Income tax case: Jaya moves HC

Tamil Nadu Chief Minister Jayalalithaa today moved the Madras High Court to quash a lower court's order directing her and her aide Sasikala to appear before it on October 1 for questioning and for framing charges in the Income Tax returns case.

On September 18, Additional CMM R Dakshinamurthy had directed them to appear before it 'without fail' on October 1.

Defence counsel had filed petitions seeking adjournment of the case for two weeks and for dispensing with the personal appearance of the accused. They had made submissions seeking certain amendments in the order, citing the compound plea pending with the tax authorities.

Aggrieved by a portion of the order, Jayalalithaa submitted that the trial court had failed to consider that Section 279 (2) of the IT Act permits the petitioner compound the offence at any stage, either before or after institution of proceedings.

She alleged the court had failed to consider the June 25 2014 letter of the Director General of Income Tax to her, conceding her plea for adjournment of proceedings till disposal of compounding application.

The CM also said the trial court had not considered that the Supreme Court had fixed the outer time limit only for completion of trial.

As she was willing to settle the issue amicably by invoking the benevolent provision of IT Act by filing compounding application, the outer time limit fixed by the Supreme Court has no significance due to change of circumstances, she said, adding the court ought to have considered the present stage of the case.

She submitted the lower court had not taken into account revised guidelines of the IT Act for compounding offences under provisions of Direct Tax Laws from June 1 2008 of the union government with proper perspective. It had not considered the procedure to compound offences stipulated in guidelines.

It had not considered the apex court judgement where it was held that Income tax Authorities or officers concerned are bound by circulars or guidelines issued by the Board.

Jayalalithaa submitted the trial court ought to have adjourned the case considering that the result of the compounding application would have a direct bearing on criminal proceedings before it.

The lower court also ought to have considered that the compounding application filed by her on June 24, 2014 has a 180-day outer time limit for deciding as per the guidelines. Also, counsel for the IT department should have acted as per revised guidelines to get adjournment till disposal of the compounding application.

The order was violative of Art. 21 of Constitution and ordering her to appear for questioning was a violation of human rights, fundamental rights when the application for compounding the offence is pending with the department.

Hence she prayed that the portion of the September 18 order directing her to appear in court be quashed. She also prayed for an interim stay of all further proceedings.

On September 4, when the matter was last heard, the court had posted the matter to September 18, stating it had sought more time from the Supreme Court to complete the trial.

The Income Tax department had launched criminal proceedings against Jayalalithaa and Sasikala for allegedly not filing returns in their individual capacity for the assessment year 1993-94.

Complaints were also filed by the IT department against Sasi Enterprises represented by its partners, Jayalalithaa and Sasikala, for allegedly failing to file returns for the assessment years 1991-92 and 1992-93.

Discharge petitions filed by the accused were later dismissed by the Madras High Court. Jayalalithaa and Sasikala preferred appeals before the Supreme Court.

Dismissing their appeals on January 30, the apex court had directed the lower court to complete the trial in four months.