A Two-Judge Bench of the Supreme Court stayed criminal proceedings against Dravida Munnetra Kazhagam (DMK) Member of Parliament (MP) which was initiated by the Income Tax Department.
Durai Murugan (DM) Kathir Anand is an Indian politician and Member of Parliament from the Vellore constituency and the prosecution was initiated for the alleged late filing of income tax return for the assessment year 2013-14.
S. Ganesh and P. Wilson, senior counsels made submissions on behalf of the petitioner (assessee). The counsels argued that the petitioner on his own volition had filed his return for the assessment year 2013-14, albeit delayed return, well before the assessment order dated 24th March, 2016 along with the payable tax. In fact, the assessment order dated 24th March, 2016 corresponds precisely to the self-assessed tax and also the interest which the assessee had already remitted on late filing of the return.
The Counsels further brought to the notice of the Supreme Court that even then the income tax department has accorded sanction for prosecution of the assessee with the observation that there is a statutory presumption against him under Section 278E of the Income Tax Act.
It was further submitted that there is no mens rea/ intention to evade tax as the return and the payable tax with interest, was paid well before the assessment order and the return furnished by the assessee, was also accepted by the assessing officer.
Section 278E(1) of the Income Tax Act states that: In any prosecution for any offence under this Act which requires a culpable mental state on the part of the accused, the court shall presume the existence of such mental state but it shall be a defence for the accused to prove the fact that he had no such mental state with respect to the act charged as an offence in that prosecution.
The Court of Justice Hrishikesh Roy and Justice Pankaj Mithal observed that “Issue notice, returnable in four weeks. In the meantime, further proceedings are stayed.”
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