All the offences committed prior to issuance of show cause notice/intimation for launching of prosecution falls within the purview of “first offence”: Supreme Court
Recently SC has held that all the offences committed prior to issuance of show cause notice/intimation for launching of prosecution falls within the purview of “first offence”.
The case revolves around compounding of offence u/s. 276CC of the Income Tax Act being failure to file a return of income within the due date prescribed u/s. 139(1).
Assessee had failed to file returns of income within due date prescribed u/s. 139(1) for A.Y. 2011-12 & 2013-14. Show cause notices for A.Y. 2011-12 & 2013-14 were launched for prosecution on 27.10.2014 & 12.03.2015 respectively. Assessee filed for compounding application for A.Y. 2011-12 which came to be accepted. However, the compounding application for A.Y. 2013-14 came to be rejected by Revenue holding that only “first offence” u/s. 276CC can be compounded. The Hon’ble Gujarat HC also upheld the rejection of the compounding application.
In the SLP filed before Hon’ble SC, the primary contention of the petitioner was the incorrect interpretation of the phrase “first offence” made by the Hon’ble HC and lower authorities. It was contended that all the offences committed prior to issuance of show cause notice/intimation for launching of prosecution falls within the purview of “first offence” even though the same offence is committed for multiple years. It was contended that the date of commission of offence u/s. 276CC is the date immediately following the due date of filing return of income irrespective of whether a belated return is filed or not.
The Hon’ble SC was pleased to concur with above legal submissions. As the due dates for filing return of income for A.Y. 2011-12 and A.Y. 2013-14 fell before the earliest show cause notice issued for launching of prosecution i.e. SCN dated 27.10.2014, it was held that the assessee has committed offence for both the years before issuance of show cause notice and hence, the offence for A.Y. 2013-14 is also constituted as a “first offence” eligible for compounding.
The copy of the order is as under:
