IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED : 11.11.2020

CORAM

THE HON'BLE MR. JUSTICE P.D. AUDIKESAVALU

W.P. No. 35825 of 2016

Visharada Charitable Trust,

Represented by its Managing Trustee,

V.K. Lohia,

No. 151, AH Block, Anna Nagar,

Chennai – 600 040.

...Petitioner

-vs-

Chief Commissioner of Income Tax,

Aayakar Bhavan, Main Building,

121, Mahathma Gandhi Salai,

Chennai – 600 034.

...Respondent

Prayer:- Writ Petition filed under Article 226 of the

Constitution of India praying to issue a Writ of Certiorarified

Mandamus, calling for the records of the Respondent in F. No.

Compounding Visharada Charitable Trust/2015-16 dated 29.06.2015

and quash the said order and consequently direct the Respondent

to compound the said offence under Section 279 AB read with

Sections 278 B, 269 UC and 269 UL (2) of the Income Tax Act.

For Petitioner

:

Mr. R.Sivaraman

For Respondent

:

Mrs. Hema Muralikrishnan,

Standing Counsel

O R D E R

(through video conference)

Heard Mr. R.Sivaraman, Learned Counsel for the Petitioner

and Mrs. Hema Muralikrishnan, Learned Standing Counsel appearing

for the Respondent and perused the materials placed on record,

apart from the pleadings of the parties.

https://hcservices.ecourts.gov.in/hcservices/

2.

The Writ Petition has been filed challenging the Order in

F. No. Compounding/Visharada Charitable Trust/2015-16 dated

29.06.2015 passed by the Respondent under Section 279(2) of the

Income Tax Act. 1961 (hereinafter referred to as the 'Act' for

short) rejecting the request for compounding that had been made

by the Petitioner in the application dated 11.07.2013 made in

that regard. The facts leading to the passing of the impugned

order have been captured, which is extracted below:-

“3.

The applicant trust represented by its Managing

Trustee, Shri V.K.Lohia, was the purchaser of the

property for an aggregate sale consideration of Rs.40

laksh situated at Door No AH151, 3rd Street, Anna

Nagar, Chennai-40, from one M/s. Soffia Software Ltd.

(now renames as Quintegra Solutions P. Ltd.)

represented by its Managing Director, Shri R. Venkata

Subramani who was in turn represented by a power agent,

viz. Shri S.C. Agarwal. As the full value of

consideration exceeded Rs.25 lakhs, in terms of

provisions contained in Chapter XXC of the Income Tax

Act, 1961, both the vendor and the vendee were under

the statutory obligation to furnish Form No.37-I

seeking 'no objection' from the Appropriate Authority.

Based on the information available in the office of the

DIT (Exemptions), Chennai, it was detected that single

property was sold by two split-up sale deeds dated

25.1.2001 and 27.3.2001 in contravention of the

provisions of Chapter XXC of the Act. Therefore, the

Member, Appropriate Authority, Chennai, filed a

criminal complaint against all the aforesaid four

persons for the offences under sec. of sec.269UC/269UL

(2) of the I.T.Act, before the Addl. CMM, EO-I,

Chennai, hereinafter referred to as the trial court in

EOCC No.594 of 2002. The trial court by an order dated

29-04-2010 convicted and sentenced all the four accused

with the sentences of imprisonment and fine as

tabulated herein below:

Sl.N

o.

Name of the accused

Sentence of fine and

imprisonment awarded by

the trial court

a)

M/s Soffia Software

Ltd

Fine of Rs.2,50,000 for

offence u/s 269UC and

Rs.2,50,000 for offence

u/s 269UL(2) r.w.s.276AB

of the IT Act 1961.

https://hcservices.ecourts.gov.in/hcservices/

b)

Shri.R.Venkata

Subramani

Fine of Rs.10,000 for

offence u/s 269UC and

Rs.10,000 for offence u/s

269UL(2) r.w.s. 276AB of

the IT Act 1961, with one

year RI.

c)

M/s

Visharada

Charitable Trust

Fine of Rs.2,50,000 for

offence u/s 269UC and

Rs.2,50,000 for offence

u/s 269 UL(2) r.w.s.276AB

of the IT Act 1961.

d)

Shri.V.K.Lohia,

Managing Trustee

Fine of Rs.10,000 for

offence u/s 269U