistant Collector of Central Excise under the gold (Control) Act (45 of 1968)

is not an agency empowered to make ''investigation'' within the meaning of that expression as used in section 377(2) of the Criminal Procedure

Code. Hence the appeal u/s 377(2) for enhancement of sentence imposed for offence under those Acts, at the instance of such officer, would not

be maintainable. (Asst. Collector of Central Excise v. R. Padmanabhan [1980] ELT 631 (Mad)), approved.

The attention of this court was also drawn to the decision of the apex court in Eknath Shankarrao Mukkawar Vs. State of Maharashtra, ,

wherein it was held (at page 1180 of AIR 1977 SC) :

By section 3 of the Delhi Special police Establishment Act, the Central Government may by notification in the Official Gazette specify the offences

or class of offences which are to be investigated by the Delhi Special Police Establishment. It is only when such a notification is made by the

Central Government that the Delhi Special Police Establishment is empowered to investigate the specified offences. Similarly, if in any other Central

Act, not being the Code of Criminal procedure, a provision is made for empowering a particular agency to make investigation of offences under

that Act, then also the Central government alone will be the competent authority to prefer appeal u/s 377(2), Criminal Procedure Code. The true

test, therefore, u/s 377(2), Criminal Procedure Code, is whether the offence is investigated by the Delhi Special Police Establishment or is

investigated by any other agency empowered to make investigation under any Central Act other than the code of Criminal Procedure. In other

words, just like section 3 of the Delhi Special police Establishment Act, there should be an express provision in the prevention of Food

Adulteration Act empowering the making of investigation under the Act. But no such express provision is found in the Prevention of Food

Adulteration Act...... In the absence of such a provision it is not possible to hold that the Food Inspectors are empowered to make investigation

under the Act. Section 377(2), Criminal Procedure Code, is, therefore, not attracted to offences under the Prevention of food Adulteration Act

and the appeal u/s 377(1), Criminal Procedure Code, at the instance of the State Government is maintainable."" (Paragraphs 11, 13).

Applying the ratio in the above-quoted decisions to the facts of this case, since the appeal for enhancement of sentence u/s 377, Criminal

Procedure Code, is not filed by the State or the Central Government and the Income Tax Officer, who is the appellant herein, is not the agency to

make investigation within the meaning of the expression as used in section 377(2), Criminal Procedure Code, the appeal for enhancement of

sentence is not maintainable on the ground alone. In the other appeal, the relief asked for is in respect of acquittal of the respondent of certain

offences on the ground that the complaint is not maintainable. Learned counsel for the respondent drew the attention of this court to the decision in

State of Tamil Nadu Vs. R. Krishnamurthy, . In the above-quoted case, the apex court came to the conclusion that the offence has been made out

under the Prevention of food Adulteration Act where also minimum sentence of imprisonment was prescribed in respect of sale of gingelly oil

mixed with groundnut oil which is found adulterated. In the appeal against the order of acquittal filed by the State of Tamil Nadu, the apex court

observed as follows State of Tamil Nadu Vs. R. Krishnamurthy, :

We are, therefore, of the opinion that the sale of gingelly oil mixed with groundnut oil is punishable u/s 16(1)(a)(i) read with section 2(1)(a)

notwithstanding the fact that the seller had expressly stated at the time of sale that it was intended for external use only. We declare the legal

position as indicated in the earlier paragraphs but we refrain from passing any further order in the appeal which we accordingly dismiss.

