Union of India and Another vs M/s Engineers Cement and Alies and Others

R.B. Dixit, J.

The learned trial Court by the impugned order has acquitted the respondents of the charge u/s 276-DD and 278(B) of the Income Tax Act, on the ground that the offence relates to the violation of the provisions envisaged u/s 269-SS of the Income Tax Act. However, the provisions contained under Sec. 269-SS of the Income Tax Act had since been deleted by amending Act, which come into force from 1.4.1989. The learned counsel of the appellant submits that the provisions of Sec. 269-SS were not deleted by amendment at the time of commission of the offence and therefore, the prosecution cannot be dropped on the ground. Reliance is placed on a decision of the Apex Court case of M/s. P.V. Mohammad Barmay Sons Vs. Director of Enforcement, . This is a case under foreign exchange Regulations Act and the controversy involved was about penalty incurred under repealed Act, which is not the case here.

It is not disputed that the prosecution in the present case was launched after amendment in the Income Tax Act came into force. It has been held in a decision of A.P. High Court in case of Assistant Commissioner of Income Tax Vs. Viyaya Finance & others, reported in (1998) 146 Taxation 353 (A.P.) that the prosecution could be continued inspite of deletion of Sec. 269-DD, if prosecution is launched after coming into force of the amending Act. In a decision of this Court in case of Harikishan & others vs. Union of India, reported in 48 R. 630 TAX Compendium. It has been held that the petitioners cannot be deprived of benefit of amendment and therefore, the proceedings against them were quashed.

Taking into consideration the facts and circumstances of the case and the impact of law as changed by amending Act, this petition is devoid of merits and is accordingly dismissed.