POONAM SRIVASTAVA, J.

( 1 ) HEARD learned counsel for the applicants M/s S. P. and Company and another, learned A. G. A. for the State and Sri Ashok Kumar, Advocate, appearing for the Union of India.

( 2 ) THIS application has been filed invoking inherent jurisdiction under Section 482 Cr. P. C. to quash the proceeding in criminal case no, 164/90 under Section 276 E of Income Tax Act and also the order dated 3. 12. 1999 (Annexure No. 3) passed by the 1st Additional Sessions Judge, kanpur Nagar in criminal revision No. 447 of 1998 confirming the order passed by the Special chief Judicial Magistrate, Kanpur Nagar dated 27. 8. 1998 in criminal case No. 164 of 1990, union of India v. S. P. and Company and two Ors. under Section 276 Income Tax Act 1961.

( 3 ) THE criminal complaint was instituted by the opposite party No. 3 under Section 276 E of income Tax Act 1961 on 29 3. 1990. which is numbered as criminal case No. 164 of 1990. A copy of the complaint has been annexed as annexure No. 1 to the application. The allegations as narrated in the complaint are that the applicants contravened the provisions of Section 269 T of income Tax Act, 1961 for the assessment year 1988-89 whereby the deposit of more than Rs. 10,000/- in cash was made to the Firm M/s Kailash Nath Amar Nath and and Company in lieu of stock-in-trade. The allegation in the complaint was that in view of Section 269 T (1), the payment cannot be made in cash in accordance with the provisions of Income Tax Act. Section 269t (1) is enumerated below:

"section 269 T (1) No Company (including a banking company), co-operative Society or firm shall repay to any person any deposit otherwise than by an account payee cheque or account payee bank draft where the amount of the deposit, or where the amount of the deposit is to be repaid together with any interest, the aggregate of the amount of the deposit and such interest, is ten thousand rupees or more. "

( 4 ) THE Act provides that violation of provisions of Section 269 T (1) of the Act is punishable under Section 276 E of Income Tax Act. This provision of Income Tax Act stands deleted by virtue of Direct Tax Laws (Amendment) Act 1987 w. e. f. 1st April, 1989, Prior to its deletion, section 276 E of the Act read as under:

"section 276 E- If a person repays any deposit referred to in Section 269 T otherwise than in accordance with the provisions of that Section, he shall be punishable with imprisonment for a term which may extend to two years and shall also be liable to fine equal to the amount of such deposit. "

( 5 ) AFTER lodging of the complaint, Special Chief Judicial Magistrate Kanpur Nagar, opposite party No. 2 summoned the applicants for trial under Section 276 E of the Act and the cognizance was taken on the same day. The applicants moved an application on 30. 7. 1998 to recall the order taking cognizance on the ground that the Firm has been closed and secondly that since Section 276 E of Income Tax Act stood deleted w. e. f. 1st April, 1989, the penal provision was no more in force on the date when the complaint was instituted. The complainant filed objection stating therein that in view of Section 6 (e) of General Clauses Act, the complaint is legally maintainable and the cognizance taken by the Magistrate cannot be interfered. This application was rejected vide order dated 27. 8. 1998 for the reasons that though the complaint was filed on 29,3,1990 after repeal of Section 276 E of the Act but the offence alleged was committed for the assessment year 1988-89 and during that relevant period, the provision of Section 276 E of the act was very much applicable. This order of the Special Chief Judicial Magistrate Kanpur Nagar was challenged by filing a revision, which was numbered as criminal revision No. 447 of 1998. The revision was dismissed vide judgment and order dated 3. 12. 1999. Both the orders have been challenged in the present proceedings. Counter affidavit has been filed on behalf of the Union of india. I have hear

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