HARI SWARUP, J. - (1.) THIS revision is directed against an order of the 1st Civil and Sessions Judge by which he dismissed the revision filed against the trial Court's order refusing to discharge the accused on his pleas that the prosecution could not legally proceed.
(2.) A complaint was filed by the ITO for an offence under S. 277 of the IT Act (hereinafter to be referred to as "the Act"). The complaint made the allegation that for the asst. year 1963 -64, the accused had filed a return in which he had concealed the particulars of his income. The summonses were issued to the accused but before the charge was framed an objection was taken to the further proceeding of the trial in view of S. 279 of the Act. It was urged that the complaint had not been filed at the instance of the CIT and that the case could not proceed against the accused in view of the penalty being waived within the meaning of S. 279(1A) of the Act. The contentions were not accepted by the Magistrate and the 1st Civil and Sessions Judge dismissed the revision. Certified copy of the judgment of the Tribunal in the appeal arising out of the penalty proceeding and of the AAC dismissing the appeal against the original assessment order as infructuous have been filed as additional evidence in this Court. The facts leading to the case as have finally emerged out are the following : A particular income was returned by the assessee. The ITO found that the return was not correct and hence completed the assessment at a higher figure. He was further of the opinion that penalty was imposable under s. 271(1)(c) of the Act but as the amount of penalty had to be greater than Rs. 1,000 he referred the matter to the IAC. The IAC imposed a penalty. Against that order an appeal was preferred before the Tribunal. The Tribunal allowed the appeal and set aside the order imposing the penalty. The ITO issued notice under S. 147 and made a supplementary assessment for the escaped income. The Tribunal set aside that assessment and remanded the case to the ITO for fresh consideration after giving opportunity of leading evidence to the assessee. With respect to the original assessment, the assessee filed an appeal before the AAC. That appeal was dismissed as infructuous. The AAC appears to have thought that the appeal had become infructuous because of the order of the Tribunal passed in appeal arising out of the supplementary assessment made by the ITO under S. 147 of the Act. The effect of the various orders is that the appeal against the original assessment has been dismissed as infructuous; the case under S. 147 of the Act has been remanded to the assessing authority by the Tribunal and the penalty imposed on the basis of original assessment has been set aside. On the basis of these facts it has to be seen whether the prosecution can continue or it has to be quashed.
(3.) ACCORDING to sub -s. (1) a person can be proceeded against for an offence under S. 277 only at the instance of the CIT. The evidence produced in the case shows that the CIT had authorised the prosecution. In view of the law laid down by the Supreme Court in the case of T.S. Baliah vs. T.S. Rangachari, ITO (1969) 72 ITR 787 (SC) : TC48R.189 "at the instance of the Commissioner" must mean "at the authorisation of the Commissioner". The prosecution cannot, therefore, be held to be without authority of law by reason of sub -s. (1) of S. 279 of the Act.;