Calcutta HC upholds Prosecution Under Black Money Act during Pendency of Income Tax Proceedings [Read Judgment]

The Calcutta High Court has held that Prosecution under Black Money Act (Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015) during the pendency of Penalty proceedings under the Income Tax Act does not amount to Double Jeopardy.

The petitioner Mr. Shrivardhan Mohta has sought a declaration that, the provisions of Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 must be applied prospectively with effect from April 1, 2016. The petitioner has also sought to quash of notices dated June 13, 2018, September 6, 2018, and the sanction for prosecution dated September 17, 2018.

The petitioner contended that penalty proceedings under Sections 271(1)(b) and 271(1)(c) of the Income Tax Act were pending against him, in furtherance of notice under Section 153A of the Act, which led to the discovery of his foreign assets.

The Black Money Act came into effect from April 1, 2016, and it cannot be given retrospective effect. He further contended that as per Section 71 of the Black Money Act, it will not apply if notice proceedings under Section 153A of Income Tax Act were pending. He further advanced that continuation of proceedings under both the Acts would amount to double jeopardy.

Justice Debangsu Basak while relying upon a precedent in State of Maharashtra v. Sayyed Hassan has said that, “there is no bar to a trial or conviction of an offense under two different enactments. The bar is only to the punishment of the offender twice for the same offense. Where an act or an omission constitutes an offense under two enactments, the offender may be prosecuted and punished under either or both enactments but shall not be liable to be punished twice for the same offense”.

While dismissing the Writ Petition, the Court also observed that the “Income Tax Act of 1961 does not impose a punishment of imprisonment while the Black Money Act of 2015 does. In such circumstances, it cannot be said that the petitioner has been sought to be punished twice for the same offense”.