1. False evidence given on oath during income-tax assessment proceedings — Criminal complaint under Section 193, IPC — Bar to cognizance under Section 195(1)(b), CrPC. (Para 1 , 2 , 19 )
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1964 Supreme(SC) 37
SUPREME COURT OF INDIA
7th February, 1964
P.B. GAJENDRAGADKAR, C.J.I., A.K. SARKAR, K.N. WANCHOO, K.C. DAS GUPTA AND N. RAJAGOPALA AYYANGAR, JJ.
Lalji Haridas, Appellant
Versus
The State of Maharashtra and another, Respondents.
Criminal Appeal No. 141 of 1962.
Advocates appeared
Mr. S.V. Gupte, Additional Solicitor General of India, (M/s. J.B. Dadachanji, O. C. Mathur and Ravinder Narain, Advocates of M/s. J.B. Dadachanji and Co., with him), for Appellant; Mr. S. K. Kapur, Senior Advocate, (Mr. R. H. Dhebar, Advocate, with him), for Respondent No. 1; Mr. S. T. Desai, Sr. Advocate, (M/s. J. L. Nain and V. J. Merchant, Advocates of M/s. Gagrat and Co. with him), for Respondent No. 2.
Advocates:
GAGRAT JANEDRA LAL, J.B.DADACHAN, J.L.Nain, O.C.MATHUR, R.H.Dhebar, RAVINDER NATH, S.K.KAPOOR, S.T.DESAI
GAGRAT JANEDRA LAL, J.B.DADACHAN, J.L.Nain, O.C.MATHUR, R.H.Dhebar, RAVINDER NATH, S.K.KAPOOR, S.T.DESAI
Proceedings before an Income-tax Officer deemed 'judicial' under Section 37(4) of the Income-tax Act, 1922, are treated as proceedings in a court for the purpose of Section 195(1)(b) of the Code of Criminal Procedure to ensure procedural safeguards for offences attracting higher penalties.
Headnote:(A) Indian Income-tax Act, 1922 - Section 37(4); Indian Penal Code - Sections 193 and 228; Code of Criminal Procedure - Sections 195(1)(b) and 195(2) - Proceedings before an Income-tax Officer deemed to be judicial proceedings - Whether such proceedings are proceedings in a court for the purpose of taking cognizance of offences - If a proceeding is treated as a judicial proceeding for the purpose of imposing higher penalties under the Indian Penal Code, it must be treated as a proceeding in a court under the Code of Criminal Procedure to maintain the safeguard that the complaint must be made by the court. (Paras 14, 15)
(B) Code of Criminal Procedure - Section 195(1)(b) - Safeguard against private complaints for offences committed in relation to court proceedings - To avoid legal anomalies, where a public servant is sitting in a judicial proceeding, the complaint for offences like insult or interruption must proceed from the public servant or the court itself. (Para 16)
Facts of the case:
A private party filed a criminal complaint alleging that false evidence was given on oath during assessment proceedings before an Income-tax Officer. The accused contended that the complaint was barred under the Code of Criminal Procedure as the Income-tax Officer, acting as a court, had not filed the required written complaint.
Findings of Court:
The proceedings before an Income-tax Officer, being deemed judicial proceedings under the Income-tax Act, are to be treated as proceedings in a court for the purpose of the bar on cognizance under the Code of Criminal Procedure.
Issues: Whether proceedings before an Income-tax Officer under Section 37 of the Indian Income-tax Act, 1922, are proceedings in any court within the meaning of Section 195(1)(b) of the Code of Criminal Procedure.
Ratio Decidendi: The court reasoned that since Section 37(4) of the Income-tax Act makes the proceedings "judicial" for the purpose of Section 193 of the Indian Penal Code, the accused is liable for a higher sentence. It would be contradictory to increase the severity of the offence without providing the corresponding procedural safeguard under Section 195(1)(b) of the Code of Criminal Procedure, which restricts the filing of complaints to the court itself. (Paras 14, 15, 16)
Result: Appeal dismissed.
