IN THE HIGH COURT OF JUDICATURE AT MADRAS

DATED : 11.11.2020

CORAM

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

W.P. No. 35826 of 2016

V.K. Lohia

Managing Trustee: Visharada Charitable Trust

No. 1732, 21st Main Road,

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 V.K.Lohia/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 Murali Krishnan

Senior 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.

2.

The Writ Petition has been filed challenging the Order in

F. No. Compounding/V.K. Lohia/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

therein, which is extracted below:-

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

“3.

The applicant is the Managing Trustee of M/s.

Visharada Charitable Trust, Chennai which purchased a

property for an aggregate sale consideration of Rs.40

lakhs situated in 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Tax Act, 1961, (now repealed), both the vendor and the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 of Rs.20 lakhs each by contravening 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. M/s. Soffia Software Ltd., Shri K.

Venkataramani, M/s. Visharada Charitable Trust and Shri

V.K. Lohia were arrayed as Accused No.1 to 4,

respectively. 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.

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.

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

c)

M/s

Visharada

Charitable Trust

Fine of Rs.2,50,000 for

offence u/s 269UC and