ANANTRAI JOSHI and CO. and Others vs Commissioner of Income Tax and Others

N.N. Mathur, J.

This special appeal is directed against the judgment of the learned Single Judge dated 14-12-1994 whereby the learned Single Judge dismissed the writ petition in limine.

Briefly stated the facts of the case are that the appellant original petitioner No. 1 M/s Anantrai Joshi & Co. is a partnership-firm. The said firm did not file its return of Income Tax for the assessment year 1982-83, which was due to be filed on or before 30-6-1982, as required by the provisions of section 139(1) of the Income Tax Act. The return was filed on 20-6-1983, declaring its income at Rs. 93,327.65. No explanation was given by the assessee for the late filing of the return. The assessment was made and a demand notice for depositing a sum of Rs. 13,307 was issued. It is alleged that as the appellant- assessee failed to file the return within the stipulated period under the provisions of sub-section (1) of section 139 of the Income Tax Act it was liable to be prosecuted for offence u/s 276CC read with section 278B of the Income Tax Act.

It is not in dispute that Deputy Commissioner, Jodhpur has deleted the penalty for the assessment year 1984-85 by order dated 18-3-1994. It is submitted by the learned counsel that the provisions of sections 139(1) and 139(2) have been omitted and as such the prosecution cannot further continue. He has placed reliance on a decision of the Apex Court in General Finance Co. and Another Vs. Assistant Commissioner of Income Tax, Punjab,

Section 271 deals with consequential failure to furnish returns, comply with notices and concealment of income, etc. Sub-clause (1)(a) as it stood prior to 1989 is extracted as follows :

"(a) has failed to furnish the return of total income which he was required to furnish under sub-section (1) of section 139 or by notice given under sub-section (2) of section 139 or section 148 or has failed to furnish it within the time allowed and in the manner required by sub-section (1) of section 139 or by such notice as the case may be, or"

The Direct Tax Laws (Amendment) Act, 1989, omitted the aforesaid provision with effect from 1-4-1989. It is significant to notice that the omission of a provision results into an abrogation or obliteration of the omitted provision. The effect of omission in the present context is that the prosecution with respect to an offence of the year 1982-83 cannot be continued. This view has been taken by the Apex Court in the case of General Finance Co. (supra).

In view of the aforesaid, we allow this special appeal and set aside the judgment of the learned Single Judge. The writ petition is allowed and the complaint Nos. 160/86 and 161/86 pending in the court of Chief Judicial Magistrate (Economic Offences) Rajasthan, Jaipur, is quashed.

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