K.R. Pradeep vs The Income Tax Department

Heard the learned counsel appearing for the petitioner.

Learned counsel appearing for the petitioner in Crl.P.Nos.22/2020, 6180/2019, 7701/2019 would submit that in these petitions wherein challenge is made to the order of taking of cognizance against the petitioner for the offence punishable under Section 35B of the Wealth Tax Act, 1957. Learned counsel appearing for the petitioner also relies upon the appeal filed before the Commissioner of Wealth Tax in respect of years 2013-14, 2014-15, 2015-16 and these appeals are pertaining to this petitioner is concerned.

The learned counsel brought to the notice of this Court the order passed by the Authority in 7.4 wherein also when the grounds are taken by this petitioner, the Appellate Authority found in respect of these years of Wealth Tax Returns. The Assessing Officer is directed to verify the claim of the debts of the appellant and allow/offset of the same after verification of the assets for the relevant years. Accordingly, the grounds of appeal for the said years are satisfactorily allowed and matter is also remitted back to the Assessing Officer to verify and consider the same. The said order was passed on 06.05.2026 and the respondent have not yet taken the decision. Hence, the counsel would contend that in view of remitting the matter back, there cannot be any continuation of proceedings in respect of these years are concerned.

Per contra, the counsel appearing for the respondent would submit that the matter is remitted back to the concerned with a direction to verify the claim of the debts of the appellant and allow/offset the same after verification and yet to take the decision and hence, these petitions have to be continued.

The counsel would submit that after the issuance of notice, the petitioners have voluntarily filed the assessment. The counsel appearing for the respondent would submit that after conducting the raid in 2017, search was conducted on 13.10.2017. The accused having found the wealth exceeding the maximum amount, he had not filed the Wealth Tax Returns and subsequently, filed the Returns on 18.01.2021.

Learned counsel appearing for the petitioner would submit that the same is also filed in pursuance of the notice issued by the respondent. Anyhow, the dispute between the parties is with regard to the payment of wealth tax is concerned and when the appeal was filed and matter is remitted back to the concerned Assessing Officer directed to verify the claim and the grounds of the appeal also came to be considered and the Assessing Officer comes to the conclusion that grounds of the appeal are satisfactory and allowed the appeal and the respondent is yet to take the decision. If decision is taken with regard to the payment of tax is concerned, then the respondent can recover the same by initiating the proceedings in accordance with law.

When already claim made by the petitioners are considered by the Commissioner of Wealth Tax by the Appellate Authority, the same has to be adjudicated. Hence, the petitioner has made out grounds to quash the proceedings initiated against the petitioners subject to the result of decision taken by the respondent to recover the same, if any, deficient in accordance with law.

If the petitioner is liable to pay any wealth tax, if any and if the Authority comes to the conclusion that the petitioner is liable to pay, the same is not paid within time, the liberty is given to the respondent to proceed in accordance with law if the same is not filed within time and if it is belated.