The Supreme Court has set aside the Madras High Court order, which refused to stay criminal proceedings against DMK MP Kathir Anand initiated by the Income Tax Department for delayed filing of Income Tax returns and alleged tax evasion.
The Division Bench of Justice Hrishikesh Roy and Justice Pankaj Mithal stayed the proceedings, which were initiated by the Income Tax Department against Anand under Sections 276CC (failure to file return of income) and 276C(2) (wilful attempt to evade payment of tax) of the Income Tax Act, 1961 for Assessment Year 2013-14.
Appearing for the petitioner, Senior Advocates S Ganesh and Senior Advocate P Wilson contended that Anand, on his own volition, had filed his returns for the Assessment Year 2013-14 with some delay.
However, the returns were filed well before the impugned assessment order dated March 24, 2016 issued by the IT Department, it they added.
The petitioner further submitted that the 2016 assessment order corresponded to the same self assessed tax and the interest which he had already remitted on late filing of his returns.
The petition said that despite his remittance, the IT department granted sanction for his prosecution with the observation that there was a statutory presumption against him under Section 278E of the IT Act.
The Advocates further apprised the Apex Court that the petitioner had no mens rea/intention to evade tax as the return and the payable tax with interest was paid well before the assessment order and the return furnished by the assessee was also accepted by the assessing officer.
Anand had moved the Apex Court against the July 11 verdict of the Madras High Court, which had refused to quash the criminal complaint lodged by the Income Tax department against him before the First Class Judicial Magistrate, Vellore in 2016 for having allegedly not filed his returns for the Assessment Year 2013-14.