ASHWINKUMAR VADILAL PATEL DALAL Vs. P T MEHTA INCOME TAX OFFICER
HIGH COURT OF GUJARAT
ASHWINKUMAR VADILAL PATEL (DALAL)
P.T.MEHTA,INCOME TAX OFFICER
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(1.)The petitioner whose premises were raided and from whoses premises valuables were found by the raiding party and who could not render satisfactory explanation regarding some of the items so seized has been prosecuted for an offence punishable under Sec. 274(c) of the Income Tax Act as well as Sec. 195 of the Indian Penal Code. He has prayed that the said proceedings be quashed inasmuch as he has approached the Settlement Commission and the Settlement Commission has not only registered his petition but has recorded a finding that no concealment has been established and none is likely to be established.
(2.)Mr. Desai learned Counsel appearing for the petitioner urged that once the Settlement Commission has recorded its finding to allow criminal proceedings to continue would be a travesty of justice and Mr. Desai drew my attention to a case decided by the Delhi High Court and WhiCh has been reported in (1987) 168 ITR 222 (Dr. Mrs. Geeta Gupta v. Inspecting Asstt. Commissioner). Therein the Delhi High Court has held that once a petition has been registered by the Settlement Commission no criminal proceedings can be allowed to continue against the assessee. As against this Mr. Bhatt learned Counsel for the Revenue urged that merely because the Settlement Commission has entertained the petition it would not necessarily mean that the assessee has been exonerated completely or has been granted immunity and as such the criminal proceedings cannot be quashed.
(3.)My attention was drawn to a decision rendered by the learned single Judge of this Court (Coram: R. A. Mehta J.) in Criminal Revision Application Nos. 258 and 259 of 198G (Ashvinkumar Vadilal Patel v. S. Rajguru & Anr. 1987 (1) GLR 102) where the learned single Judge expressed the view that merely because the Settlement Commission has entertained the petition or a petition is pending before the Settlement Commission the criminal proceedings need not be quashed and need not be stayed. Mr. Bhatt heavily relied upon this judgment but there is one point of distinction between the judgment rendered by the Delhi High Court and the judgment rendered by the learned single Judge of this Court (supra) and it is this that in the instant case the Settlement Commission has recorded a finding that no come has been concealed and none is likely to be established to have been concealed. If the proceedings were to be allowed to continue and decision is allowed to be rendered in the proceedings and if ultimately the Commission were to grant immunity then an anamolous situation would arise. What the learned single Judge was concerned with was only upto a stage when the petition was filed before the Commission and was pending but in the instant case the Commission has gone a step further and recorded a finding that no concealment has been established and none is likely to be established. If such a finding is not reached by the Settlement Commission then only the filing and registering of the petition of the assessee by the Settlement Commission would not be sufficient to quash or even to stay the criminal proceedings It may be that the Commission may not in the ultimate analysis grant immunity and in that case the criminal proceedings will have to be carried to their logical conclusion. But before the Settlement Commission finally arrives at its decision to allow the proceedings before the Criminal Court to continue might lead to an anamolous situation as observed above. Under the circumstances while the complaint need not be quashed at this stage it does require to be stayed and the petitions are therefore allowed to the extent that Criminal Complaints Nos. 562 and 580 of 1985 pending before the learned Metropolitan Magistrate 2 Court Ahmedabad are stayed till the Settlement Commission renders its final decision on the question of immunity Petitions are partly allowed accordingly. Rule in each of these petitions is made absolute to the above extent. Prosecution stayed.
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