INCOME TAX OFFICER, JIND versus MIS. MANGAT RAM NORATA RAM NARWANA & ANR.

Citation: [2011] 5 S.C.R. 1137 · Decided: 05-05-2011 · Supreme Court of India · Bench: H.S. BEDI, C.K. PRASAD · Disposal: Appeal(s) allowed

Judgment (excerpt)

[2011] 5 S.C.R. 1137 
INCOME TAX OFFICER, JIND 
v. 
MIS. MANGAT RAM NORATA RAM NARWANA & ANR. 
(Criminal Appeal No. 8 of 2005) 
MAY 5, 2011 
[HARJIT SINGH BEDI AND CHANDRAMAULI KR. 
PRASAD, JJ.] 
A 
8 
Income Tax Act, 1961: ss. 276C(i), 277, 278 -
Discrepancies relating to entries of incom~, sale and C 
purchase and bank accounts of respondent-firm - Revised 
return filed duly signed by the accused-partner - Assessment 
of income - Based on assessment, penalty imposed -
Penalty paid - Complaint also lodged ulss.276C(i), 277, 278 
for prosecution of firm and partner - Magistrate held them 
D 
guilty and imposed fine on the firm and the partner and 
awarded sentence of one year rigorous imprisonment on the 
partner - Acquittal of partner by appellate court - Upheld by 
High Court on the ground that prosecution was not able to 
prove that the return was signed/verified by the accused-
E 
partf1er- On appeal, held: At no point of time, the said partner 
made any objection that the return did not bear his signature 
or was not filed by him - By not raising any dispute at any 
point of time and paying the penalty, the prosecution proved 
his admission of filing and signing the return - Nothing was 
F 
brought in evidence of the partner that signature on the return 
did not belong to him and the penalty was paid mistakenly -
The appe/late court misdirected itself in not considering the 
evidence in right perspective and acquitting the accused -
High Courl also failed to correct the apparent error - Order G 
of conviction passed by Magistrate restored - Evidence -
Admission. 
Evidence: Admission - £videntiary value of - Held: 
Admission is best evidence against the maker and it can be 
11~7 
H 
1138 
SUPREME COURT REPORTS 
[2011] 5 S.C.R. 
A inferred from the conduct of the party - Admission implied by 
conduct is strong evidence against the maker but he is at 
liberty to prove that such admission was mistaken or untrue. 
CRIMINAL APPELLATE JURISDICTION : Criminal Appeal 
8 
No. 8 of 2005. 
From the Judgment & Order dated 24.7.2003 of the High 
Court of Punjab & Haryana at Chandighar in Criminal Misc. No. 
117-MA of 2003-Appealed Form. 
c 
Mukul Gupta, Vikas Malhotra, B.V. Balaram Das, Mohd. 
D 
Mannan for the Appellant. 
S.S. Khanduja, Yash Pal Dhingra for the Respondents. 
The following Order of the Court was delivered 
ORDER 
The Income Tax Officer, aggrieved by the acquittal of the 
respondents has preferred this appeal with leave of the Court. 
E 
· According to the prosecution, respondent no.1 M/s. 
Mangat Ram Norata Ram is a partnership firm carrying on the 
business of sale and purchase of machinery, iron pipes and 
spare parts. Respondent No. 2 accused Hem Raj happened 
to be one of its partner. M/s. Mangat Ram Norata Ram 
F (hereinafter referred to as "the Firm") filed its income tax return 
for the assessment year 1988-89 on 14th July, 1988 through 
its counsel, which was signed and verified by Hem Raj, its 
partner. The income-tax return showed the income of the firm 
Rs.1,02,800/-. Return was accompanied by statement of 
G income, trading accounts, profit & loss account, partnership 
account and balance sheet for the assessment year 1988-89. 
The assessment was completed by the then Income Tax Officer 
under Section 143(3) of the Income Tax Act for Rs.1,47,370/-. 
H 
Further case of the prosecution is that the books of the 
INCOME TAX OFFICER, JIND v. MANGAT RAM 
1139 
NORATA RAM NARWANA & ANR. 
accounts of the firm were taken. into possession by the Sales 
A 
Tax Department, which were obtained by the Income Tax 
Department and on its perusal discrepancies relating to entries 
of income, sale and purchase, bank account etc. were noticed 
and accordingly a notice under Section 148 of the Income Tax 
Act (hereinafter referred to as 'the Act') was issued requiring 
B 
the respondents to furnish a revised return within 30 days. The 
respondents did not comply with the notice and thereafter 
notice under Section 142(1) of the Act was issued and the 
assessee firm ultimately filed its income tax return declaring its 
income of Rs.1,47,870/-. The prosecution has alleged that this 
C 
return was duly signed and furnished by accused Hem Raj, 
which was accompanied by revised statement of income, 
trading account and profit and loss account. All these 
documents, according to the prosecution were also signed by 
accused Hem Raj. On consideration of the same, the Assistant 
D 
Commissioner of Income Tax made addition of R

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