The decision in Skandia Insurance Co. Ltd v. Kokilaben Chandravadan and Ors. , (1987) 2 SCC 645 , was also cited before this court. That

was also a case under the Prevention of Food Adulteration Act, where the accused was liable for minimum sentence of six months rigorous

imprisonment. The High Court convicted the accused reversing the order of acquittal and sentenced him to rigorous imprisonment for six months

and a fine of Rs. 1,000. On appeal while confirming the conviction, the apex court observed (at page 646) :

....... it was contended that the appellant had already deposited the amount of the fine and also been in jail for some time during this period and

ultimately the matter has come up for hearing more than about 15 years after the sample was taken and in this view of the matter no useful purpose

will be served by sending him to jail for serving out a short-term of imprisonment which remained unserved.... In view of these circumstances in our

opinion the sentence undergone will meet the ends of justice. The appeal is partly allowed, conviction of the appellant u/s 7(1) read with section

16(1)(a) of the Prevention of Food Adulteration Act is maintained and he is sentenced to the sentence already undergone and a fine of Rs. 1,000.

In State by Food Inspector, Kadaiyanallur Municipality v. Syed [1991] L.W. (Crl.) 63, this court observed as follows :

Now that it has been held that the acquittal of the respondent in each one of these appeals cannot be sustained, the manner of dealing with the

respondents has to be scrutinised. The milk sampling was done in 1983 and nearly seven years have elapsed. The acquittal of the respondent in

each one of these appeals was recorded on June 6, 1985. Therefore, I am reluctant to interfere with the order of acquittal. Having made the

position of the law clear, I decline to set aside the order of acquittal. Subject to the above observation, these appeals shall stand dismissed.

Inn COMMISSIONER OF Income Tax Vs. RAM RUP KISHAN AND OTHERS., , it has been held (headnote) :

In the present case, it was proved that the error in question was not an intentional one and that it was on account of a bona fide mistake. At any

rate, there was a good deal of doubt on this point and the benefit of doubt had to go to the accused. Moreover, there was delay of 20 years from

the date of occurrence and more than 10 years from the date of the judgment of acquittal. There was no room to disturb the order of acquittal.

In the said case, it was pointed out (at page 133) :

In S. Guin and Others Vs. Grindlays Bank Ltd., , their Lordships of the Supreme Court observed that inordinate delay of nearly six years that had

ensued after the judgment of acquittal would justify the termination of the criminal proceedings. In the present case, the delay is of twenty years

from the date of occurrence and more than ten years from the date of the judgment of acquittal.

In Banwari and Others Vs. Income Tax Officer and Another, , the facts are that the appellants were carrying on business in manufacture of

bidis in partnership. The firm had ceased to do business with effect from December 31, 1972. But, in their returns filed on August 16, 1973, the

date of cessation was given as December 31, 1969. The mistake was noticed on August 17, 1974, and it was corrected on August 26, 1974. In

1977, the Income Tax Officer filed complaints against the appellants that false statement had been made in the verification which was punishable

u/s 277 of the Income Tax Act, 1961, and section 420 of the Indian Penal Code. After perusing the averments in the complaint and supporting

documents, the Magistrate came to the conclusion that the mention of December 31, 1972, as the date of cessation was a bona fide mistake and

directed discharge of the accused. In revision, the High Court set aside the order of discharge on the ground that the Magistrate could not order

discharge of the accused without recording evidence. The appellants preferred appeals to the Supreme Court on certificates granted by the High

Court, and the Supreme Court admitted the appeals and granted stay of further proceedings. The Supreme Court held (headnote) :

For more than a decade, the proceedings were pending in the trial court and no useful purpose would be served by proceeding with the complaint

after the lapse of such a long time; the matter had become stale.

It was also held (headnote) :

On the facts, the Magistrate could not be said to have been grossly wrong in inferring that the mention of the wrong date was merely a bona fide

mistake.

Consequently, the Supreme Court set aside the order of the High Court and restored the order of discharge passed by the Magistrate.

Applying the ratio in the above-quoted decisions to the facts of this case, it is seen that the offence is said to have been committed in the year

1976-77 and the order of acquittal was passed in 1984, and no useful purpose would be served by ordered re-trial at this length of time especially

when the respondent has already undergone imprisonment till the rising of the court and paid the fine in respect of the offences committed in

connection with the same transaction. Hence this court feels that this is not a fit case for ordering re-trial with regard to these offences. For the

reasons stated above, both the appeals are dismissed.