Legal Category Hierarchy
Table of Contents
2. Whether proceedings deemed judicial under Section 37(4), Income-tax Act, constitute proceedings in a Court for the purpose of Section 195(1)(b), CrPC. (Para 2 , 10 , 29 )
3. Distinction between judicial proceedings and proceedings in a Court — Necessity of safeguards under Section 195(1)(b), CrPC for offences committed during judicial proceedings. (Para 8 , 14 , 15 , 16 )
4. Proceedings deemed judicial under Section 37(4), Income-tax Act, are treated as proceedings in a Court for the purpose of Section 195(1)(b), CrPC. (Para 15 )
5. Appeal dismissed — Complaint held non-maintainable due to non-compliance with Section 195(1)(b), CrPC. (Para 18 , 41 )
6. Does every judicial proceeding necessarily constitute a proceeding in a Court?
No. A judicial proceeding is a broader term; under Section 4(m) of the CrPC, it includes any proceeding where evidence is legally taken on oath, which may occur before quasi-judicial authorities who are not Courts. (Para 13 , 33 , 35 )
7. What is the legal effect of Section 37(4) of the Income-tax Act on proceedings before an Income-tax Officer?
It deems such proceedings to be judicial proceedings within the meaning of Sections 193 and 228, and for the purposes of Section 196 of the Indian Penal Code. (Para 4 , 5 , 29 )
8. Can a private party file a complaint for false evidence given before an Income-tax Officer?
No. Since proceedings before an Income-tax Officer are deemed judicial under Section 37(4) of the Act, they are treated as proceedings in a Court for Section 195(1)(b) CrPC, requiring a written complaint from the Court. (Para 14 , 15 , 16 )
Judgment
GAJENDRAGADKAR, C.J.I.: (On behalf of himself and Wanchoo and Ayyangar JJ.)
The short question of law which arises for our decision in the present appeal is whether the proceeding before an Income-tax Officer under S. 37 of the Indian Income-tax Act, 1922 (No. XI of 1922) (hereinafter called the Act) can be said to be a proceeding in any court within the meaning of S. 195 (1)(b) of the Code of Criminal Procedure. This question arises in this way. The appellant Lalji Haridas and respondent No. 2 Mulji Manilal Kamdar are businessmen and they carry on their business in Jamnagar and Bombay respectively. They have known each other for several years past in the course of their ordinary business activities. In the income-tax assessment proceedings of the appellant for the assessment years 1949-50 and 1950-51 respondent No. 2 gave evidence on oath before the Income-tax Officer, Ward A, Jamnagar on December, 4, 1958. In his evidence he denied that he had a son named Nihal Chand and that he had done any business in the name of M/s. Nihal Chand and Co. at Jamnagar. According to the appellant, the said statements were false to the knowledge of respondent No. 2 and were made by him to mislead the Income-tax Officer and to avoid the incidence of income-tax on himself. As a result of the said false statements, the appellant was heavily taxed.
2. On November 24, 1959, the appellant filed a criminal complaint against respondent No. 2 under Section 193 of the Indian Penal Code (No. 452/S of 1959) in the Court of the Presidency Magistrate, 19th Court, Esplanade, Bombay. At the hearing of the said complaint, respondent No. 2 raised a preliminary objection that the learned Magistrate could not take cognizance of the said complaint, because the proceedings in which he was alleged to have made a false statement on oath were proceedings before a Court within the meaning of S. 195(1)(b) Cr. P. C., and since no complaint in writing had been made by the Court of the Income-tax Officer before which the said proceedings were conducted, the provisions of S. 195(1)(b) crated a bar against the competence of the appellant s complaint. The learned Presidency Magistrate held that the Income-tax Officer was not a Court within the meaning of S. 195 (1) (b), Cr. P. C., and so, he rejected the preliminary objection raised by respondent No. 2.
3. Against the said decision of the Presidency Magistrate, respondent No. 2 preferred a Criminal Revision Application (No. 1142 of 1960) before the Bombay High Court. The State of Maharashtra was impleaded as respondent No. 1 to the said Revisions Application. A Division Bench of the said High Court reversed the conclusion of the Presidency Magistrate and held that the Income-tax Officer was a Court within the meaning of S. 195(1)(b), Cr. P. C., and so, it upheld the preliminary objection raised by respondent No. 2. In the result, the complaint filed by the appellant was ordered to the dismissed. The appellant then applied for and obtained a certificate from the Bombay High Court under Article 134(1)(c) of the Constitution and it is with the said certificate that he has brought the present appeal before us. That is how the narrow question which arises for our decision in the present appeal is whether the proceedings before an Income-tax Officer are proceedings in any Court under S. 195(1)(b), Cr. P. C. The question thus raised is undoubtedly a short one, but its decision is not easy, because the arguments urged in support of the two respective constructions are fairly balanced and the task of preferring one construction to the other presents some difficulty.
4. The proceedings before the Income-tax Officer during which, according to the appellant respondent No. 2 made a false statement on oath, were held by the Income-tax Officer under S. 37 of the Act. Section 37(1) deals with the powers of Income-tax authorities and provides, inter alia, that the Income-tax Officer shall, for the purposes of the Act, have the same power
