The Delhi Metropolitan Magistrate (Negotiable Instruments) Court of Magistrate Divya Arora has recently held that the violation of Section 269SS of the Income Tax Act, 1961 does not disturb the proceedings under the Section 138 of Negotiable Instruments (NI) Act, 1881.
In the case of Section 138 proceedings initiated against the accused, it was observed by the court that, the failure of the accused to put forth any reasonable and believable defence and fact that the accused has not proved his defence to cause the probabilities to lie in his favour, an element of Section 138 NI Act stands assembled.
The counsel for the accused had contended that the complainant did not disclose the factum of advancement of loan in question in his ITR, yet such factor alone cannot be enslaving enough to shroud the prosecution story with doubt.
The averment of the counsel for accused regarding non mentioning of loan amount in ITR to doubt the case of complainant do not inspire confidence as culpability of offence under Section 138, NI Act will not freeze for the reason that there is violation of Section 269 of Income Tax Act, 1961 and the same does not prevent the operation of the statutory presumption of section 139 of NI Act, said the Magistrate Court in consideration of the contention.
It was made clear that “the prosecution under Section 138 of NI Act cannot be dismissed or stalled for non-compliance of Section 269SS of the Income Tax Act” and that “such violation may give rise to an independent criminal offence, but on account of violation of the said provision, the prosecution of the accused for the alleged dishonour of cheque under Section 138 NI Act does not become bad in law.”
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