Issuance of notice for prosecution of partner of the firm is not a precondition.

AR.Lakshmanan, J.

The Income Tax Officer, Headquarters, TDS, and the Income-tax Officer, Salaries Circle, Madras, have preferred three complaints before the Additional Chief Metropolitan Magistrate, (Economic Offences I), Madras-8, against the respondents herein under Sec.276-B and 276-B read with Sec.278-B of the Income Tax Act, 1961 (hereinafter referred to as the Act) for their failure to deduct income-tax at source from the interest amounts paid to various persons as per Sec.194-A of the Act. The 1st respondent is the firm and the 2nd respondent is the partner of the 1st respondent firm.

.2. The 1st respondent- company in E.O.C.C. Nos.292 to 360 of 1987 (Crl.R.C. No.417of 1987) furnished its return of income, which was signed by the 2nd respondent, in the form of trading profit and loss accounts and balance she’et for the accounting year 30.9.1982 (Assessment Year 1983-84) on 30.12.1985. In the statement accompanying the return, the firm claim to have paid interest to the extent of Rs,6,64,565.98 to various parties. Of these, there were payments over Rs.1,000 in aggregate during the financial year in respect of 68 parties. The respondents have failed to deduct tax of Rs.2,400 on the interest credited to Sri Finance Corporation on various dates. Since the 1st respondent had failed to deduct the tax at source as per the provisions of Sec.194-A of the Act, show cause notice under Sec.276-B of the Act was issued on 310. 1986 calling for the assessee’s explanation for non-deduction of tax at source under Sec.l94-A of the Act. There was no response from the firm. For the failure on the part of the 1st respondent- firm to deduct tax at source from the amount of interest paid to the creditors and thereafter to remit the same within seven days from the last day of the month in which deduction was made or within two months of the expiration of the month in which the date of crediting to the parties amount falls, to the credit of the Government of India’s account as stipulated in Rule 30(1)(b) of the Income Tax Rules, 1962, which is without reasonable cause or excuse, the Department seeks to prosecute the 1st respondent- firm under Sec.276-B of the Act. The 2nd respondent being the Managing Partner of the 1st respondent-firm at the material time, is responsible for the conduct of the business of the firm, and has committed the offence under Sec.276-B read with Sec.276-B of the Act. Therefore, the above complaint was filed requesting the trial Magistrate to take the complaint on file, issue process to the accused/ respondents and deal with them in accordance with law.

3. The 1st accused/1st respondent in C.C.Nos.361 and 362 of 1987 on the file of the Additional Chief Metropolitan Magistrate (Economic Offences I), Madras-8 (Crl.R.C.No.415 of 1987) is a partnership firm carrying on the business of marketing quality eye wares and the 2nd accused, who is its partner, has signed the firm’s annual return in Form 24, under Sec.206 of the Act. For the assessment year 1986-87, relevant for the financial year ended 33. 1986, the firm filed an annual return in Form No.24 under Sec.206 of the Act on 24. 1986. It also furnished the particulars in Form No.24. According to the particulars furnished, even though the employees had a taxable income-tax was not deducted at source in accordance with the provisions of Sec.192 of the Act. Therefore, a letter was issued on 12. 1987 by the complaint to the assessee firm requiring them to furnish monthly remittance particulars. The assessee in its reply dated 20.2.1987 has stated that since the annual income under this head does not exceed the minimum amount liable to tax, the monthly remittance particulars in Form No.24 are shown as ‘Nil’. It is stated that the failure on the part of the firm to deduct tax at source under Sec.192 of the Act and to remit the same within the time stipulated is an offence punishable under Sec.276-B of the Act. The 2nd accused/ respondent being the partner, of the 1