Mens Rea necessary to Establish Offence of Delayed Filing of ITR: Rajasthan HC [Read Order]

In a recent decision the Rajasthan High Court observed that mens rea is an essential ingredient to establish the offence of delayed filing of income tax returns (ITR).

The Income Tax Officer after getting sanction from the Commissioner of Income Tax submitted a criminal complaint against the respondent under Section 276 CC of the Income Tax Act and it was alleged that the respondent did not submit his Income Tax Returns under Section 139(1) of the Income Tax Act, within the stipulated time on or before 31.07.1978 and the assessee filed his returns on 31.12.1980.

Thereafter, proceedings under Section 271(1) of the Income Tax Act, were initiated, but the respondent failed to submit any explanation. Then a reminder was issued but no reply was submitted. Thereafter the Income Tax Officer imposed penalty of Rs.2200/- on the respondent under Section 271(1) of the Income Tax Act.

The counsel for the appellant submitted that the allegation against the respondent was that a delayed income tax return, pertaining to the assessment year 1978-79 was submitted by him after a lapse of more than 28 months and this fact has also been established on the record, by way of leading evidence furnished by the Income Tax Department and that under these circumstances there was no reason or occasion available with the Trial Court to acquit the respondent from the above charges.

The respondent contended that there was some delay in filing the income tax return but the delay was neither willful nor any intention was there which attracts the principle of ‘mensrea’ and that after appreciating the evidence available on the record, a cogent & reasoned judgment has been passed in favour of the respondent by giving him benefit of doubt.

In Prem Das Vs. Income Tax Officer, it has been held by the Apex Court that for holding an accused guilty under Section 276CC of the Act of 1961, ‘mens rea’ is a necessary ingredient. Hence, in absence of proof of ‘mens rea’ and on the basis of mere presumption under Section 132(4-A), the conviction cannot be sustained.

A Single Bench of Justice Arun Kumar Dhand observed that “The accused respondent has explained the reasons, in detail, about the delay in filing the income tax returns and depositing the entire tax amount with penalty subsequently. Therefore, the complainant/ appellant has failed to prove that the respondent had mens rea to evade the payment of tax. Accordingly, the Income Tax Department has failed to prove the guilt of the accused respondent beyond all the reasonable doubts.”

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